Executive Summary

This document outlines the regulatory requirements and compliance considerations for Independent Financial Advisers (IFAs) operating under the Financial Conduct Authority (FCA) while utilising a remote support team based in North Macedonia. The objective is to ensure that the nearshore team enhances operational efficiency while fully adhering to FCA regulations, UK GDPR, and industry best practices.

1. FCA Regulatory Compliance for Remote Teams

The FCA permits remote and outsourced work but holds UK firms fully accountable for compliance, regardless of location.
Certain regulated activities, such as providing financial advice, client recommendations, and final approval of suitability reports, must remain with FCA-authorised IFAs in the UK.
The remote team can perform administrative, compliance, and research support but must not provide regulated advice.
Oversight and control are critical—UK managers must actively supervise the nearshore team to ensure compliance.

2. Data Protection and Security Requirements

UK GDPR applies to any UK client data accessed by the remote team. Appropriate safeguards, such as Standard Contractual Clauses (SCCs), secure IT frameworks, and access restrictions, must be in place.
The use of company-issued encrypted laptops, VPNs, multi-factor authentication (MFA), and data loss prevention (DLP) tools is required to prevent breaches.
All client data handling must follow “least privilege” access principles, ensuring that remote staff only access what is necessary for their role.
Cybersecurity training and monitoring tools should be implemented to prevent unauthorised data access or leakage.

3. Compliance Focus Areas for Remote Work

Regulatory Oversight: Senior managers (under SM&CR) are responsible for compliance within the nearshore team. The FCA may audit or inspect remote operations.
Record-Keeping: All client interactions, research, and compliance activities must be logged and retained per FCA rules.
Suitability of Advice: The UK IFA must ensure that all client recommendations are individually tailored and FCA-compliant, even if supported by remote research.
Financial Crime & AML Compliance: If remote staff assist with onboarding or transaction monitoring, they must follow UK AML regulations and be trained on red flags.
Operational Resilience: The remote arrangement must not impair business continuity; contingency plans should be in place.

4. Internal Policies to Ensure FCA Compliance

To align with FCA requirements, the firm should implement:

Outsourcing & Oversight Policy: Clear governance, vetting, and monitoring of the remote team.
Remote Working & Communications Policy: Guidelines on permissible communication methods, supervision, and FCA accessibility.
Data Protection & IT Security Policy: Secure data access rules, encryption, and GDPR compliance measures.
Client Data Handling Protocols: Legal safeguards for data transfers and strict access controls.
Compliance Training & Competence Framework: Regular training for the nearshore team on FCA regulations, GDPR, and best practices.
Monitoring & Quality Assurance Process: Periodic compliance checks and audits of remote team outputs.

Conclusion

A nearshore support team in North Macedonia can provide valuable administrative and compliance assistance if properly managed within FCA guidelines. The UK firm remains fully responsible for compliance, and strong governance, cybersecurity, and training protocols must be enforced. By implementing clear internal policies and oversight mechanisms, the firm can ensure that its remote operations meet the FCA’s high regulatory standards while maintaining efficiency and client trust.

FCA Compliance for IFAs with a Nearshore Team in North Macedonia

Independent Financial Advisers (IFAs) in the UK must follow Financial Conduct Authority (FCA) rules even when some support functions are performed by a remote team overseas. Below is a structured overview of key considerations and recommendations to ensure compliance when operating a nearshore support team (e.g. in North Macedonia) under FCA regulation.

1. Regulatory Compliance for Remote Teams

FCA Stance on Remote Working: The FCA does not prohibit firms from using remote or overseas staff, but it will evaluate such arrangements case-by-case to ensure they do not impede the firm’s ability to meet regulatory obligations (The regulatory, risk and tax costs of working remotely overseas) (FCA expectations on hybrid and remote working – LoupedIn). In practice, this means the firm must demonstrate that having a nearshore team does not weaken oversight, control, or client outcomes. The FCA needs to remain satisfied that all regulatory requirements can be met even if some work is done remotely (FCA expectations on hybrid and remote working – LoupedIn).

