FCA Consumer Investment Disclosures: A Practical Guide to CP26/24

On 2 July 2026, the Financial Conduct Authority (FCA) published Consultation Paper CP26/24, Simplifying Consumer Investment Disclosures. It proposes to consolidate the cost and charges disclosure rules currently split across the Conduct of Business Sourcebook (COBS) into a single new chapter, COBS 6A, covering business under the Markets in Financial Instruments Directive (MiFID), the Insurance Distribution Directive (IDD) and other designated investment business. Nothing in the paper is a rule yet. The consultation is open for comment until 21 August 2026, and the FCA intends to publish a policy statement with final rules by the end of 2026.

The FCA states that the proposals apply to firms carrying out MiFID or equivalent third country business, firms engaged in insurance distribution activities, and firms carrying out other forms of designated investment business, a population it estimates at around 5,300 firms. The reason to look at the paper now, rather than waiting for the policy statement, is sequencing. The FCA has timed the proposals so that firms can make their disclosure changes once, alongside the Consumer Composite Investments (CCI) regime going live on 8 June 2027, rather than redesigning the same customer journeys twice. Firms that plan their cost disclosure work in isolation from their CCI implementation risk paying for the same systems change on two separate occasions.

What Is the FCA Proposing in CP26/24?

CP26/24 follows the CCI disclosure regime, for which final rules were published in Policy Statement PS25/20 in December 2025. Those rules replaced the Packaged Retail and Insurance-based Investment Products (PRIIPs) and Undertakings for Collective Investment in Transferable Securities (UCITS) disclosure documents with a CCI product summary, giving firms considerable freedom over presentation while standardising three metrics: risk, past performance, and costs and charges. This consultation fulfils a commitment given in PS25/20 to review the MiFID-derived requirements during 2026, and sits within the wider Consumer Duty Requirements Review, under which the FCA is examining where legacy disclosure requirements can be streamlined now that the Duty is in place.

The case the FCA makes for change rests on evidence that consumers do not understand what they pay. Its 2024 Financial Lives Survey found that 30% of non-advised platform users said they did not know how much they are charged for investing on their platform, and that 6.5 million UK adults, around 12% of the adult population, had low financial capability. Its cost benefit analysis breaks the affected population down into around 5,000 advice firms, approximately 70 platforms and around 200 execution-only brokers, and estimates one-off direct costs of around £20.1m, made up of £2.9m in familiarisation and legal costs, £6.4m in training, £4.3m in IT change and £6.5m in change project costs. Pensions business is affected, but only in limited respects, and the FCA proposes broad exemptions in that area.

There are five main strands to the package:

1. Realigning pre-sale cost disclosure with the CCI cost categories.

2. Retaining a total cost figure post-sale, with a new allowance to use a reasonable estimate.

3. Removing the MiFID-derived cumulative effect illustration.

4. Introducing new disclosures on interest and fees relating to cash holdings, and codifying the FCA's position on double-dipping.

5. Consolidating the existing disclosure rules into a single new chapter, COBS 6A, with reduced requirements for professional clients.

Each is a proposal on which the FCA has asked sixteen questions. None takes effect until the FCA makes final rules.

Pre-sale cost disclosure realigned to the CCI product summary

At present, MiFID-derived rules require firms to give the client a personalised, aggregated total of all costs and charges before a transaction, covering both the service and the product. The FCA proposes to keep the principle that service and product costs are shown together, but to change what is added into the headline figure so that it mirrors the CCI product summary.

Under the proposal, firms would present the total of ongoing product costs and service costs. One-off product costs and explicit product transaction costs would be disclosed as separate items rather than folded into that total, as would the ongoing costs of closed-ended investment funds (CEIFs) held within another CCI, which are borne indirectly. Performance fees and carried interest would be described rather than estimated, with an explanation of when they would be incurred, and firms could link through to the explanation in the product summary where the product is a CCI.

Costs would still be shown on a personalised and annualised basis, as a percentage and in pounds and pence. One practical change worth noting is the treatment of flat fees. Where a firm charges a flat fee across a whole portfolio, such as a monthly platform fee, the FCA proposes that this is shown as a percentage of the consumer's total holdings with the firm rather than of the individual transaction, which can make the fee look artificially high.

