The regulator has published guidance on personal recommendations which bring into effect its proposals put forward last year.
The regulator published the guidance despite facing calls for it to provide advisers with more help on how it will assess this issue.
Among the requests was that the FCA alters its approach to become less conservative, particularly with regards to implicit recommendations.
But in response the FCA said: "The regulatory perimeter is set by Parliament in legislation. The FCA cannot change the perimeter.
"Where we give perimeter guidance, we are setting out what the courts have already said about the legislation and our views about how the courts may interpret it in the future.
"Where a reasonable observer would view the adviser as presenting a recommendation as suitable for the customer or based on a consideration of their circumstances, then this must be treated as a personal recommendation. We cannot exercise discretion on this."
The FCA added that even if wasn't bound by law on this, it believes these cases should be treated as personal recommendations anyway.
The FCA also faced calls for more illustrative examples to help people navigate their way around the rules on personal recommendations.
But in response the FCA said: "To decide whether advice has been given, the individual facts of each case must be carefully examined.
"To be accurate, our guidance must reflect this. We recognise this means that our examples are illustrative and case-specific.
"They cannot and do not provide a clear line between what is and is not advice in all circumstances but should be helpful to firms in making judgments about whether they are providing a personal recommendation in the context of particular circumstances.
"It is not possible to provide an exhaustive series of examples that would apply to every possible circumstance that a firm might encounter."
Having said that, the FCA did agree to provide more examples on certain areas, including on how firms can support execution-only clients who might not have considered all relevant options, how firms can present product options in a way that links them to general investment objectives, and how firms can help customers determine their pension contribution rates.
The FCA also confirmed that these principles apply to all advice, regardless of whether it is delivered in person, online or over the phone.
But it warned that delivering advice in a one-to-one format, whether in person or over the phone, could be more likely to lead to a customer thinking they are getting a personal recommendation because of the personal nature of the interaction and because the conversation cannot be controlled as tightly as it can be online.
The guidance on personal recommendations has been published following the Financial Advice Market Review, which found that some firms are deterred from providing services that help customers make their own investment decisions, at least in part because of uncertainty about whether such services might be a personal recommendation.
The Financial Advice Market Review recommended the FCA should consult on new guidance on what constitutes a personal recommendation.
damian.fantato@ft.com
