The FCA has clarified some areas of the Mifid II regulation hitting the UK markets, following a roundtable event with industry trade bodies.
The regulator has cleared up some confusion around the European regulation’s rules on recording client communications, saying advisers will not have to record face-to-face meetings.
Under Mifid II firms are required to record telephone conversations and hold the recordings for at least five years, rather than six months as currently required.
“The FCA said that the taping rules did not require the taping of face-to-face conversations. The requirements on accessibility of the information and monitoring of calls were similar to those the FCA would expect under its existing taping rules,” say the minutes of the roundtable meeting.
“Firms would be expected to respond in a reasonable timeframe to reasonable requests from clients for copies of tapes without a charge,” said the minutes.
The FCA also reaffirmed its position on legacy trail commission.
The Investment Association, and other experts, recently stated that legacy trail would be banned under current Mifid II rules, unless an exception was made by ESMA.
The roundtable minutes reiterate the regulator’s previous statements that it has no plans to ban trail. “The FCA noted it had no plans to change its current rules on trail commission. The sunset clause for platforms is affecting the availability of trail, but the FCA has no plans to alter pre-RDR trail off-platform.”
More clarity on the technical guidance for Mifid II and the UK’s implementation of it will come in the FCA’s consultation paper, due out in December. The FCA will also hold a Mifid II conference in October to discuss the changes with the industry.
Among those present at the event were the AIC, the Wealth Management Association, Tisa, the ABI, and the UK Platforms Group.