Outsourcing vs. Retained Responsibilities: Using an overseas support team is considered outsourcing, and the FCA makes clear that firms remain fully responsible and accountable for all regulatory obligations in outsourced activities (Outsourcing and operational resilience | FCA). An FCA-regulated firm cannot delegate away its regulatory responsibility to a third party ([PDF] FG 16/5 Guidance for firms outsourcing to the ‘cloud’ and other third …). In other words, the UK IFA firm and its management retain ultimate responsibility for compliance, even if day-to-day tasks are performed abroad. The Senior Managers & Certification Regime (SM&CR) still applies – senior managers must maintain effective supervision of the remote team and ensure compliance standards are upheld.

Reserved Tasks for FCA-Authorised Individuals: Certain key responsibilities must remain with UK-based FCA-authorised IFAs and cannot be carried out by unregulated overseas staff. Notably:

Giving Investment Advice: Under FCA rules, providing a personal recommendation about investments or insurance is a regulated activity that requires FCA authorisation (FCA guidance on the regulation of advice and personal …). Therefore, only UK-authorised IFAs should formulate and deliver financial advice to clients. The remote team should not give advice or make recommendations to clients (which would constitute regulated advice) (FCA guidance on the regulation of advice and personal …). Their role must be limited to support functions (see below).
Client Communication involving Advice: Any communication that could be construed as financial advice or a recommendation must come from an FCA-authorised adviser. Remote staff can correspond with clients for administrative matters (scheduling meetings, collecting documents, following up on paperwork) but should not discuss or endorse investment products or strategies. All advice-related queries should be handled or approved by the UK adviser.
Final Advice Approval and Suitability Checks: The UK IFA must review and approve all advice documents (e.g. suitability reports, investment proposals) before they go to the client. A nearshore paraplanner may draft reports, but a UK-authorised adviser must sign off, taking responsibility for compliance with suitability rules. The FCA has emphasized that the suitability report is the most important document in the advice process (Why paraplanners should have PI insurance – Citywire) – it should be issued under the UK adviser’s authority, indicating they stand behind the advice given.

Permitted Support Activities: A remote nearshore team can perform administrative and research functions to support the IFA, so long as these do not amount to carrying out regulated activities. For example: preparing file documentation, data entry, compiling product research, producing draft reports, and routine client service inquiries (e.g. status updates) are generally acceptable. Many IFA firms employ paraplanners or admin staff for such tasks, and this can be done remotely. The critical point is that any task that involves exercising judgment on a regulated matter (e.g. recommending a product, assessing suitability) must be done or overseen by the FCA-authorised adviser in the UK.

Oversight and Control: The UK firm must have robust oversight of the remote team’s work. The FCA expects that “control functions such as risk, compliance and internal audit” can operate effectively and monitor remote activities without impediment (FCA to test firms’ remote working arrangements – FTAdviser). This means putting in place controls like: regular check-ins, quality reviews of the work produced by the nearshore team, and clear reporting lines to UK management. The firm should be ready to demonstrate to the FCA how it supervises the remote staff’s work and manages any risks arising from the arrangement. In practice, many firms institute a “four-eyes” principle (review by a UK supervisor) on any client output from the remote team to ensure it meets FCA standards.

Location and Legal Considerations: If the remote team has a physical presence in North Macedonia (or any non-UK jurisdiction), the firm should also consider any local regulatory or legal requirements. The FCA expects firms to have considered the legal implications of operating in another jurisdiction (e.g. local employment law, regulatory permissions, or tax establishment issues) (Remote working – regulated. – Corterum). While North Macedonia does not regulate support services for UK financial advice, the firm should ensure compliance with local labor laws for its employees and confirm that nothing in local law would conflict with UK regulatory duties. Notably, there is no blanket FCA ban on employees of regulated firms working overseas, but the onus is on the firm to ensure all FCA requirements are still met (Do you have employees working overseas? – Doyle Clayton).

