The FSA regulatory regime is on the verge of an overhaul which will see the Conduct of Business (COB) rulebook radically reformed.
The City watchdog proposes to cut the number of rules in the COB industry bible by half and replace it with Newcob.
The changes will come into force in November 2007 to coincide with the implementation of the recommendations of the Markets in Financial Instruments Directive (Mifid). The FSA said it would shift significantly to become a principle-based regulator.
The new rules are likely to come in for criticism from some brokers who would prefer a more prescriptive approach from the regulator. But the FSA said the move signified a focus on the "outcomes that really matter rather than procedural box-ticking."
FSA director of retail policy Dan Waters said: "Newcob's key message will be easier to understand and so easier to comply with, thereby helping to treat their customers fairly, in line with one of the FSA's core principles."
