Regulatory change
CP26/10: what it means for your firm
The FCA's consultation paper on ongoing advice charges and annual reviews will reshape how firms manage their long-tail client segments. Here is what the consultation actually says, who it affects, and what you need to do before the 22 May 2026 deadline.
25 Mar 2026
Published
22 May 2026
Consultation closes
67 pages
Consultation paper
Late 2027
Expected implementation
What CP26/10 proposes
CP26/10 proposes that firms charging ongoing advice fees must evidence that clients are receiving the service they are paying for. The blanket annual review requirement goes away. In its place: a duty to review clients at a frequency the firm determines is appropriate, consistent with Consumer Duty.
The firm must document its rationale for each client segment. It must evidence that the chosen frequency reflects the client's circumstances, the complexity of their arrangements, and the nature of the ongoing service. If you can't evidence the review, you lose the right to charge.
This is not deregulation. It is a shift from prescriptive compliance to outcomes-based evidence. The burden of proof moves from "did you do an annual review?" to "can you justify your review approach for every client segment?"
The part most firms are missing
CP26/10 doesn't let you off the hook. It puts you on a bigger one. Proving ongoing value to every fee-paying client is harder than ticking an annual review box. Firms that treat this as permission to stop reviewing will face the sharpest regulatory scrutiny.
Who this affects
Every firm with ongoing advice clients who aren't being reviewed regularly. The firms most exposed are those with large long-tail segments: clients paying ongoing fees but sitting below the threshold where a full adviser review is commercially viable.
The Lang Cat's 2024 data showed 17% of firms were not delivering annual reviews at all. Under CP26/10, those firms face a harder problem: they now need to evidence not just the review but the rationale behind their chosen review frequency.
The three options for firms
1. Stop charging
Switch long-tail clients to a non-advised, non-charging arrangement. You lose the recurring revenue permanently. For a firm with 300 long-tail clients generating £400 each, that is £120,000 per year gone.
2. Hire internally
Recruit staff to conduct the reviews. Adds fixed cost (£35,000-£50,000 per head), takes months to hire and train, and creates a scaling problem as the client book grows. One reviewer can handle roughly 200-250 reviews per year. If your long tail is larger, you need more than one.
3. Outsource to Pillar
Variable cost per review. Live within weeks. Our relationship managers work inside your Intelliflo, follow your processes, and generate the evidence CP26/10 will require. You keep the client relationship and the recurring revenue. No setup fees. No minimum commitment.
What the FCA expects to see in your files
A file note that says "annual review conducted, no changes" will not pass scrutiny. The FCA's Section 165 requests and Consumer Duty supervisory work have made clear what they expect:
Timeline
CP26/10 published
Consultation closes. Firms can submit responses until this date.
Policy statement expected. Final rules published.
Implementation period. Firms expected to be compliant.
What firms should do now
Read the consultation paper. The substance is in chapters 3 and 4. Map your client segments by revenue and review frequency. Identify which segments are exposed. Model the cost of reviewing each segment at the frequency you think the FCA will consider appropriate.
If you plan to respond to the consultation, the deadline is 22 May. The FCA takes industry responses seriously. The final rules will reflect the weight of feedback.
Firms that start building their review infrastructure now will transition smoothly when the rules take effect. Firms that wait will pay more to move faster later.
Related reading
CP26/10 and periodic reviews: what IFA firms need to know now
A deeper look at what the shift from annual to periodic reviews means in practice.
Your annual review file wouldn't survive a Section 165 request
What the FCA's information requests actually ask for and what good evidence looks like.
Consumer Duty and annual reviews: what firms need to evidence in 2026
How Consumer Duty supervision has shifted from implementation to enforcement.
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Don't wait for the final rules
The firms that prepare now will transition smoothly. The rest will pay more to move faster later.
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