The FCA also uses this section to encourage firms away from static PDF disclosures towards disclosure built into the customer journey, citing its Occasional Paper 32 finding that a review screen reminding customers of total cost was effective at prompting them to consider it. That is an expectation and an encouragement rather than a proposed rule, and firms should read it as such.

Post-sale disclosure and a new allowance for reasonable estimates

Post-sale, the FCA proposes that consumers continue to be told the total costs incurred across all categories, in pounds and pence and as a percentage, including one-off costs, performance fees and explicit transaction costs incurred in the period. CEIF costs would be itemised separately. Firms would retain the freedom to present breakdowns and sub-totals, including a sub-total that matches the pre-sale presentation.

The change most likely to reduce operational burden is the proposal to permit a reasonable estimate of actually incurred costs where obtaining exact figures would require disproportionate effort. The FCA expects firms to be able to rely on the same data for their CCI and post-sale cost disclosure obligations, and has added guidance reminding firms of their obligations to cooperate with reasonable requests for data. Firms would still be expected to use best endeavours to present costs as accurately as possible, so this is a proportionality allowance rather than a relaxation of standards.

The cumulative effect illustration would go

The FCA proposes to remove any requirement to present personalised forward-looking illustrations of the impact of costs over time, in any disclosure, and to remove the cumulative effect illustration pre-sale. Its reasoning is that MiFID never specified a methodology, that firms have interpreted the requirement inconsistently, and that attempting to prescribe a methodology would run into the same problems that led the FCA and HM Treasury to remove PRIIPs performance scenarios in 2021.

This is not an instruction to stop explaining the relationship between costs and returns. Firms may still produce generic or dynamic cost impact illustrations, and the FCA points to an interactive tool as a potentially more valuable approach. In place of the pre-sale illustration, the FCA proposes that regular post-sale reporting should show how total costs have affected the performance of the consumer's investments over the reporting period, with firms free to choose the presentation, and that this information should be available over the lifetime of the service, for example within an online account.

The FCA acknowledges openly that its proposals would leave consumers without comparable pre-sale illustrations, and has asked whether there is a proportionate way of achieving comparability that it has overlooked. This is one area where the final rules may differ from the consultation.

Cash holdings, interest and double-dipping

Chapter 3 addresses how firms communicate about interest earned and fees paid on cash balances. The FCA's 2024 Financial Lives Survey found that 15% of consumer investment platform users said they hold more than 10% in cash on their platform, and that knowledge of the applicable interest rate varied widely.

The FCA proposes to codify as a rule the expectation set out in its December 2023 Dear CEO letter that firms should not both charge a fee on cash holdings and retain interest on them, a practice it calls double-dipping. Alongside this, it proposes that firms state prominently, with their other fees information, whether they charge fees and pass on interest in full or retain some or all of the interest, and that they explain in consumer-friendly terms how the interest rate is set, for example by reference to the Bank of England base rate.

Two further proposals affect operational processes. When a consumer pays cash into an account, firms would give a personalised indication of any fees chargeable on cash holdings and an estimate of the interest likely to be paid over the first year at the prevailing rate, with exemptions where the cash has an explicit and immediate investment purpose or is provided directly to pay fees. Regular post-sale reporting would also need to tell customers the interest they earned and the fees they paid on cash balances.

Pension providers would not be subject to these cash holding requirements, as rules on cash interest disclosure already exist in COBS 13. The FCA also notes that the Government has announced proposed changes to the tax treatment of cash held in Stocks and Shares ISAs, and is clear that tax is a matter for the Government rather than the regulator.

One consolidated chapter, and lighter requirements for professional clients

The main disclosure rules currently sit in COBS 6.1ZA for MiFID and IDD-scope business and COBS 6.1 for non-MiFID business. The FCA proposes to consolidate these into a new COBS 6A, to move the high-level disclosure requirements in COBS 2.2 and 2.2A into the same chapter, and to delete CASS 9.4 so that all disclosure requirements sit in one place. It also proposes to remove the IDD-derived remuneration disclosure rules at COBS 6.1ZA.15B to 15J, on the basis that the Consumer Duty already sets standards on fair value and staff incentives.

