New regulator spearheads change as retail distribution review inches closer

As Ucits IV comes into force and implementation of the retail distribution review (RDR) nears, Fund Strategy thought it would be useful to highlight key dates with regard to three key pieces of regulation.

The summary also covers the alternative investment fund managers (AIFM) directive.

The first important date was last week, with the Committee of European Securities (Cesr) being superseded by the European Securities and Markets Authority (ESMA) as Europe’s primary regulatory body.

Cesr has been the main regulatory body driving the latest Ucits directive, Ucits IV, which aims to simplify the European fund industry, cut costs and encourage cross-border mergers. Ucits IV will become European Union (EU) law on July 1.

The Treasury and Financial Services Authority (FSA) published a joint consultation paper setting out proposals for Ucits IV in December, the deadline for which is March 21. (article continues below)

The European Commission is also consulting on Ucits V, which is expected to deal with depositary liability. The consultation period for this finishes at the end of January, with legislation expected in the summer.

It is not until 2013 that the controversial AIFM directive is set to come into force. At the end of last week a deadline for evidence on its implementation by ESMA passed, marking the beginning of the level two process. A further consultation paper in the summer is expected.

In terms of the RDR, the FSA is expected to issue a statement on its rules about professionalism in January. This will include guidance on any gap filling that IFAs with a level four diploma will need to be RDR-compliant.

In April the FSA is set to publish an updated platform rule following its consultation paper last year, which suggested a more transparent version of bundled pricing will be allowed, although a cash rebate to advisers will be banned.