In summary, an IFA firm can leverage a nearshore team for support, but must keep regulatory responsibilities firmly in the UK. The FCA will hold the UK firm (and its principals) accountable for any misconduct or advice failings, regardless of the offshore element ([PDF] FG 16/5 Guidance for firms outsourcing to the ‘cloud’ and other third …). Clear limits should be set so the remote staff only perform unregulated support functions, with FCA-authorised advisers retaining control over advice, client outcomes, and compliance decisions.

2. Data Protection and Security

Operating with a remote team handling UK client information brings serious data protection obligations. Both FCA regulations and data protection laws (UK GDPR) require firms to protect client data against unauthorized access or loss, regardless of where staff are located. The FCA explicitly warns that remote working can heighten cyber and data security risks, and firms must take steps to mitigate these risks (FCA turns the screws on compliance in work-from-home environment). Key expectations and best practices include:

Robust IT Security Measures: The FCA mandates that firms have strong IT controls to safeguard sensitive client data from cyber threats (FCA Compliance Requirements: Kiteworks Solution Capabilities). This means ensuring secure access for the North Macedonia team. All connections to client data should use encrypted channels (e.g. VPNs) and multi-factor authentication to prevent unauthorized logins. Systems should be configured to the same security standards as in the UK office. The firm should also maintain up-to-date antivirus/anti-malware protection and firewall rules for remote endpoints. Regular penetration testing and security audits are advisable to verify that remote access points are secure.
Company-Managed Devices Only: It is a best practice to issue business-only, company-managed laptops or devices to all remote team members. Personal devices should not be used for client work, because they might lack proper security or monitoring. In fact, regulators have indicated that firms should prohibit the use of uncontrolled personal devices for business communications in order to ensure oversight (FCA Surveillance Requirements for Regulated Employees Working …). By providing secured corporate laptops, the firm can enforce standard security policies (encryption of data, strong passwords, device locking, etc.) and remotely wipe or disable devices if lost or if a breach is suspected.
Data Access Controls: Implement strict access controls so that the nearshore staff can only access the client data and systems necessary for their role. Use principles of least privilege and role-based access – for example, if the remote team handles only certain clients or tasks, partition those data sets accordingly. Every access to client records should be authenticated and logged. The firm’s IT team should be able to monitor who accessed what data and when. This helps in detecting any unauthorized access or unusual data viewing/exporting by remote users.
Monitoring and Data Loss Prevention: Employ monitoring tools to track and prevent data leakage. For instance, Data Loss Prevention (DLP) software can be used on email and endpoint devices to flag or block any attempt to send sensitive client information outside approved channels. Likewise, disabling or restricting the ability to download, copy, or print client data by the remote team can reduce leakage risk. Regular review of audit logs (for file access, email forwarding, etc.) will help catch any red flags early. The FCA expects firms to have surveillance and monitoring comparable to in-office standards even for remote staff (FCA turns the screws on compliance in work-from-home environment).
Encryption and Secure Data Storage: All client data should be encrypted both in transit and at rest. When the North Macedonia team connects to databases or cloud systems, data transmission must be encrypted (HTTPS, VPN tunneling). Any sensitive documents the team handles should be stored in secure, encrypted drives or document management systems – not on local hard drives if possible. If local storage is unavoidable, full-disk encryption on laptops is essential. Routine secure backups of data should be done, and the FCA advises firms to regularly review backup procedures and consider threats to data (including during transfer) (FCG 5 – FCA Handbook – Financial Conduct Authority).
Cybersecurity Policies and Training: Extend the firm’s cybersecurity policies to cover the remote team. This includes acceptable use policies (e.g. no using personal email for work data, no installing unapproved software), incident reporting procedures, and regular cybersecurity awareness training. Remote staff should be educated on phishing risks, social engineering, and how to handle client data securely. A strong security culture is expected by the FCA even in a remote environment (FCA Update: Remote-Hybrid Work Expectations For Firms). The firm should also have a response plan for cyber incidents – if a data breach or cyber attack occurs involving the remote team, it must be handled and reported (to the ICO/FCA) in line with regulatory requirements.

