Reverse Solicitation in Financial Services (US, EU, and UK Guide)
Sep 17, 2025
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17 min read
Contents
Reverse solicitation is a concept that surfaces often when fintechs and financial firms explore cross-border opportunities. It refers to situations where a client approaches a provider entirely on their own initiative, without being prompted by advertising or outreach.
For founders and compliance officers, it can seem like a shortcut to serving customers abroad without going through local licensing. However, as this guide will show, it is a narrow exception, not a growth strategy.
This article explains how the United States, the European Union, and the United Kingdom treat reverse solicitation. It unpacks what the rules say, which regulators oversee them, and how fintech firms should approach the risks of reverse solicitation.
InnReg is a global regulatory compliance and operations consulting team serving financial services companies since 2013. If you need assistance with compliance or fintech regulations, click here.
What Reverse Solicitation Means in Financial Services
Reverse solicitation describes a situation where a client requests a financial product or service entirely on their own initiative, without being approached or induced by the provider.
Regulators in different jurisdictions use this concept to determine when a financial services firm may serve a client outside its licensed region without triggering local licensing rules.
In practice, the threshold is strict. Any form of marketing, promotion, or other activity that directly or indirectly targets clients in a jurisdiction can disqualify a firm from relying on reverse solicitation. That includes online advertising, targeted SEO, or even hosting a website in a local language. For regulators, the client’s exclusive initiative is the decisive factor.
For fintechs and investment firms, reverse solicitation usually comes up when clients from outside the company’s licensed jurisdiction try to sign up or request services.
In each case, the firm must consider whether providing the service without local authorization is permissible. While the rules differ across the US, EU, and UK, the principle is consistent. Reverse solicitation applies to very narrow circumstances, and even then, regulators are likely to view it with skepticism.
Why Reverse Solicitation Matters for Cross-Border Business
As entering a new market often requires time, capital, and deep regulatory work, some startups view reverse solicitation as a shortcut.
If a client in another country reaches out on their own initiative, some founders see it as a chance to serve that client without going through the licensing process. This is especially tempting in digital-first models where anyone can access a website or app globally.
However, that approach is problematic and can lead to regulatory risks as regulators do not view reverse solicitation as a broad pathway for business growth. They see it as a narrow exception meant for isolated cases. When a firm accepts multiple “unsolicited” clients from a single jurisdiction, it often signals that some form of marketing or inducement is at play. Regulators are quick to challenge those claims.
As such, firms should always treat a reverse solicitation as an exception to document and manage, not a growth strategy. Instead of leaning on this concept, companies planning to expand globally typically need a structured compliance roadmap.
Reverse Solicitation: Overview Across the US, EU, and UK
Regulators in the US, EU, and UK approach reverse solicitation with different levels of recognition. For fintech firms operating across borders, these differences may create both legal risks and operational hurdles.
The table gives a side-by-side overview of the regional differences:
Jurisdiction | Reverse Solicitation | Main Regulators | Key Points for Fintechs |
|---|---|---|---|
US | No broad exemption. Limited allowance for unsolicited trades under SEC Rule 15a-6 (broker-dealers). No equivalent for advisors or funds. | Any business with US clients usually requires registration. Disclaimers and client attestations do not protect against enforcement. | |
EU | Explicitly recognized under MiFID II, MiFIR, and MiCA. Very narrow and strictly interpreted. | ESMA + national regulators | Only valid if the service is at the client’s exclusive initiative. No cross-selling allowed. Disclaimers alone are not sufficient. Heavy enforcement focus post-Brexit. |
UK | No formal statutory exemption. Relies on the Financial Promotion Regime and Overseas Persons Exclusion (OPE). | Client initiative may help in isolated cases, but the FCA applies a broad definition of “inducement.” UK authorities expect overseas firms to avoid marketing and, in most cases, seek authorization. |
Reverse Solicitation in the United States
The US does not recognize reverse solicitation as a general exemption from licensing. The fact that a US client approaches a foreign firm on their own initiative does not exempt that firm from US registration requirements.
A foreign broker-dealer, investment advisor, or platform providing services to US clients must either register or qualify for a narrow exemption. Reverse solicitation itself is not a recognized safe harbor.
However, there are limited allowances, such as SEC Rule 15a-6 for broker-dealers. It permits foreign firms to accept unsolicited orders from US investors in securities transactions, but only under strict conditions and usually with a US-registered intermediary involved. Beyond this, there is no equivalent exemption for investment advisors, funds, or fintech platforms.
