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Radical rethink to give public greater choice

Sweeping changes to the polarisation regime will end many restrictions on what business a firm can conduct.

The FSA proposes removing the barriers to choice in draft regulations for the depolarised world, which could become a reality by the end of the year. Multi-ties are created, gap-filling is allowed, the better than best rule is scrapped and white-labelling of products is banned.

The only obligations on IFAs will be that they must give advice on the whole market and offer consumers the choice of paying fees.

Firms and advisers will be allowed to become tied, multi-tied and independent, including within the same firm, as long as the service provided to consumers is made clear in a box-ticking disclosure document.

There are no limits to the number of providers that multi-ties can tie to and distributors can tie to a provider for all or some of its products.

Multi-tied panels will not have to be made up of the best available on the marketplace. There is no obligation for them to be reviewed and they can be changed at any time.

During the sales process, a multi-tied adviser can make a recommendation “out of range” of their ties although this is left to the management&#39s discretion.

Appointed representatives must continue to do business only with providers approved by their single principal but are not prevented from moving principal or becoming directly regulated.

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