View more on these topics

OFT to probe anti-competitive effect

The Office of Fair Trading is to review the effects of depolarisation because it is concerned that the new rules could have an anti-competitive effect on the market.

This is despite the fact that it ruled against polarisation in the first place.

In its response to the FSA’s consultation on depolarisation, the OFT says the rules could have an anti-competitive effect where firms use the market average to co-ordinate pricing or commission. Aifa and the LIA say there is a danger that the market average could be seen as the norm, forcing IFAs to cut income.

The OFT says it will be reviewing the rules to ensure that they do not grant exemption from the Competition Act 1998. Aifa says it will be gathering evidence to see if such an effect does emerge.

But the FSA does not believe its rules encourage anti-competitive behaviour, saying the menu and market average combat the risk that competition might be based on securing distribution through higher commission rather than value to consumers.

LIA head of public affairs John Ellis says: “I think it is anti-competitive – the trouble with publishing a market average is that it can easily be seen as a norm.”

Aifa director general Paul Smee says: “Aifa has consistently warned the FSA that the market average could have an anti-competitive effect and we are not surprised at the OFT’s comments. We will be collecting evidence of any such effect.”

FSA director of retail policy Dan Waters says: “The OFT has its own view and I can see where they are coming from but we do not expect this to happen. We will be monitoring the situation.”


German bank West LB innovates with index basket

Performance seeker is a capital protected bond designed by German bank West LB and administered by Keydata Investment Services. It is linked to the performance of a weighted portfolio of three stockmarket indices – the FTSE 100, S&P 500 and Nikkei 225 over a six-year term.

Friends aims for £380m securitisation

Friends Provident is looking to raise £380m to fund new business acquisition by securitising a book of life insurance policies. The move also reflects recognition of improvements in annuitant longevity in statutory valuation requirements of its business which could reduce statutory net assets by £30m.

To be and not to be – Multi asset investing with conviction

At Pictet Asset Management we believe active management of asset allocation is the most important generator of returns. What is not to be in our portfolio is just as important as what is to be because good performance is determined as much by the assets you avoid as by those you hold. The FP Pictet Multi Asset Portfolio managers are not wedded to any particular […]


News and expert analysis straight to your inbox

Sign up


    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