In short, data security for a remote team must be as rigorous as for onshore staff. The FCA emphasizes that firms must “take special care of their customers’ personal data” and comply with data protection principles (FCG 5 – FCA Handbook – Financial Conduct Authority). By using dedicated secure equipment, monitoring for data leaks, and enforcing strong cybersecurity controls, the firm can meet FCA expectations and protect client information. Document these measures in an IT security policy that covers the nearshore arrangement, and periodically verify compliance (e.g. perform IT audits on the North Macedonia office or service provider).

3. Client Data Handling and Access Restrictions

When an overseas team handles UK client data, there are important data protection and privacy laws to consider, as well as FCA confidentiality expectations. Key points include:

UK GDPR and International Transfers: UK client information is protected under the UK General Data Protection Regulation (UK GDPR). Providing access to personal data to a team based in North Macedonia constitutes an international data transfer in the eyes of data protection regulators (A guide to international transfers – ICO). (North Macedonia is not part of the EU/EEA, and currently not on the UK’s adequacy list, so it is considered a third country for data transfer purposes.) The law allows such transfers only if specific safeguards are in place. In practice, the UK firm (data controller) must ensure there is a lawful transfer mechanism, such as Standard Contractual Clauses (SCCs), in any contract with the non-UK team or entity (A Step but Not Quite a Leap – the ICO’s New Approach to Restricted …). These SCCs are legal clauses approved by regulators to oblige the overseas recipient to protect the data to UK standards. If the North Macedonia team is employed by a separate outsourcing company, a Data Processing Agreement containing SCCs and clear data protection obligations is mandatory. Even if the team members are employed directly by the UK firm (no separate legal entity), it’s wise to treat their access as a restricted transfer and implement equivalent safeguards and documentation.
GDPR Compliance and Policies: Beyond the transfer mechanism, all principles of GDPR/UK Data Protection Act must be adhered to. This means client data should be processed lawfully, for the intended purpose, and kept only as necessary. The remote team should follow the same data handling rules as UK staff. For example, personal data minimisation (only access data needed for the task), accuracy (ensure data is up to date), and integrity and confidentiality (secure processing) are all relevant. The firm’s privacy notice should disclose that personal data may be accessed by staff in other countries, so clients are informed transparently. Additionally, the firm might conduct a Transfer Risk Assessment to evaluate any local risks to data (e.g. could Macedonian government agencies access the data, and if so, is that compatible with GDPR protections?). While this is more of a GDPR exercise than an FCA rule, it’s part of demonstrating due diligence in protecting client data.
Access Restrictions and Need-to-Know: The firm should enforce strict access controls on client data for the remote team. Only those client files or databases required for their support role should be accessible to them. For instance, if the team’s role is limited to preparing portfolio valuation reports, they might only need access to portfolio data and client names/addresses – possibly not full financial planning notes or unrelated client files. Using segregated systems or secure portals for the remote team can help limit exposure. All access by the nearshore team should be logged, as noted earlier, and ideally subject to managerial review.
No Unauthorized Data Copying or Storage: Policies should forbid the remote team from downloading or storing client data locally outside of the firm’s controlled systems. They should work on the firm’s cloud or server environment whenever possible, so data remains on UK-based servers (or in cloud servers compliant with UK data rules). If, for example, a spreadsheet with client info is generated, it should be saved on the firm’s secure network, not on a personal hard drive or unapproved cloud service. This prevents uncontrolled proliferation of client data. Likewise, remote staff should not share client data with any third parties unless explicitly authorised as part of a vendor service (and covered by contracts).
Confidentiality Agreements: It’s prudent to have each remote team member sign confidentiality or non-disclosure agreements that specifically acknowledge the sensitivity of UK client data. While employees are typically bound by employment contracts, if the team is employed through an outsourcing provider, ensure that provider contractually requires its staff to maintain confidentiality and comply with UK-level data protection standards. The FCA expects firms to protect customer confidentiality; any breach of client data could not only violate GDPR but also FCA Principle 3 (management and control) or Principle 6 (treating customers fairly) if it causes harm.
UK FCA and ICO Coordination: Remember that data protection is regulated by the ICO (Information Commissioner’s Office) in the UK. A data breach or misuse by the remote team could lead to ICO investigation and fines under GDPR, in addition to FCA scrutiny for operational failures. FCA Handbook SYSC rules implicitly require protecting client data as part of running a controlled business (FCG 5 – FCA Handbook – Financial Conduct Authority). Thus, compliance officers should include the nearshore data handling in their oversight. In the event of a serious data incident, the firm may need to notify both the ICO (under GDPR breach notification rules) and possibly the FCA (if it constitutes a significant operational or security incident).

