Euro directive on FSCS funding set for June
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The European directive that will shape the FSA’s review of the Financial Services Compensation Scheme’s funding model is expected to be published by the end of June.
The FSA says it is waiting for the directive from the European Commission, the investor compensation schemes directive, before announcing the scope of its review.
The directive is expected to set out how the EC would like compensation schemes to operate across Europe, including whether they should be pre-funded. The FSA has scheduled the funding review for the third or fourth quarter.
Cicero Consulting director and chief corporate counsel Iain Anderson says: “I am certainly expecting this directive before the European summer, that is, by the end of June. Things can slip but there is a desire to get on with it sooner rather than later.”
In the FSCS industry newsletter, published last week, chairman David Hall said: “It is important the FSA completes a review of our funding arrangements as soon as it is clear whether impending EU legislation on deposit and investment protection is going to provide for a pre-funded approach or allow a continuation of our current pay as you go levies.”
Aifa director Robert Sinclair believes the EU may be leaning towards adopting a pre-funded model, which he says may be costly for firms.
He adds: “Aifa would like to see the directive come out of Europe quickly so the much needed review of the structure of the UK compensation scheme can be started.”
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Readers' comments (1)
Norm d'Plume | 14 Apr 2011 2:19 pm
Why should the EU have ANYTHING to do with how we fund the FSCS? Next thing they'll be telling us that car insurance premiums have to be homogenised across Europe, or some such rubbish.
What nonsense!
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