The PS summarises the feedback FCA received on the proposed changes to Section K of the RMAR and the PSD reporting requirements. FCA has made what it describes as some small amendments to the final rules and guidance. The changes to Section K of the RMAR will take effect from 31 December 2014. The changes to PSD reporting will take effect in two stages: 1 October 2014 (reflecting the policy changes pre-MMR implementation) and 1 January 2015 (reflecting the changes post-MMR implementation).

FSCP reviews its work over the past year and notes particular topics of concern going forward, including consumer credit, competition, mortgage borrowing, non-compliance with RDR rules, pensions, cross=subsidies in personal current accounts, investment costs and effective regulation as the consumer sees it.

FCA has published details of instruments passed at its Board meeting on 5 June 2014. These are: Retail Distribution Review (Complaints Data) Instrument 2013/35 and Client Assets Sourcebook (Amendment No 5) Instrument 2013/36. In addition, it notes that the Conduct Of Business Sourcebook (Use of Dealing Commission) (Amendment No 2) Instrument 2014/29 was approved at a Board meeting on 5 May 2014 and states that Instrument 2014/34 was approved at the June meeting and will be published at a later date. The Instruments will be available to download via the second link.

Further to TR14/06, published in April, FCA has published an assessment tool to enable firms to review their disclosure documents against the key disclosure requirements of the RDR. FCA plans to use this to assess disclosure in the third cycle of its RDR review and encourages firms to use this assessment template to make any required amendments to their client facing documentation prior to this.

FCA has published its final guidance in respect of what it expects from firms that are involved in the transfer of investors from pre-RDR unit classes to post-RDR unit classes, The guidance addresses uncertainty over whether a conversion to a clean unit class should be treated in the same way as a switch involving cancelling the existing units and issuing new units and questions on the conversion process. FCA has also published feedback on the original consultation (second link below).

FCA notes that it has been engaged in the second stage of a thematic review to assess how firms have implemented RDR requirements focusing on whether firms that are describing themselves as independent are acting independently in practice and whether firms are complying with the disclosure requirements. TR 14/15 looks at the first of these issues and a separate report outlining how firms are meeting the disclosure requirements is to be published in April. TR 14/15 shows that most advisory firms describing their service as ‘independent’ appeared to use the description accurately. In response to industry requests for further clarification on the standards required for advice to be ‘independent’, FCA has published examples of good and poor practice within its review. FCA is releasing a video on the issue of independence for financial advisers introduced by Clinton Askew, a financial adviser who sits on SBPP. Together the examples in the review and the video will address a number of topics, including: providing advice on all retail investment products in a relevant market; referrals to other advisers; the use of product panels; the use of platforms; the use of model portfolios, which are a collection of funds with a certain asset allocation typically designed to meet a specific risk profile and referrals to discretionary investment services.

The HN provides information on Instruments passed at the FCA Board on 12 December 2013 (Supervision Manual (Product Sales Data and Mortgage Lending and Administration Return) Instrument 2013/83); on 17 January 2014 (Capital Requirements Directive IV (Reporting Guidance) Instrument 2014/1) and on 30 January 2014 (Senior Management Arrangements, Systems and Controls Sourcebook (AIFM Remuneration Code) Instrument 2014/2; Capital Requirements Directive IV (Handbook Administration) Instrument 2014/3; Training and Competence Sourcebook (Accredited Bodies and Qualifications Amendments No 10) Instrument 2014/4; Retail Distribution Review (Adviser Charging No 7) Instrument 2014/5; Supervision Manual (Listing Authority Review Committee) Instrument 2014.6; Supervision Manual (Suspicious Transaction Reports) (Amendment) Instrument 2014/7; Over-the-Counter Derivatives, Central Counterparties and Trade Repositories (No 2) Instrument 2014/8; Listing Rules and Disclosure and Transparency Rules (Primary Information Providers) Instrument 2014/9 and Fees (Consumer Credit) Instrument 2014/10). Instruments may be downloaded inpidually via the second link.

Further to CP13/4, FCA has published this PS. The final rules prohibit new referral payments by a discretionary investment manager to an adviser when the adviser recommends that a client places additional money with the same discretionary investment manager from whom they receive payments following a pre-RDR referral; prohibits referral payments where an adviser firm does not provide personal recommendations to particular clients, but provides other services to them and provides a minor amendment to the rules requiring complaints against inpidual advisers to be reported FCA (in order to match the policy intention that complaints concerning activities when acting as a retail investment adviser – such as advice on shares and derivatives as well as retail investment products – should also be included). The rules banning new referral payments come into force on 31 December 2014. FCA intends at present that the rules on complaints reporting should come into force in June 2014.