In summary, a remote team can access and work with UK client data, but only under stringent conditions that uphold UK data protection standards. The firm should implement a strong data governance framework: legal data transfer agreements, technical access restrictions, and employee confidentiality training. By doing so, the firm complies with GDPR/UK law and meets the FCA’s expectations that customer data is handled with due care and security even when staff are abroad (FCG 5 – FCA Handbook – Financial Conduct Authority). Always err on the side of caution – if there’s any doubt whether sharing certain client information to the remote location is permitted or necessary, consult with compliance/legal advisors and document the rationale and protections in place.

4. FCA Compliance Focus Areas for Remote Work

When supporting IFAs with a nearshore team, the core FCA compliance requirements remain the same. Remote working does not exempt the firm from any regulatory obligations. In fact, the FCA has highlighted several focus areas to watch closely in a remote or outsourced setup:

Management Oversight & Control: The firm must maintain effective oversight of the remote team. Senior management (under SM&CR) should have clear lines of responsibility for the outsourced functions. The FCA will expect evidence that managers can supervise the North Macedonia team as robustly as on-site staff. This could include regular video meetings, documented work reviews, and perhaps periodic in-person visits to the remote office. Notably, outsourcing arrangements must not hinder regulators’ access to information or staff – the FCA’s rules (SYSC 8) state that outsourcing should not limit the FCA’s ability to supervise the firm (Outsourcing and Third Party Risk Management – Xcina Consulting). The firm should be prepared to facilitate FCA access to the remote team’s work and records if requested (and staff should know that the FCA could visit or audit their operations). In fact, the FCA has indicated it has power to visit any location where regulated work is being done, including employees’ home offices if necessary (REMOTE OR HYBRID WORKING – REGULATORY … – Comsure). Ensuring the remote team is aware of regulatory scrutiny is part of maintaining a compliant culture.
Record-Keeping: Regulatory record-keeping requirements apply regardless of where staff are located. All client interactions, advice given, transactions arranged, and compliance checks need to be properly recorded and retained according to FCA rules (e.g. MiFID investment advice records typically must be kept at least 5 years). The remote team’s activities (emails, research notes, etc.) that form part of the client’s file should be captured in the firm’s record-keeping system. Firms should avoid situations where important information is only stored locally with the remote team or on unofficial channels. For example, if the nearshore staff communicate internally about a client case via chat or email, those communications might need to be saved to the client file if they influence advice. Internal communications related to advice might fall under FCA recording rules (the FCA has noted even internal chats leading up to advice may need recording in some contexts) (FCA expectations on remote working oversight and monitoring). As a best practice, use company-approved communication tools that are logged (e.g. firm email accounts, CRM notes) rather than personal messaging apps. Proper record-keeping not only is a regulatory must but also protects the firm in demonstrating compliance (e.g. evidence that suitability was considered, or what instructions the adviser gave to the paraplanner).
Suitability of Advice: Suitability remains a cornerstone of FCA requirements for investment advice (COBS 9). The involvement of a remote team does not change the need to collect adequate client information (KYC) and to ensure recommendations are suitable for the client’s objectives and risk profile. The UK IFA must ensure that the paraplanning support enhances, not detracts from, this process. For instance, if the nearshore team helps draft the fact-find summary or risk assessment analysis, the adviser should double-check its accuracy. The FCA has repeatedly stressed the importance of suitability – as noted, the suitability report is critical (Why paraplanners should have PI insurance – Citywire) – so the firm should have compliance checks in place. Possibly, a compliance officer or second pair of eyes (in the UK) should review a sample of cases to ensure that using a remote team has not introduced any errors or generic advice. Each client must still receive personalised, suitable advice. Documenting the rationale for recommendations is key. If the remote team prepares the first draft of a recommendation, ensure the final rationale reflects the adviser’s judgement and is communicated clearly to the client.
