Bringing you live news and features since 2006 

Question marks

TISA responds to FCA’s discussion paper on the implementation of MiFID II


TISA, the not-for-profit membership association, warns that many asset managers, distributors, wealth managers, life and pensions companies and firms for whom D2C is important are unaware of the implications of the MiFID II Directive.

TISA, which is unique in the fact that it covers the entire financial industry, incorporating cross-sector policy, industry and technical expertise alongside consultation with government, regulators and the wider industry, believes that there are particular risks posed by the Directive, particularly around complex products, appropriateness, suitability and product governance.
Jeffrey Mushens, TISA’s Technical Director, says: “TISA supports consistency of regulation throughout the retail investment market.  However, our chief concern is that the practical implementation of MiFID II could result in unintended consequences by reducing the options for the consumer in the range of investment choice and also in the type of provider. It could also impact the implementation of new technology by limiting the number of investments available to the consumer to purchase without advice. This would mean that those who do not want to pay for advice would be particularly affected.

“For the industry, any increase in suitability and appropriateness tests will inevitably lead to higher costs and risk for firms, further adding to their regulatory burden.

“Therefore, we believe it is critical that the Directive does not extend the scope of complexity to include, for example, peer-to-peer loans or default funds for personal and occupational DC pensions or UK listed investment trusts.

“We would like to see more details of the specifics of what product governance the Directive envisages and encourage the FCA to revisit its obligations to firms in respect of appropriateness tests.

“Finally, we support the adoption of the proposed standards for independence but have serious concerns about the requirements for telephone records to be kept for five years. Not only is this impractical but it is also expensive, onerous and of little or no direct benefit to customers.

“We believe serious consideration should be given to our recommendations, which place the best interests of both the nation and consumers at the forefront.”

Latest News

Morningstar has published a review of the European ETF market for the first quarter 2024, which finds that it gathered..
ETF data consultant ETFGI reports that assets invested in the global ETF industry reached a new record of USD12.71 trillion..
Calastone has published an ETF white paper which examines several of the processes that take place across the lifecycle of..
Adapting product lines to fit into changing methodologies and meet shifting demand is essential to remaining relevant in the industry..

Related Articles

US ETF issuers of active ETFs are facing an increase in fees from the big custodian firms, such as Charles...
Taylor Krystkowiak, Themes ETFs
Themes ETFs opened its doors in December 2023, with an introductory suite of 11 ETFs – seven thematic and four...
Konrad Sippel, Solactive
At the end of March, financial index specialist, Solactive, published its 2024 annual report on future trends.  ...
Lorraine Sereyjol-Garros, BNP Paribas
Following changes to the French Monetary and Financial Code and of the French market authority AMF’s General Regulation, it is...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by