Which type of designated investment business is subject to TC rules for an RC?

The correct choice reflects the scope of the TC rules in relation to regulated activities, particularly focusing on the interactions with retail clients. The TC rules, which stand for Training and Competence rules, are designed to ensure that firms and individuals engaging in certain financial services possess the necessary skills and qualifications to operate effectively and ethically. This is especially crucial when dealing with retail clients, who typically have a lower level of financial sophistication compared to institutional clients.

Retail clients rely heavily on the advice and services provided by financial professionals, making it essential that those professionals are adequately trained to understand the complexities of the products and services they're recommending. Activities such as advising, dealing, managing, or overseeing investments for retail clients directly fall under the ambit of TC requirements, as they are focused on ensuring that staff members are suitably qualified to meet the needs of less experienced investors.

In contrast, managing investments for institutional clients, arranging corporate finance deals, and providing independent financial analysis may not require the same level of client safeguarding as activities involving retail clients. Therefore, option B correctly identifies the type of designated investment business that is subject to TC rules for an RC due to the heightened need for consumer protection and assurance of professional integrity when engaging with retail clients.