Quality of Client Communication: All client communications, whether coming from the UK adviser or drafted by the remote support, should meet FCA standards (clear, fair, not misleading – per FCA Principle 7). If the nearshore team corresponds with clients for administrative reasons, those communications should be professional and accurate. Set guidelines for the tone and content that remote staff can use, and have compliance do spot-checks of emails or letters going out. For example, a remote administrator replying to a client’s request for information should provide factual details but avoid making any comment that could be construed as advice or an FCA-regulated “assurance.”
Data Protection & Privacy: As elaborated in sections 2 and 3, protecting client data is a critical compliance area, especially with remote access. The FCA will focus on whether the firm has taken reasonable steps to prevent data breaches or unauthorised use of data. This ties into operational risk management – poor data security is seen as a failure of operational controls. During any FCA supervisory review, they may ask how the firm ensures the remote team abides by confidentiality and data protection rules. The compliance team should be ready to demonstrate measures like those discussed (access controls, training, DLP, etc.). Any data breach or loss of client data due to the remote arrangement would likely draw FCA attention (and ICO enforcement), so strong preventative controls are essential.
Financial Crime and Client Identity Security: Remote working arrangements should be assessed for any impact on anti-financial crime controls. For example, if the nearshore team assists with client onboarding or monitoring transactions, are they following the firm’s Anti-Money Laundering (AML) procedures properly? The firm must ensure that having a team overseas does not weaken AML/KYC checks. Remote staff might not have the same local knowledge as UK staff, so training them on UK AML red flags is important. The FCA expects firms to cascade policies and procedures to reduce any potential financial crime risks in remote setups (Remote-Hybrid Working Guidance from the FCA – Sturgeon Ventures). Similarly, consider client authentication: if remote staff interact with clients via email or phone, make sure they adhere to security protocols (e.g. verifying identity before discussing sensitive info) to prevent fraud or impersonation.
Outsourcing and Operational Resilience: The FCA’s rules on outsourcing (SYSC 8) and new operational resilience requirements (applicable to many financial firms) emphasize that critical services must be delivered safely even when outsourced. The firm should identify if the functions performed by the North Macedonia team are “important business services.” If yes (for example, if a failure by the remote team could significantly impact clients), then under operational resilience guidance the firm should have plans to quickly recover from any disruption at the nearshore location (Operational Resilience – Is Outsourcing on your Radar? – Ruleguard). This could include having backup processes in the UK if the remote team is unavailable. Additionally, FCA guidance on outsourcing requires thorough due diligence and ongoing monitoring of the service provider or remote office. The compliance team should maintain an outsourcing register documenting the arrangement and periodically review performance against KPIs and compliance standards. If the remote provider changes or there are risk issues, senior management and possibly the FCA should be kept informed. Essentially, treat the nearshore team as an integral part of the firm’s operations, subject to the same risk management and continuity planning as any in-house department.
Regulatory Reporting and Communication: Ensure that remote working does not impede the firm’s ability to communicate with regulators or clients. The FCA expects firms to remain accessible – for example, the firm’s UK head office must still be the primary point of contact for FCA queries and for clients. The presence of an overseas team should be invisible in terms of regulatory interface: clients should contact the firm through normal UK channels, and if the FCA requests information or an interview, the firm should not defer to “the overseas team” – instead, UK management should produce information (which they should have access to) and be accountable. If any regulatory notifications are required (for instance, a Form D if a significant outsourcing might be considered a material change), make sure to handle those in a timely fashion. Generally, small IFA firms may not need to notify the FCA of administrative outsourcing, but if in doubt, seek advice or proactively discuss with the FCA supervisor.

