What legislation gives power to UK regulators?

The correct answer is the Financial Services and Markets Act (FSMA) 2000, which is a key piece of legislation that provides the framework for financial regulation in the United Kingdom. This Act establishes the legal basis for the regulation of financial services and grants powers to the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA), ensuring that these regulators can supervise firms to maintain market integrity, protect consumers, and enhance competition.

FSMA 2000 outlines the roles and responsibilities of these regulators, granting them authority to enforce rules, conduct investigations, and impose penalties for non-compliance. This legislation was pivotal in the establishment of a modern regulatory system following the financial crises that highlighted the need for robust oversight in the sector.

Other options, although related, do not encompass the legislation that directly grants regulatory powers. For instance, the Financial Services Act (FSA) refers to earlier frameworks that were replaced or reformed under FSMA. The FSAP (Financial Services Action Plan) 2000 is more about developing a strategy for harmonizing regulation across Europe rather than giving regulatory powers in the UK. The FCA was established as part of FSMA but is not an act of legislation by itself. Understanding FSMA 2000’s