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Signature change set to speed re-reg

A significant legislative barrier to the re-registration of mutual funds is set to be removed in draft changes that are about to go before Parliament.

In amendments to rules on unit trusts and open-ended investment companies as part of the electronic communications order and the Financial Services and Markets Act, clients will no longer have to give written confirmation to transfer units or shares and instead can give just electronic approval.

Cofunds managing director of operational services Stephen Mohan says: “I think this is really going to improve the customer experience and it should create efficiencies as we will not have to send signatures to and fro.

“It is not the end game but it may signal the beginning of the end in taking legislation out of the equation. For platform-to-platform re-registration, we still need all the parties working together on the same systems’ issues to create a common standard for messaging.”

Mohan says there needs to be daily asset reconciliation and a common electronic language for transfers to facilitate full platform-to-platform registration.

Financial Technology Research Centre director Ian McKenna says: “This should be the last real barrier to scalable re-registration.”

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