COBS 8 — Client agreements

Category: Compliance & AML · Reviewed by Al Jabbar, Broker · Specialist Risks · Last reviewed June 2026

The FCA rules requiring firms carrying on designated investment business with retail clients to enter into a written client agreement setting out the essential rights and obligations of the parties.

Definition

COBS 8 sets out the rules on client agreements for designated investment business. A firm must establish a written basic agreement with a retail client, setting out the essential rights and obligations of the firm and the client. The corresponding rule for MiFID business is COBS 8A.

Legal / Regulatory basis

FCA Handbook, COBS 8 and COBS 8A. Made under FSMA sections 137A, 138, with COBS 8A implementing the UK retained MiFID II Article 25(5) requirement.

How it works in practice

A retail client agreement must cover the services provided, the duration, the firm’s status and regulation, the basis of fees, the information that will be provided, complaint handling, applicable law and jurisdiction, and termination rights. The agreement must be provided in good time before the client is bound and retained for the period required by applicable record-keeping rules.

Common variations

For pure insurance distribution the operative document is the Terms of Business or “Client TOBA” required by ICOBS 4 and ICOBS 6, not COBS 8. The standards substantively overlap on disclosure but the legal hook is different.

Example

A wealth manager providing portfolio management to a retail client signs a COBS 8A client agreement before commencing service. An insurance broker, by contrast, issues a Terms of Business under ICOBS 4 before placing cover.

See also

• ICOBS 4 — Information about the firm and provider
• COBS — Conduct of Business Sourcebook
• COBS 9 — Suitability

References

FCA Handbook, COBS 8 and COBS 8A. Financial Services and Markets Act 2000, sections 137A and 138. UK retained MiFID II (Directive 2014/65/EU), Article 25(5).

Last reviewed

By Matt Bartlett, Director, on 2026-06-11.

This entry is part of the Apex Insurance Wiki. Last reviewed by Matt Bartlett on 2026-06-11. Apex Insurance Brokers Limited, FCA FRN 724952, Companies House 07014570. Not regulated advice — consult your broker on your specific position.