View more on these topics

Tenet warns on cost of Mifid II to networks

Mike O'Brien 2

Tenet is concerned networks may face high regulatory fees to pay for Mifid II if new levies treat them as one business rather than many.

In a consultation paper released last month the FCA said it planned to recover its costs of implementing Mifid II in 2018 by introducing a levy on the relevant firms’ fee blocks from next year.

After Mifid II has been in operation for a year the regulator will update the levies for fee-blocks where fewer firms are found to have benefited directly from Mifid II.

The consultation proposes small firms in the advice fee-block – those that have income of less than £100,000 – will continue to pay the FCA’s standard minimum fee without paying extra contributions towards cost recovery.

Tenet regulatory director Mike O’Brien says the changes are worrying for Tenet and other networks if their fee is calculated for the network as a whole rather than a collection of small companies.

He says: “Although we are a network and we have got more than £11m in turnover, we are actually a collection of small companies. We do have firms that earn over £100,000 and firms that earn less than £100,000. What we are concerned about is that they treat the network as being one company and therefore we get a huge levy passed on to us which distorts the market if you are not doing the same for directly authorised firms.”

Recommended

Invest-Performance-Portfolio-Fixed-Income-Graph-700x450.jpg

Mifid research rules could hit asset manager profits 29%

European asset managers’ operating profits could decline 17 to 29 per cent because of research unbundling required under Mifid II, analysis by S&P Global has found. Crisil, an S&P company, believes most large European asset managers will absorb research costs, rather than adopting research payment accounts, which it describes as a “strenuous” process. The cost of […]

10

The FCA is listening: Advisers challenge Mifid II plans to record client calls

The advice sector is pushing back against the FCA’s plans to require advisers to record telephone calls amid cost concerns and fears clients could withhold information. In a Mifid II consultation paper published last week, the regulator proposes extending the recording requirement to all “Article 3” firms, which includes advice firms and corporate finance boutiques. The […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. Well, there’s only one authorised firm in a network, so why should they get special treatment?

    Never did see the attraction of being a principal for any appointed reps, and trying to monitor them validated all my concerns.

  2. Totally Agree – very unfair on small network members such as myself as we still have to pay a full share of any levy which is assessed on the network as a whole making these levies higher than they should be for businesses of our size. We also don’t get fee free complaints allowances either unless the network has very few complaints as a whole so because we are not large enough to be confident of dealing with the FCA direct with the add on’s that go with this like Pi cover, compliance monitoring and research we get clobbered disproportionately – one again yet another unfair application from a uncaring regulator.

Leave a comment