Retail Distribution Review: 10 months on... and the inducement rules
Following a long consultation and implementation process, the Retail Distribution Review (RDR) came into force on New Year’s Eve 2012. This article looks at the emerging supervisory themes 10 months on.
In CP13/4 Distribution of RIPs: referrals to discretionary investment managers and adviser complaints reporting, the Financial Conduct Authority (FCA) proposed widening the scope of the RDR to capture commission payments to independent financial advisers (IFAs) from discretionary managers for retail client referrals. Currently these payments are only caught when the IFA also provides recommendations on RIPs to the client. The new rules will apply to all retail client referrals by IFAs to discretionary managers, even if the IFA’s relationship with the client consists of non-advisory services such as providing general market research in relation to RIPs or passing on information from the manager. The only activity that would appear to fall outside this scope would be simple client hand-overs where the IFA does not provide the client with any services.
These proposals seem likely to come into effect as they were originally contained in Quarterly Consultation CP 12/27 and only three of 18 respondents disagreed. Advisory firms will need to pause and think about these rules if and when they come into effect, as it is an exception to the general principle that RDR only applies where an adviser is giving a personal recommendation…
If you are registered and logged in to the site, click on the link below to read the rest of the Taylor Wessing briefing. If not, please register or sign in with your details below.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from Taylor Wessing
News from The Lawyer
Briefings from Taylor Wessing
For the tax year from 6 April 2014, the standard lifetime allowance has reduced from £1.5m to £1.25m.
One of the areas highlighted last year by the Regulator was the regulation of workplace DC pension schemes.
Analysis from The Lawyer
As the equity capital markets rocketed back into favour and global M&A saw at least a partial return to form, there have been some rich pickings for The Lawyer’s Corporate Team of the Year award shortlisted firms in 2014.
The city-state is working hard to become a global wealth management hub, and law firms are gearing up for a prosperous new world