In summary, remote working arrangements must be compliant with all existing FCA rules. The key is that nothing about having staff overseas should cause a drop in compliance standards or regulatory coverage. Firms are expected to have an equivalent level of control and supervision as they would in a wholly UK-based model (FCA turns the screws on compliance in work-from-home environment). By focusing on strong oversight, record-keeping, suitability processes, data protection, and risk management, the firm can satisfy the FCA that the nearshore team is not a weak link. It’s wise for the firm’s compliance officer to regularly review the remote setup specifically against FCA requirements and document that review. This way, if the FCA ever inquires (or even conducts a remote working supervision visit), the firm can show a thoughtful approach to maintaining compliance across borders.

5. Developing Internal Policies for FCA Compliance

To operationalize all the above, the IFA firm should develop clear internal policies and procedures that align with FCA expectations for managing a remote nearshore team. Some recommendations and best practices for internal policies include:

Outsourcing Policy & Oversight Procedure: Create a formal Outsourcing Policy that covers how the firm selects, monitors, and controls any outsourced or overseas functions. This policy should state that the firm retains accountability for all outsourced tasks ([PDF] FG 16/5 Guidance for firms outsourcing to the ‘cloud’ and other third …) and outline management’s responsibilities in overseeing the nearshore team. Include requirements for due diligence (e.g. vetting the service provider or remote staff qualifications), risk assessments before outsourcing, and approval steps (perhaps Board or senior manager sign-off) for any critical outsourcing. Also describe the ongoing oversight: for example, conducting quarterly performance reviews, compliance audits of the remote team’s work, and an annual on-site visit (if feasible) to the North Macedonia office to audit security and adherence to procedures. Keeping an Outsourcing Register (a log of all material outsourcing arrangements and their risk ratings) is considered good practice and is required for certain firms under FCA/PRA rules – it helps demonstrate you know what functions are outsourced and how they’re controlled.
Remote Working & Communications Policy: Develop a policy that governs remote work arrangements. This should apply to both domestic remote work and international teams. It would include rules such as: which communication channels are approved for business use (company email, official phone systems, approved video conferencing); prohibition of using personal email or messaging for client business; expectations for availability and responsiveness; and how managers will supervise remote staff. For an overseas team, it might also cover working hours coordination with the UK, language requirements for communication, and a protocol for escalating any client issues to UK advisers promptly. The policy can reinforce that the same conduct rules and ethical standards apply to remote staff as to onshore staff. It should also note that the FCA or firm’s compliance may conduct checks on remote working areas (emphasizing that work-related data must remain accessible to the firm and regulators). Ensuring remote employees understand the FCA can visit or audit any work location is an important point to include, echoing the FCA’s own guidance (REMOTE OR HYBRID WORKING – REGULATORY … – Comsure).
Information Security & Data Protection Policy: Update or extend the firm’s InfoSec policy to explicitly include the nearshore team. Detail the required security measures for remote access (as discussed in section 2) – for example, “All overseas team members must use company-issued encrypted laptops and connect via the company VPN with MFA.” Include rules on password management, device use, incident reporting, etc. The policy should also cover data protection compliance: e.g., “Client data may only be accessed for legitimate business tasks and must not be stored locally in North Macedonia except as permitted by IT security protocols.” If Standard Contractual Clauses are used, the policy can reference that the firm and the offshore provider (or branch) are contractually bound to GDPR standards. Essentially, this policy is where you incorporate GDPR requirements into everyday practice for the remote team. It might also set out that periodic training on data protection is mandatory for the nearshore staff. By codifying these rules, the firm can demonstrate to the FCA/ICO that it has documented controls in place to protect client data when staff work remotely (FCG 5 – FCA Handbook – Financial Conduct Authority).
Client Data Access Protocols: As a subset of data policy, have a clear internal protocol for granting and revoking access to client information for the remote team. For example, when a new team member in North Macedonia is onboarded, what steps must IT and Compliance take before they can access systems? (Background checks, least-privilege setup, confidentiality agreements signed, etc.) And if someone leaves the team, ensure immediate revocation of access. Define what types of client data the remote team is allowed to handle. If there are certain particularly sensitive cases or high-net-worth clients that the firm decides should only be handled in the UK, note that. This kind of granular approach can prevent any ambiguity about the scope of the remote team’s role.