SEC, FINRA, and CFTC Perspectives
Several agencies share responsibility for financial regulation in the US, and each takes a strict view of foreign firms serving US clients:
SEC: Oversees securities markets, broker-dealers, and investment advisors. The SEC’s position is clear: foreign firms dealing with US clients must register or fit into narrow exemptions, such as the foreign private advisor exemption for investment managers or Rule 15a-6 for broker-dealers. The agency interprets “doing business” broadly, so even minimal engagement with US investors may trigger oversight.
FINRA: Acts as the frontline regulator for broker-dealers. FINRA often detects cross-border activity through client complaints or transaction monitoring. Its stance is that recurring or ongoing dealings with US clients, even if framed as unsolicited, show that the firm is conducting business in the US and therefore must be licensed.
CFTC: Regulates derivatives and commodities trading. Like the SEC, it does not recognize unsolicited requests as a general exemption. Any ongoing US client relationship in futures, swaps, or commodities can fall within its jurisdiction.
State regulators also play a role. Even if a federal exemption applies, firms may still face licensing obligations at the state level.
How US Rules Affect Foreign Firms Serving US Clients
Regulators look beyond formality and examine the substance of the relationship. If there is a pattern of serving US clients, or if services appear accessible to them, registration obligations may apply.
This means that firms cannot rely on technicalities or disclaimers; they need to think carefully about whether regulators could interpret their operations as targeting US investors.
The main implications for a foreign fintech or investment platform include:
Disclaimers don’t work. A statement that the client approached the firm voluntarily carries no legal weight.
Client attestations aren’t sufficient. Signed letters confirming client initiative will not protect a firm if regulators believe the firm marketed or provided services unlawfully.
Small numbers may help. Exemptions such as the foreign private advisor exemption apply if a firm has fewer than 15 US clients and no significant US presence. This is not a reverse solicitation, but rather a separate exemption.
To summarize, the US regulators prioritize investor protection. If a fintech knowingly serves US clients, it should plan for registration or structure operations to mitigate the risk exposure.
Interaction With Global Fundraising and Marketing
Reverse solicitation is also raised in the context of fundraising. For example, a foreign fund marketing to investors abroad may receive interest from a US investor. In that scenario, the fund must still comply with US private placement rules, such as Regulation D or Regulation S, and in most cases file a Form D notice if US investors participate.
See also:
Reverse Solicitation in the European Union
The European Union formally recognizes reverse solicitation in several key regulatory frameworks, including MiFID II, MiFIR, and MiCA. However, the EU’s interpretation is among the strictest globally. Regulators have made clear that reverse solicitation is a narrow exemption intended for exceptional circumstances, not a tool for sustained market entry.
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MiFID II and MiFIR Provisions
Under MiFID II (Article 42), non-EU firms may provide investment services to clients in the EU if, and only if, the client approached the firm on their own exclusive initiative. This provision recognizes that investors sometimes seek out foreign providers independently, without being marketed to.
MiFIR reinforces this principle by making clear that firms cannot turn unsolicited contact into an open door for broader business activity. In other words, a firm may respond to a client’s initial request, but it cannot treat that contact as a springboard for further marketing or cross-selling.
The rules place two important boundaries on firms:
1. Service-Specific Limitation | 2. No Cross-Selling or Inducements |
|---|---|
The exemption applies only to the exact product or service requested. If a client contacts a broker to execute a single transaction, the firm cannot later offer them portfolio management or structured products without proper authorization. | Any effort to expand the relationship beyond the original request is considered solicitation. Even suggesting additional services, sending follow-up promotions, or recommending other products would disqualify reliance on the exemption. |
For fintech firms, reverse solicitation under MiFID II is essentially a one-off exception. It does not provide a sustainable model for serving EU clients at scale. Regulators also expect firms to document these cases carefully, since the burden of proof falls on the provider if challenged.
In practice, this makes reverse solicitation under MiFID II useful only in limited circumstances, such as accommodating a genuinely unsolicited trade or inquiry. For broader market entry, firms need to pursue licensing, partnerships, or recognized passporting mechanisms.
MiCA Rules For Crypto Services
The Markets in Crypto-Assets Regulation (MiCA), which came into effect in phases between 2024 and 2025, represents a turning point for digital asset oversight in the EU. Among its many provisions, Article 61 establishes rules for reverse solicitation in the crypto sector. Similar to MiFID II, it allows non-EU firms to provide services to EU clients only when those clients reach out entirely on their own initiative.
What makes MiCA stricter is the emphasis on what counts as solicitation. The regulation makes clear that even indirect or digital forms of outreach, such as targeted online advertising, region-specific SEO, a local-language version of a website, or in-app notifications, will disqualify a firm from claiming reverse solicitation. In practice, this means that many common growth tactics used by crypto platforms could inadvertently create the impression of solicitation, closing off the exemption.
