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Fund groups fear being caught by FCA platform definition

Tisa is seeking clarification from the FCA over its platform definition after fund groups offering two or more fund ranges under a single Isa wrapper appeared to be defined as a platform according to the latest rules.

The FCA defines a platform service as one which: a) involves arranging and safeguarding and administering assets investments; and b) distributes retail investment products which are offered to retail clients by more than one product provider but is neither c) solely paid for by adviser charges; nor d) ancillary to the activity of managing investments for the retail client.

The current wording would include fund houses who have made acquisitions and run funds administered by different authorised corporate directors.

If the fund group was defined as a platform it would mean adhering to different capital adequacy rules, and would place restrictions on how money was transferred between the business due to the ban on payments between fund managers and platforms.

Tisa wrap and platform policy council chair David Moffat says: “I do not believe it was ever the FCA’s intent to sweep fund managers offering two or more fund ranges under a single Isa umbrella into the FCA’s definition of a platform. Hopefully the FCA can find an easy way to clarify the rules.”


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