What type of designated investment business is exempt from TC rules for an RC?

The correct choice, which indicates that arranging is the designated investment business exempt from Training and Competence (TC) rules for a regulated individual, particularly a 'representative' or 'RC', is based on specific regulatory provisions.

In the context of UK financial services regulation, the TC rules established by the Financial Conduct Authority (FCA) apply to certain functions and activities carried out by individuals within financial firms. The purpose of these rules is to ensure that individuals possess the adequate skills, knowledge, and competence to perform their designated roles effectively, thereby protecting consumers and maintaining market integrity.

Arranging refers to facilitating transactions or putting clients in touch with suitable parties without making recommendations or engaging in advisory roles. The exemption from TC rules for arranging activities acknowledges that this function is often more about logistics and process than about exercising judgment or providing tailored financial advice. Consequently, those engaged in merely arranging transactions do not necessarily need to meet the same rigorous training and competency standards as those involved in advising, managing, or dealing, which require a deeper understanding and expertise in delivering financial services and products.

This distinction supports the broader regulatory goal of ensuring that financial advice and management functions are performed by professionals with adequate training, while allowing for a more streamlined approach for simpler, non-advisory