The FCA expects limited impact overall, noting that MiFID-derived rules already cover the great majority of retail investment services and that firms often apply MiFID standards to non-MiFID business in any event. The incremental change is concentrated on firms currently complying with COBS 6.1, which would move to the new pre-sale regime and, for the first time, be required to provide regular post-sale cost disclosures showing how costs have affected performance. Firms in that position should not assume this is a presentational exercise.

For professional clients, the FCA proposes to remove most detailed disclosure requirements while retaining a high-level obligation to provide transparent cost information, which firms could satisfy either by disclosing in accordance with the retail rules or by providing such information as the professional client agrees is adequate. Limited exceptions are proposed for portfolio management service information and compensation information, and the CASS information rules would be maintained. The cash holdings disclosures would not apply to professional clients or eligible counterparties.

When Would the New Rules Apply?

The proposed timetable is staged, and is designed to let firms align this work with their CCI implementation. The key dates the FCA has proposed or confirmed are:

• 21 August 2026: the consultation closes.

• Q4 2026: the FCA intends to publish a policy statement with final rules, and proposes to bring the revised cost disclosure rules into force close to the date of publication.

• June 2027: proposed commencement of the new cash interest disclosure requirements.

• 8 June 2027: the CCI regime goes fully live and COBS 6.1ZA.14R is retired.

• 25 October 2027: changes to COBS 6.1 for regulated cryptoasset activities, made final in PS26/13, come into force and are proposed to be copied unchanged into COBS 6A.

• June 2028: proposed end of the eighteen month transition, after which COBS 6.1ZA and COBS 6.1 would be retired and COBS 6A would apply to all designated investment business.

During the transition, firms could continue to apply the existing rules or move to COBS 6A at a time of their choosing. The FCA accepts that this means consumers may see different presentations from different firms for a period, and considers that an acceptable trade-off for orderly implementation. It has also confirmed that there will be no requirement to retrospectively repaper existing client relationships.

Separately, the FCA proposes to amend the CCI transitional provisions so that where a manufacturer produces a product summary early, distributors may continue providing the existing Key Information Document or Key Investor Information Document, and manufacturers need not update those legacy documents unless there has been a material change to investment objectives or strategy, or the risk-return profile has materially changed.

Key Themes for Firms to Take From CP26/24

Three themes run through the paper and are worth drawing out.

The first is that prescription is being traded for Consumer Duty judgement. Several of the proposals remove a detailed requirement and rely on the Duty, and in particular the consumer understanding outcome in PRIN 2A.5, to hold the standard. That is a reduction in rules, but not necessarily a reduction in work: a firm that removes a cumulative effect illustration and puts nothing in its place will find it harder to evidence that its customers understand the impact of costs on returns.

The second is that supervisory expectations are hardening into rules. The double-dipping position has been public since December 2023, but as an expectation communicated by letter. Codifying it changes what non-compliance looks like. Firms that concluded in 2024 that their approach was defensible under the Duty should revisit that conclusion against the drafting.

The third is the FCA's evident interest in how disclosure is delivered, not just what it contains. The references to dynamic disclosure, review screens, online tools and lifetime availability of cost information all point in the same direction. The FCA notes that disclosure rules need to work in a world where consumers use artificial intelligence to access and summarise information about investments.

What Should Firms Do Now

The proportionate response depends heavily on where a firm starts. A platform or advice firm already producing MiFID-standard disclosures faces a presentational reworking. A firm currently operating under COBS 6.1, or one that holds material client cash balances, faces something more substantial. The following steps are a reasonable starting point.

• Confirm which rules currently apply to your business, distinguishing MiFID-scope, IDD and non-MiFID activity, and identify where the proposals would change your obligations rather than your presentation.

• Map your current pre-sale and post-sale cost disclosures against the proposed COBS 6A approach, paying particular attention to what is currently aggregated and would need to be separated out.