For Crypto-Asset Service Providers (CASPs), this has serious operational implications. Responding to one EU client request is permissible, but using that request as a channel to market additional services is not. Firms must also be prepared to document unsolicited requests thoroughly, since regulators are likely to challenge claims of reverse solicitation. ESMA has already issued guidelines clarifying that disclaimers or signed client acknowledgments are insufficient if other evidence points to solicitation.
Read our MiCA regulation guide to learn more →
AIFMD, UCITS, and Fund Marketing Restrictions
Reverse solicitation also appears in the European fund marketing landscape under the Alternative Investment Fund Managers Directive (AIFMD) and the Undertakings for Collective Investment in Transferable Securities (UCITS) regime. Both frameworks regulate how firms can market funds to EU investors, and both take a restrictive approach to unsolicited client interest.
Reforms to AIFMD introduced a concept of “pre-marketing.” This refers to informal efforts to gauge investor interest, such as circulating draft fund documents or testing appetite for a strategy. Under the updated rules, if an investor subscribes to a fund within 18 months of pre-marketing activity, the investment is automatically deemed to result from solicitation, not reverse solicitation.
This closes a loophole that fund managers once relied on. Previously, some would claim investors approached them independently after early conversations. Regulators now consider any investment following pre-marketing as solicited, even if the investor later initiates contact.
For UCITS funds, the same logic applies. Firms cannot use reverse solicitation as a workaround for cross-border distribution rules. Any activity that resembles promotion, whether presentations, roadshows, or targeted materials, counts as marketing. Firms that later try to claim reverse solicitation risk sanctions if they cannot prove the investor’s initiative was completely independent.
National Variations and Regulator Expectations
While EU rules set the baseline for reverse solicitation, enforcement is carried out by national regulators. Each member state applies its own emphasis, and fintech firms need to understand that expectations can differ depending on the jurisdiction.
For example:
France (AMF): The French regulator has been particularly active in challenging misuse of reverse solicitation. In one case, it fined a firm for collecting client letters claiming unsolicited initiative when evidence showed marketing had taken place. The AMF’s position is that documentation alone is insufficient if the facts indicate solicitation.
Germany (BaFin): BaFin has issued repeated warnings that firms “focusing on the German market” require local authorization. Disclaimers on websites or pop-up boxes cannot override marketing activity such as German-language content, local contact information, or tailored advertising.
Italy (CONSOB): CONSOB has emphasized that cross-border services directed at Italian investors are tightly regulated. Even indirect marketing, such as promotional material appearing in Italy, can disqualify reverse solicitation claims.
For fintech and investment firms, these national differences mean that compliance cannot rely on a “one-size-fits-all” approach. A website or campaign that may pass scrutiny in one jurisdiction could raise red flags in another.
Documentation Requirements
In the EU, firms that rely on reverse solicitation are expected to maintain robust documentation. Regulators place the burden of proof on the provider, not the client. If challenged, a firm must demonstrate that the relationship began solely at the client’s initiative.
While national regulators interpret requirements slightly differently, most expect firms to keep records that show:
Client’s Initial Request: Timestamped evidence that the first approach came from the client (e.g., inbound email, website inquiry form).
Attestation of Initiative: A written or digital declaration from the client confirming that they acted independently and were not contacted by the firm.
No Prior Outreach: Internal logs or CRM entries showing that the firm did not market or solicit that client before the request.
Service Limitation: Clear records that the firm only provided the specific service requested and did not cross-sell or expand the relationship.
It is important to note that documentation is necessary but not sufficient. Regulators like the AMF in France have sanctioned firms that relied on signed client letters while evidence showed active marketing. Disclaimers, checkboxes, or client declarations cannot override facts.
ESMA Guidance and Recent Updates
The European Securities and Markets Authority (ESMA) plays a central role in shaping how reverse solicitation is applied across the EU. While national regulators handle enforcement, ESMA issues statements and guidelines to promote consistency and close gaps that firms might otherwise exploit.
In 2021, ESMA issued a strong reminder clarifying that firms cannot use reverse solicitation under MiFID II to maintain EU clients through disclaimers or contractual wording. It specifically warned firms that adding a “self-initiative” box to client onboarding forms is not sufficient when other evidence indicates marketing or solicitation took place.
In 2024, ESMA finalized guidelines under the new Markets in Crypto-Assets Regulation (MiCA), which further restricted the circumstances in which reverse solicitation could apply. The guidance listed practical examples of what counts as solicitation, including:
Using a local-language website or country-specific domain.
