02 Feb FSA Comes Under Fire for Failing to Clarify Position on Legacy Commission Rules

Providers have criticised the FSA over their handling of legacy commission rules, claiming that the advisor needs to come out with a clearer definition of where they stand on the issue, as currently there are a number of different interpretations of their rules. This has led to providers calling for clarification so that they can properly prepare in advance of the implementation of the retail distribution review. Life companies, fund managers and trade bodies received last November’s Treatment of Legacy Asset consultation paper with the hope that the document would help to provide further clarification about the issue. However it would appear that the document failed to achieve this goal, only serving to further complicate things. Fidelity head of commercial Ed Dymott claims that clarification needs to come as soon as possible, stating "Not only is there a risk that these rules are interpreted inconsistently by the market, but the longer the FSA delays this issue, the more pressure that it places on the industry to meet the deadlines. "The biggest concern is that in every part of the market we’ve already seen many different interpretations of the rules."