Regulation  

IMA chief hails impact of 2013 fund reforms

The fund management industry’s top lobbyist has written to chancellor George Osborne praising efforts made since last year’s Budget to bolster the UK’s status as a global asset management hub.

IMA chief executive Daniel Godfrey said the UK Investment Management Strategy – launched in the 2013 Budget by Mr Osborne – had “brought about significant improvements to the competitiveness of UK funds” and had boosted the “attractiveness” of the UK as a home for investment management.

He said the IMA had worked closely with government departments during the past year as a member of both the Asset Management Steering Committee and the Fund Management Campaign team.

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“We are grateful for the government’s significant commitment, and for the energy and urgency shown by your officials, which has already brought about an improvement in the tax rules impacting UK funds and UK managers of funds,” he said.

“[There has also been] the launch of the UK’s authorised contractual scheme (ACS) regime, shortened fund authorisation times and a clearer, but still rigorous, approval process [as well as] a sustainable marketing plan for the UK’s investment management industry and [a] welcoming service for incoming firms.”

Mr Godfrey added that the progress these steps have shown is “outstanding” and “significantly enhances the UK’s competitive position”.

Julie Patterson, the IMA’s director of authorised funds and tax, told Investment Adviser that the trade body has been “proactive” in its position of lobbying for the UK and that it was now “anticipating developments” in regulation rather than reacting to them.

She said the relevant bodies with which the IMA had been working – including government departments and the FCA – had achieved nine changes in just nine months since Mr Osborne announced the UK Investment Strategy last year.

She said: “I knew we would make progress, but to achieve nine things in nine months is fantastic. And these are not small things.”

Ms Patterson said that the changes implemented to improve the attractiveness of the UK as a centre of fund management included the abolition of Schedule 19 stamp duty reserve tax.

This was levied on the managers of UK-domiciled unit trusts and Oeics, but was usually passed on to clients in what Ms Patterson described as a “double whammy” of charges.

She added that the Treasury had also removed the requirement for fund managers to withhold tax on rebates paid to overseas investors; that funds domiciled outside the UK but run by managers here are no longer liable for tax; and that tax-transparent fund structures have been introduced.

Ms Patterson also said the fund authorisation process that had started to “become inefficient” had been “smartened up”, adding that the FCA had committed to “[reducing] the turnaround times of fund authorisation”.

“We had one meeting with the Treasury and the FCA and sorted this out,” she said.

“The application forms have multiplied in size [over time] by a factor of six. This is not about making it a weaker process, though, but making it clear what is needed.