View more on these topics

Euro battle over RDR commission ban

The European parliament wants to scrap a Mifid II proposal to ban commission for independent financial advisers across the European Union.

European Commission proposals for Mifid II, published in October, would ban commission for advisers operating on an independent basis.

In response to the commission’s plan, published last month, the parliament proposed an amendment requiring advisers to simply disclose any commission to clients.

Cicero Consulting Brussels analyst Tim Gieles says if the parliament’s amendment is accepted, the FSA will need a carve-out to ensure RDR regulations banning commission could continue. He says: “The FSA got a carve-out on the first Mifid and would need a similar one for Mifid II.”

The FSA is confident it will have discretion to continue the commission ban, whatever the outcome of the directive.

A spokesman says: “While Mifid is often described as a ’maximum harmonisation’ directive, it is a directive and not regulation, which means individual countries still have to write their own rules to implement it.

The parliament’s response also puts forward an amendment to remove the obligation for advisers to disclose whether their investment advice is independent.

German MEP Markus Ferber, acting as rapporteur, says advisers should instead “clarify the basis of the advice they provide, notably the range of products they consider in providing personal recommendations to clients, whether the investment advice is provided in conjunction with the acceptance or receipt of third-party inducements”.

EA Financial Solutions managing director Minesh Patel says: “The UK tried disclosure and it was not enough. The RDR commission ban is needed to rebuild trust in our industry.”


A steady season

Advisers are hoping for a strong finish to the Isa season despite a quiet start to the year. This year’s Isa season is proving hard to predict as markets are static amid concerns that some of the major problems in Europe will reappear. Recent statistics from the Investment Management Association have failed to lift the […]

Coventry BS launches 3.99% five-year fixed up to 65% LTV

Coventry Building Society has launched a new range of five-year products including a fixed rate at 3.99 per cent. The range is available from tomorrow and includes fixed rate, tracker, offset and buy-to-let options. The 3.99 per cent five-year fixed rate is available up to 65 per cent loan-to-value and for a £199 booking fee […]


FSA unauthorised business probe leads to one arrest

A man has been arrested as part of an FSA investigation into a suspected unauthorised foreign exchange trading scheme. With the City of London Police, the FSA executed a search warrant today at an address in East London. A 23-year old man was arrested on suspicion of committing offences under the Financial Services and Markets […]

Leeds is latest to slash interest-only LTV to 50%

Leeds Building Society is the latest lender to restrict its interest-only products, cutting its maximum loan-to-value ratio from 75 per cent to 50 per cent. The change, as revealed by, came into effect last week. In February, the building society cut its maximum LTV for interest-only loans from 70 per cent to 50 per […]

Graphic content – December; the countries most exposed to a rise in protectionism

President-elect Trump has suggested withdrawing from the North American Free Trade Agreement (NAFTA) and ending negotiations over the Trans-Pacific Partnership (TPP), albeit there is considerable uncertainty over what he will, or even can, do. If one of the main consequences of the election of Donald Trump is US protectionism, it’s worth considering who stands to […]


News and expert analysis straight to your inbox

Sign up


There are 4 comments at the moment, we would love to hear your opinion too.

  1. EA Financial Solutions managing director Minesh Patel says: “The UK tried disclosure and it was not enough. The RDR commission ban is needed to rebuild trust in our industry.”
    The thing is, there is trust in our industry. People trust their IFAs NOT the banks. However, the RDR is aimed squarely at the trusted sector and is letting the proven untrusted banking sector off Scott free. Even the EU have decided that commission is not the culprit and the FSA is about to ruin financial planning for the general public in a big way. History will show that RDR will be a disaster. Everyone knows it now and this giant mistake will cost the UK billions again and perhaps the effect of the recent financial collapse will only be the tip if the iceberg! BE WARNED UK!

  2. Dear Minish Patel – I don’t agree. What was the objective behind commission disclosure ? What didn’t it achieve.

    It is the banks that are not trusted. Any mistrust of IFAs has largely and deliberately been generated by a self-interested, arrogant and, I would suggest, pretty incompetent regulatory system.

    If the public realised just how much the FSA, FSCS, ICO, a host of other quangos, and the tens-of-thousands of people in various compliance functions, all purporting to protect them, actually costs each and every investor, they would be shocked and annoyed.

    Has anyone carried out a proper cost-benefit analysis to determine whether this ever-expanding ‘monster’ should be killed off before it completely decimates the UK financial services sector.

  3. So the European parliament is suggesting the commission disclosure regime that we have had for years.
    Herr Ferber suggests that advisers should “clarify the basis of the advice they provide…etc., etc., again, something that we have been doing for years.
    Sorry, Minesh, but “The RDR commission ban is needed to rebuild trust in our industry.” just doesn’t cut the mustard. What has destroyed trust in this industry more than anything is attempts by FIMBRA, PIA & FSA over the last 20-odd years to restructure the industry, and failing every time to add consumer confidence: rather, it has ALWAYS had the opposite effect of leavng the public, the Press and Government more confused about this industry than it was before.
    The one successful outcome of all these attempts has been TO INCREASE COSTS & CHARGES TO THE CONSUMER.

    And now we have RDR.

    God help you all.

    Roll on retirement.

  4. A bit late, methinks. I was going to say that they’ve seen commonsense but given the gender directive that would be a stretch.

Leave a comment


Why register with Money Marketing ?

Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

News & analysis delivered directly to your inbox
Register today to receive our range of news alerts including daily and weekly briefings

Money Marketing Events
Be the first to hear about our industry leading conferences, awards, roundtables and more.

Research and insight
Take part in and see the results of Money Marketing's flagship investigations into industry trends.

Have your say
Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

Register now

Having problems?

Contact us on +44 (0)20 7292 3712

Lines are open Monday to Friday 9:00am -5.00pm