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Passporting crackdown on the way

The FSA says it will keep a close eye on firms using passporting rules as an attempt to circumvent the RDR.

Firms in the European Economic Area can passport into any jurisdiction within the EEA as long as they comply with the rules in the state they are based in.

The FSA’s formal response to the Treasury select committee’s RDR report, published this week, accepts the committee’s call for the regulator to ensure passporting is not used to avoid RDR requirements.

It says: “We have processes in place to identify and monitor individual advisers who move to another EEA jurisdiction and passport back to avoid the RDR rules.

“Where we have concerns over individuals’ competency or propriety, we will conduct our own investigations or refer them to the relevant EEA supervisor.”

European regulations such as Prips and the Mifid II directives are being developed which could have an impact on the final shape of the RDR.

The FSA says it will work with the European authorities to ensure compatibility with the RDR. It says: “Where necessary we will seek to influence the EU agenda to ensure UK interests are protected and enhanced.”

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Comments

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  1. And what will the FSA be able to do if a legitimately passporting firm tells the FSA to get lost and put its own house in order?

    It won’t be able to cancel the firm’s authorisation or impose a fine or be able to impose any other sort of sanction. And so what if the FSA grasses up the firm to the other regulator? If the other regulator is satisfied that its own standards are being properly adhered to, it might just tell the FSA to mind its own house and stop sticking its nose into other peoples’ business.

    And, of course, how will the FSA gather any evidence of supposed wrong doing? It won’t have any RMAR or complaints data to go on.

    What a nasty bunch of people they are.

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