Running targeted online advertising or SEO aimed at EU residents.
Sponsoring events or distributing promotional material within the EU.
Sending app notifications or in-platform messages that encourage trade.
These guidelines confirm that even indirect or digital activity can disqualify reliance on the exemption.
ESMA has also pushed national regulators to increase supervision of firms relying on reverse solicitation. Some regulators now require annual reports on the number of clients acquired under this exemption, with unusually high numbers triggering additional review. Enforcement cases, such as the French AMF fining a firm that relied on client letters while still marketing actively, reflect this stricter approach.
See also:
Reverse Solicitation in the United Kingdom
The UK does not recognize reverse solicitation as a formal exemption in the same way the EU does under MiFID II or MiCA. Instead, UK rules rely on broader frameworks under the Financial Services and Markets Act (FSMA), in particular the Financial Promotion Regime and the Overseas Persons Exclusion (OPE), which regulate when overseas firms can interact with UK clients.
Post-Brexit Rules and FSMA Framework
Following Brexit, the UK lost access to EU passporting rights, making cross-border client relationships more complicated. Under FSMA, it is generally unlawful to make a “financial promotion” to UK clients unless the Financial Conduct Authority (FCA) has authorized the firm or an authorized entity has approved the promotion.
The UK defines “promotion” broadly, meaning that even seemingly passive actions, such as operating a website accessible to UK clients, may be caught.
The Overseas Persons Exclusion (OPE) historically gave some leeway to foreign firms dealing with UK clients on their initiative. However, reforms such as the Financial Services Act 2021 narrowed its application, especially where active solicitation has taken place.
FCA Interpretation and Enforcement Stance
The FCA applies a substance-over-form test when evaluating whether a foreign firm has solicited UK business. Factors such as targeted advertising, use of UK contact details, or holding events in the UK can all count as inducements. Even if a client signs a declaration stating they acted on their own initiative, the FCA may still view the firm as soliciting if the broader facts point in that direction.
The FCA also takes enforcement seriously. Overseas firms that maintain ongoing relationships with UK clients without authorization risk regulatory action. As in the EU, disclaimers and self-certifications are not sufficient protection.
Implications for Crypto and Fintech Firms (UK Clients)
For crypto platforms, robo-advisors, and other fintechs serving retail or institutional clients in the UK, the reverse solicitation exemption is extremely limited in practice. The FCA has repeatedly stressed that operating a website or app accessible to UK residents may amount to a “financial promotion,” even if the firm claims not to have directly targeted those clients.
This position is especially relevant for digital-first businesses. Features that may look neutral from a design perspective, such as displaying prices in GBP, providing customer support in English with UK contact numbers, or tailoring marketing content for UK search engines, can all be viewed as inducements. The fact that many fintech growth strategies rely on digital channels only increases the regulatory risk.
For crypto-asset businesses, the restrictions are even tighter. Since October 2023, crypto promotions to UK consumers have fallen under the FCA’s financial promotions regime. This means that firms cannot rely on reverse solicitation if their apps, websites, or social media accounts contain promotional material accessible to UK clients. In most cases, a UK-registered entity or an FCA-authorized firm must approve the promotion.
Common Compliance Challenges
Even when firms understand the basic concept of reverse solicitation, applying it in practice is rarely straightforward. Regulators in the US, EU, and UK look beyond formalities and focus on the substance of how clients were acquired and serviced. This creates a range of challenges for fintech founders and compliance teams trying to balance growth with regulatory obligations.
The “Paper Trail” Myth
Many firms believe that as long as they collect signed client declarations or include disclaimers in onboarding forms, they are protected. Regulators consistently take the opposite view. What matters is the factual context, not the paperwork.
For example, a letter from a client stating that they acted on their own initiative holds little value if the firm was also running ads in that client’s jurisdiction. Similarly, a checkbox on a sign-up form does not override evidence of targeted outreach, such as local-language content or region-specific promotions.
Documentation is necessary, but it cannot substitute for substance. Regulators want to see that the client’s request was genuinely unsolicited. If marketing or distribution activity exists in parallel, the paper trail will not prevent enforcement.
Indirect Marketing Risks (SEO, Ads, Events)
One of the most common mistakes firms make is underestimating how regulators define “solicitation.” As the definition of solicitation is not limited to direct sales calls or targeted emails, indirect activity can be enough to disqualify reverse solicitation.
