Are the FCA and the EU singing from the same hymn sheet?
Asset managers will be hit by a wave of new regulation when MiFID II applies from 3 January 2018, including new requirements on the disclosure of costs and charges. Compounding the complexity, the FCA's interim report on its Asset Management Market Study suggests remedies for the transparency of fund charges which would go further than MiFID.
On 27 March 2017, the Investment Association published a consultation on a new code for enhanced disclosure of charges and transaction costs, which takes account of MiFID II, the PRIIPs Regulation (Regulation 1286/2014) and the FCA's consultation on draft rules for transaction cost disclosure to workplace defined contribution (DC) pension schemes. However, it notes that the final document will need to take into account the ultimate findings of the FCA Asset Management Market Study.
In this article, we consider the FCA's direction of travel on transparency for costs and charges in light of the MiFID II requirements and how we may arrive at a consistent framework.