Regulatory experts suggest the FSA still has a fight on its hands to ensure it can ban all advisers from receiving commission despite hints from the European Commission that the RDR rules will be acceptable under Mifid.
Money Marketing revealed in September that a leaked draft of the directive stated independent advisers could not receive commission, with no mention made of other forms of advice. This was confirmed when the draft was published last month.
But last weekend, an official from the European Commission told Financial Times publication Ignites Europe that a commission ban on all UK advisers would be possible. The EC said: “While requirements under the new Mifid will have to be implemented on a national level, member states could be able to cater for additional requirements. The approach adopted by the UK does not seem incompatible with the revised Mifid rules.”
The EC’s position backs up comments made by FSA director of conduct policy Sheila Nicoll last week at the Terrapin Hedge conference, when she said the draft directive does not prohibit regulators from gold-plating the proposals set out in Mifid II.
Lansons public affairs and regulatory consulting director Richard Hobbs says the outcome will depend on whether Mifid II is a maximum harmonisation directive or not. He says: “If this turns out to be a maximum harmonisation directive, it would appear some changes would be needed to the draft text to allow the UK position to continue.”
Law firm Faegre & Benson partner Donald Stewart says: “On Mifid, it is possible that everything is up for discussion, but anybody coming to a hard and fast conclusion at this stage is jumping the gun.”
Mifid II negotiations will now move to the European parliament.