Examples include:
Search engine optimization that captures local traffic in a restricted jurisdiction
Running online ads that are visible to users in regions where the firm is not licensed
Hosting or sponsoring events where potential clients are present, even if the invitations were broad
Publishing content in a local language or using a country-specific domain name
For fintechs, this is especially risky because most growth strategies depend on digital channels. Regulators often view online presence and marketing as evidence of targeting, even if the firm claims it was not intentional. A platform may see inbound sign-ups as unsolicited, but if its branding or campaigns were reaching into that jurisdiction, regulators are unlikely to agree.
Scope Creep and Unsolicited Requests
Another frequent pitfall is “scope creep.” When a firm begins with a genuinely unsolicited client request, but gradually expands the relationship beyond that initial service. Regulators see this as solicitation, even if the first interaction qualified as reverse solicitation.
For example:
A client contacts a broker to execute one trade, and the firm later offers portfolio management
An investor reaches out to a crypto exchange to buy a single asset, and the platform then promotes staking, lending, or other services
A retail client signs up for one digital banking feature, and the firm follows up with targeted emails about credit products
Each of these cases shifts the relationship from responding to a request into marketing or cross-selling. Once that line is crossed, reverse solicitation no longer applies.
This highlights the need for internal guardrails. Firms must train their teams to limit their engagement to the specific service requested. Compliance functions should monitor interactions to ensure firms do not introduce new products under the guise of unsolicited business.
InnReg’s compliance consulting services help design regulatory strategies that align with growth goals while mitigating risk →
Timing Issues Under CBDF Rules
The Cross-Border Distribution of Funds (CBDF) Directive and Regulation introduced new timing rules that affect how firms can rely on reverse solicitation. A key issue is what happens after “pre-marketing.” If a fund manager has engaged in pre-marketing activity, any subscription by the same investor within 18 months is presumed to result from solicitation, not reverse solicitation.
This creates a challenge for firms that interact with investors over a longer cycle. An investor may appear to act independently months later, but regulators will link the investment back to the earlier outreach. The burden falls on the firm to show that no pre-marketing took place, which can be difficult in practice.
This means that once pre-marketing occurs, reverse solicitation is effectively off the table for that investor. Compliance teams need clear records of when and how the firm contacted investors to avoid later disputes about timing.
Jurisdictional Inconsistencies
One of the most challenging aspects of relying on reverse solicitation is the lack of uniformity across jurisdictions, which creates operational risk for firms serving multiple markets.
A firm may structure its onboarding process to satisfy EU requirements under MiFID II, but find that the same approach fails in the US, where reverse solicitation is not a recognized exemption. Similarly, practices tolerated in some EU member states may trigger enforcement in others.
This inconsistency means compliance strategies must be tailored country by country. Attempting to apply a single global policy often leaves gaps that regulators can exploit. In practice, firms need localized controls, legal opinions, and a willingness to adjust processes for each major market.
Practical Steps if You Plan to Rely on Reverse Solicitation
Reverse solicitation is best treated as a fallback option rather than a primary market entry strategy. When firms do rely on it, regulators expect to see discipline, structure, and restraint.
Key takeaways when relying on reverse solicitation:
Set Internal Processes and Documentation Standards: Capture timestamped records of client-initiated requests, maintain logs showing no prior outreach, and store copies of client attestations. Compliance teams should review these records regularly.
Control Marketing Reach: Limit the visibility of promotional content in jurisdictions where the firm is not licensed. That may involve geo-blocking, restricting paid ads, and avoiding local-language or country-specific materials.
Restrict Engagement to the Requested Service: Train teams not to introduce new products or services beyond what the client asked for. Cross-selling or ongoing outreach turns an unsolicited request into a solicitation.
Evaluate Alternatives to Reverse Solicitation: Where possible, explore structured routes such as licensing, partnerships with local firms, or recognized cross-border frameworks. These approaches provide stability and reduce the risk of regulatory disputes.
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Firms often misunderstand reverse solicitation as a shortcut for cross-border growth. In reality, regulators treat it as a narrow exception, not a substitute for licensing. Documentation helps, but it cannot override facts that suggest solicitation.
Fintech founders, compliance officers, and legal teams should treat reverse solicitation as a fallback, not a strategy.
Build controls to document unsolicited requests, limit marketing reach, and restrict services to the client's requested services. Where growth extends beyond isolated cases, structured solutions such as licensing, local partnerships, or recognized cross-border frameworks provide far greater stability.
How Can InnReg Help?
InnReg is a global regulatory compliance and operations consulting team serving financial services companies since 2013.
We are especially effective at launching and scaling fintechs with innovative compliance strategies and delivering cost-effective managed services, assisted by proprietary regtech solutions.
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Published on Sep 17, 2025
Last updated on Sep 17, 2025
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