COB 2.6 COB 2.6 Transitional Rules
Authorised Firmmay continue to treat a Personas a Retail Client, Professional Client, or Market Counterparty, as the case may be, without having to re-classify the Personunder section 2.3:(a) where the Authorised Firmwas treating that Personas such a Client(including under a waiver or modification in force) immediately prior to 1 April 2015; and(b) with regard to the Financial Services carried on with or for that Clientprior to that date.
COB 2.6.2 COB 2.6.2
Without limiting the generality of Rule 2.6.1, and for the avoidance of doubt, any client classification adopted, Transaction carried on with or for a
Client, or Client Agreemententered into with a Clientfor the purposes of section 3.3, prior to 1 April 2015, remains in force on and after that date.
COB 2.6.2 Guidance1. The introduction of the new client classification regime does not trigger the need to re-classify existing
Clients. However, with regard to an existing Clientwho has been grandfathered under Rule 2.6.1, the need for a re-classification may subsequently arise in a number of circumstances such as those set out in paragraphs 2, 3 and 4.2. Where a Professional Clientgrandfathered under Rule 2.6.1 subsequently requests to opt-in as a Retail Clientunder Rule 2.4.1(3), the Authorised Firmwill need to re-classify that Clientin accordance with the requirements in that Rule.3. Where a grandfathered Clientwishes to obtain a new Financial Serviceafter the new regime came into force, an Authorised Firmwill not be able to rely on the existing client classification relating to that Clientin respect of the new Financial Service. This is because Rule 2.6.1 only applies in respect of the Financial Servicescarried on with or for a Clientbefore the new regime came into force. Therefore, the firm will need to make a new classification relating to such a Clientin respect of the new Financial Serviceand do so under the new client classification regime.4. If an Authorised Firmbecomes aware that a grandfathered professional client no longer fulfils the requirements to remain classified as a Professional Client, it will need to comply with the requirements in Rule 2.3.3(2).
COB 2.6.3(1) For the purposes of classifying a
Personas an 'assessed' Professional Clientunder either Rule 2.3.7 or Rule 2.3.8, the reference to $1 million in each of Rules 2.3.7(1)(a) and 2.3.8(1)(a) is to be read as a reference to $500,000 on and before 31 March 2016.(2) An Authorised Firmmay continue to treat a Personas an 'assessed' Professional Clientin reliance on the lower asset threshold specified in (1) on and after 1 April 2016 provided:(a) it is in respect of the Financial Servicescarried on with or for the Clientprior to that date; and(b) the firm continues to ensure that all the other applicable requirements in this chapter are met in respect of that Client.