Mifid II  

FCA publishes new Mifid II rules on tied advisers

FCA publishes new Mifid II rules on tied advisers

The Financial Conduct Authority has set out rule changes from Mifid II affecting tied advisers.

It has published the fourth and final consultation paper into the directive, which comes into effect on 3 January 2018.

Under the new Mifid II rules, changes will be made to the tied advisers regime, which will no longer be optional for member states of the European Union.

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At the moment some member states do not allow investment firms for which they are the home state to appoint tied agents.

The FCA said: “This may lead to a scenario in which a UK Mifid investment firm appoints a tied agent established in another member state but in which that tied agent cannot be registered (because the Member State does not maintain a tied agent regime).

“Such a tied agent must be registered with the FCA.

“Under Mifid II, it will no longer be the case that tied agents established in other member states might need to be registered in the UK for these purposes, because all member states will be required to maintain tied agent regimes.”

It added: "We propose reflecting the technical changes in Mifid II to the tied agents regime in our rules dealing with appointed representatives."

The consultation also said HM Treasury will extend the regulatory perimeter of the tied adviser rules to include certain activities – such as arranging and advising – in relation to structured deposits.

The FCA said UK firms will see limited impact from these rule changes, unless they currently use tied agents in member states which do not have such a regime.

It has also proposed a transitional rule for fees to deal with the period between when the FCA start accepting applications for authorisations related to the changes in Mifid II and the point at which legislation changes to allow it to collect fees for the changes of scope.

The FCA has proposed that the fee payable for the application made under the transitional regime will only be payable where the fee for that application is higher than the amount paid for any connected application for activities it already regulates.

The consultation runs until 16 January 2017.