• If you hold client cash, review your interest and fee arrangements against the proposed double-dipping rule and check that your published explanation of how you set the rate would satisfy the proposed standard.

• Establish whether you can obtain the cost data you would need from manufacturers and other firms in the value chain, and whether the proposed reasonable estimate allowance would be needed.

• Coordinate this work with your CCI implementation planning so that systems and customer journey changes are made once rather than twice.

• Allocate ownership at senior manager level, and record the decision and its rationale where you conclude that limited change is required.

Firms with a view on the proposals still have time to respond before 21 August 2026, and the FCA has specifically invited views on whether there is a proportionate way to preserve pre-sale comparability that it has not identified. Responses from smaller firms on the practicality of obtaining accurate cost data are likely to carry weight.

What firms should not do at this stage is rebuild disclosure documents against draft text. The rules are not final, and the FCA has flagged more than one area where its own position may move. Scoping and impact assessment now, build after the policy statement, is the sensible order.

Frequently Asked Questions

Does CP26/24 change the rules now?

No. CP26/24 is a consultation paper published on 2 July 2026, not a policy statement. The proposals in it have no legal effect. The FCA has said it intends to publish a policy statement with final rules by the end of 2026, and the proposed rules would then come into force in stages between late 2026 and June 2028.

Which firms would be affected by the proposed COBS 6A rules?

The FCA states that the consultation applies to firms carrying out MiFID or equivalent third country business, firms engaged in insurance distribution activities, and firms carrying out other forms of designated investment business. Its cost benefit analysis estimates around 5,300 firms in scope, principally financial advice firms, investment platforms and execution-only brokers. Pensions business is largely carved out, with only limited changes proposed.

Are cumulative effect illustrations being abolished?

The FCA proposes to remove the requirement to provide them, both pre-sale and post-sale, and to remove any requirement for personalised forward-looking cost illustrations. Firms would still be able to provide generic or dynamic illustrations voluntarily. In place of the requirement, firms would need to show in regular post-sale reporting how total costs have affected the performance of the customer's investments over the period.

What is double-dipping, and what is the FCA proposing?

Double-dipping is the practice of both charging a fee on a customer's cash balance and retaining the interest earned on it. The FCA set out its expectation that firms should stop this in a Dear CEO letter in December 2023. CP26/24 proposes to codify that expectation as a rule, so that firms may only charge fees on cash holdings if they pass on interest in full.

When would firms need to comply?

If the proposals are made final as drafted, the revised cost disclosure rules would come into force close to the publication of the policy statement in Q4 2026, with the existing rules remaining available during an eighteen month transition to June 2028. The new cash interest disclosure requirements are proposed to commence in June 2027. From June 2028, COBS 6A would apply to all designated investment business.

How Compliance Angle Can Help

CP26/24 is a scoping and planning exercise before it is an implementation exercise, and the right level of response varies considerably between firms. Compliance Angle supports FCA-regulated firms with the parts of that work where an independent view is useful.

• Regulatory change support, to assess how the proposals would apply to your permissions and business model and to translate them into a realistic implementation plan.

• Compliance and regulatory health checks, including targeted gap analysis of current cost and charges disclosures against the proposed COBS 6A approach.

• Consumer Duty support, particularly on the consumer understanding outcome, which carries more weight as prescriptive requirements are removed.

• Compliance frameworks and policies, to update disclosure-related procedures, controls and monitoring once final rules are published.

• Risk management and governance support, to allocate ownership, structure senior management oversight and improve the management information that supports it.

Our support is proportionate to the firm's business model, permissions, size and regulatory risk. For a firm already meeting MiFID disclosure standards, that may mean a short scoping review and a watching brief until the policy statement. For a firm currently outside those requirements, it is likely to mean something more structured.

If you would like to discuss what CP26/24 would mean for your firm, please contact us at info@complianceangle.co.uk.

Source: Financial Conduct Authority, CP26/24: Simplifying Consumer Investment Disclosures, published 2 July 2026. The consultation closes on 21 August 2026.