European regulation holding back cross-border advice opportunities for UK firms
06 October 2014
New figures from the Association of Professional Financial Advisers (APFA) reveal that as many as one in three advisers have clients who either live or spend time overseas.
The research, carried out for APFA by NMG Consulting, focused on the extent to which advisers deal with clients based elsewhere in the EU. One in three advisers (33%) said that they have clients who either reside permanently in another European state or who split their time between homes in the UK and elsewhere in the EU. Of those advisers, 83% said they only give advice to those clients when they are present in the UK, hinting at a reluctance to secure the clearance needed to advise them when abroad. Only 25% said they hold the regulatory passports required to deliver cross-border advice.
Chris Hannant, Director General at APFA, commented:
“One third of advisers with clients who spend time outside the country is a significant proportion. But because most advisers are exempt from offering Mifid advice, whose requirements really have larger firms in mind, obtaining the passport permission adds an extra regulatory hurdle for UK firms. Therefore, they are only advising these clients when they are on UK soil.
“What becomes clear from our research is the need for a proportionate response in considering the detail of implementing MiFID II, if it is to allow genuine cross border trade for small firms.”
Any advisers unsure of their position or who have questions regarding the application process for either passport can get in touch with APFA for more information.
ENDS
