The result of last week's Brexit referendum took many by
surprise but it was always going to be a close race, with a poll
conducted by the Personal Finance Society in the lead up to the
vote revealing that member opinion was evenly split.
The immediate response from currency and financial markets has
been volatile, but this will ease as traders and investors come to
terms with last week's decision. But as negotiations regarding the
terms and conditions of the UK's withdrawal from the European Union
continue, a degree of uncertainty is likely to linger for some time
yet. For professional advisers, this means an increased level of
demand from consumers worried about the impact of a future deal on
their personal financial circumstances and it has been apparent
that many firms have been kept extra busy since the vote was
For anyone expecting radical change to the country's regulatory
landscape in the wake of last week's decision however, this is
unlikely to materialise. The UK has driven its own regulatory
agenda for years and has always had the opportunity to apply for
variations to EU rules where it feels appropriate.
The unpredictable or adverse impact however, which may include a
restriction on UK advisers being able to operate cross-border, is
likely to become clear quite quickly as the EU looks to push the
Firms covered by MiFID are authorised and regulated in their
'home state' - broadly, the country in which they have their
registered office. Once a firm has been authorised, it is able to
use the MiFID passport to provide services to clients in other EU
As a result of Brexit, some UK advisers who provide cross-border
advice may have little option but to apply for individual
authorisation in different EU states or become a member of an
organisation with its registered office in an EU member state such
Meanwhile, implementation of MiFID II is due by January 2018 -
prior to a formal exit from the EU - and the UK's adoption of this
wide-ranging legislation will be largely unaffected.
On Thursday, the Personal Finance Society will host a meeting of
the board of the European Financial Planning Association, of which
the PFS is an affiliate member. I'm sure Brexit will be a hot topic
for discussion as we continue to seek ways to maximise cross-border
opportunities for professional advisers in the UK.
FSCS funding: risk-based levies in focus
Earlier this week I attended the second formal FAMR consultation
meeting, regarding the regulator's review of the FSCS funding
model. Debate was focused on the possibility of introducing
risk-based discounts for adviser firms that exhibit a relatively
low risk profile.
The discussions were encouraging but there is still a long way
to go before a final decision is made on the best option to replace
the current system of funding the FSCS.
Feedback from members so far has stressed that the most
important aspect of funding reform is to remove the
unpredictability of additional levies being charged on an ad-hoc
Last summer's revelation that some advisers had seen the levy
jump by up to 400 per cent was due in large part to the flaws in
the current system.
I will keep you updated on my ongoing discussions with the FCA
on this important area of reform, and welcome your further feedback
and ideas on how to introduce a fairer funding model - please
direct any constructive feedback to: email@example.com
About the Blog
In this blog Personal Finance Society CEO Keith Richards will be
keeping you up-to-date with all the Personal Finance Society news,
projects and initiatives that we have in the works.
Read past editions of the blog »