Training and Competence: Introduce a policy or procedure for training remote staff on FCA compliance and UK regulations. Even though the nearshore team aren’t FCA-approved persons, they should still be made aware of key regulatory concepts relevant to their work (e.g. what is a regulated advice vs. generic information, data privacy expectations, TCF – Treating Customers Fairly principles, etc.). Many firms include overseas staff in their regular compliance training via webinars. Also consider the Competence aspect: IFAs in the UK have to maintain qualifications and knowledge; similarly, remote paraplanners should be encouraged to attain relevant industry knowledge (perhaps UK financial planning certificates, even if not mandated). Have the UK compliance officer or training lead periodically test the remote team’s understanding of policies (quizzes or checklists). A well-trained support team is less likely to inadvertently breach FCA rules. Maintain records of all training given to the remote team as evidence.
Monitoring & Quality Assurance: Develop an internal QA process for the work produced by the remote team. For instance, create a checklist that UK advisers or compliance reviewers use when reviewing outputs from the nearshore team (checking that all advice documentation prepared by the team meets FCA rules, all client communications are logged, etc.). The policy could state that a certain percentage of cases handled with remote support will be audited by the compliance department. This ensures any issues are caught and corrected. Document these reviews to build a compliance audit trail. If the remote team is managed by a specific UK-based manager, that manager’s performance objectives should include maintaining compliance standards in the team’s work. Essentially, bake compliance monitoring into the management routine.
Incident Reporting and Escalation: Update your internal incident reporting procedures to account for the remote team. Staff (including overseas staff) should know how to report any data breach, compliance concern, or client complaint up the chain. For example, if a North Macedonia team member realizes they sent an email to the wrong client or encountered a suspicious request, they must alert the UK compliance officer immediately. Establish points of contact in the UK for the remote team to consult on compliance questions in real time. Quick escalation can prevent small issues from becoming regulatory breaches.
Examples of Best Practices from Other Firms: Many financial firms with remote or outsourced teams have instituted controls such as daily team videoconferences to discuss cases, shared compliance dashboards, and periodic rotation of staff (bringing offshore staff to the UK for training). While not every practice suits all, consider implementing: regular compliance attestations (the remote team periodically certifies they are following policies and have reported all issues), whistleblowing channels accessible to remote employees (so they can report malpractice if they see it), and inclusion of the remote office in the firm’s internal audit schedule. For instance, if the firm has an internal auditor or uses an external consultant, have them review the North Macedonia operations for adherence to procedures. This level of oversight will be viewed favorably by regulators as a sign of a strong compliance culture.
Continuous Improvement: Finally, set a policy that the arrangement with the nearshore team will be reviewed at least annually from a compliance perspective. Use that review to update policies as needed. The regulatory environment can change (for example, new FCA guidance on technology or updated GDPR rules), so ensure the remote working policies evolve accordingly. Solicit feedback from the remote team too – they might spot practical difficulties in following a policy, which you can then refine. A collaborative approach will make the policies more effective and actually practiced, not just paper directives.

By developing the above internal policies and procedures, the firm creates a framework that instills FCA compliance into the day-to-day operations of the nearshore team. It’s important not only to have these policies but to implement and enforce them consistently. The FCA will expect firms to be able to demonstrate their controls in action – for example, showing a written procedure and then showing evidence (logs, reports, training records) that it’s being followed. Good documentation is key.

In conclusion, supporting UK IFAs with a team in North Macedonia is feasible under FCA rules, but it requires careful structuring. The firm should treat the remote team as an extension of itself, subject to the same regulatory rigour as the UK office. By clearly delineating responsibilities (keeping advice and key decisions with UK authorised persons), securing client data, adhering to GDPR, maintaining thorough compliance oversight, and establishing strong internal policies, the firm can reap the benefits of a nearshore team while remaining fully compliant with FCA requirements. The overarching principle is that customer interests and regulatory standards must not be compromised by the location of staff – if that principle guides all decisions, the firm will be well-placed to satisfy both the FCA and clients that its remote operating model is sound and secure (FCA expectations on hybrid and remote working – LoupedIn) ([PDF] FG 16/5 Guidance for firms outsourcing to the ‘cloud’ and other third …).