FCA has published Finalised Guidance for financial advisers and product providers on when payments made under service and distribution agreements might create conflicts of interest. Payments should be “based on reasonable reimbursement for the costs incurred” by advisers and “should always enhance the quality of service provided to customers”. The responsibility for managing potential conflicts is to be shared between product providers and advisers.

Chancery Division, Companies Court 16 May 2013 (judgment given extempore) Administrator — Appointment — Formalities — Financial services company — Consent of Financial Conduct Authority required to be obtained for appointment of administrator — Notice of intention to appoint administrators filed prior to consent from Financial conduct Authority — Consent from FCA being filed on day after filing of notice — Whether failure to obtain prior consent invalidating appointment of administrators — Whether administrators being validly appointed — Insolvency Act 1986, Sch B1, paras 22, — Financial Services and Markets Act 2000, s 362A. Section 362 A of the Financial Services and Markets Act 2000 provides: '(1) This section applies in relation to a company or partnership of a kind described in section 362(1)(a) to (c). (2) An administrator of the company or partnership may not be appointed under a provision specified in subsection (2A) without the consent of the appropriate regulator…(3) Consent under subsection (2)(a) must be in writing, and (b) must be filed with the court along with the notice of intention to appoint under paragraph 27 of Schedule B1 to the 1986 Act or paragraph 28 of Schedule B1 to the 1989 Order. (4) In a case where no notice of intention to appoint is required (a) subsection (3)(b) shall not apply, but (b) consent under subsection (2) must accompany the notice of appointment filed under paragraph 29 of [Schedule B1 to the 1986 Act or paragraph 30 of Schedule B1 to the 1989 Order]'. The company concerned in the proceedings was a London based company which acted as an international property investment agent, specialising in luxury resorts in the Caribbean. Around mid-April 2013, the directors of the company, D and C, took insolvency advice and subsequently instructed solicitors to enter the company into administration. Prior to doing so, the solicitors contacted the Financial Conduct Authority (FCA) to enquire whether FCA consent was required, pursuant to s 362A(3)(b) of the Financial Services and Markets Act 2000 (the 2000 Act), as amended, prior to filing the notice of intention to appoint administrators. A representative of the FCA informed the solicitors, via telephone, that consent was not required. Relying on that advice, on the 3 May 2013, the solicitors filed notice of intention to appoint administrators pursuant to para 22 of Sch B1 to the Insolvency Act 1986 (the 1986 Act). The notice of intention was served on the company. The following day, the FCA sent an email to the company's solicitors, informing them that the previous information had been incorrect, that FCA consent was required, and attaching that consent. On the same day, the company's solicitors filed the FCA's consent with the court. Considering that the validity of the appointment of the administrators might be called into question because the FCA consent had not been filed on the same day as the notice of appointment of the administrators, the directors and the administrators of the company (together the applicants) applied to the Companies Court for a declaration that the administrators had been validly appointed. The issue for consideration was whether the administrators had been validly appointed having regard to the fact that the FCA's consent had been filed at court the day after the notice of intention to appoint administrators, rather than on the same date. The applicants submitted that the administrators had been validly appointed for alternative reasons. First, on the true construction of s 362A(3)(b) of the 2000 Act, the words 'must be filed with the court along with the notice of intention to appoint' did not require that consent be filed at court simultaneously with the notice of intention (the first submission). In support of that contention, reliance was placed on Re Ceart Risk (Ceart) [2012] BCLC 645; [2012] All ER (D) 43 (May) (para 19). Alternatively, the applicants submitted that, even if there was a defect, such defect was curable and had been cured when the FCA's consent had been filed (the second submission). The application would be granted. It was settled law that the words 'may not be appointed… without the consent of the Authority' clearly indicated that it was essential to obtain the FSA's consent. They did not clearly indicate that it was essential to do so prior to the appointment. It followed, as concluded in Ceart, that s 362A(2) should not be interpreted to mean that failure to obtain prior consent of the FSA should invalidate the appointment of administrators under para 22 of Sch B1 to the Act. On its true construction, the wording of s 362A did not compel the conclusion that the consent had to be filed at the same time as the notice of intention to appoint or notice of appointment, as the case might be. As the court held in Ceart, a consent filed the following day could still be said to have been filed 'along with' a notice of intention to appoint or to 'accompany' the notice of appointment. Further, Parliament should be taken to have intended that failure to obtain the FSA's prior consent constituted a defect in the appointment which was capable in appropriate circumstances of being cured subsequently. In respect of the first submission, there was no reason to depart from what had been said in Ceart and the court would adhere to the construction of s 362A(3)(b) of the 2000 Act in that case. The construction of s 362A(2) of the 2000 Act in Ceart was also adopted. Accordingly, there was no defect in the appointment of the administrators in the instant case. In short, the FCA's consent had been filed with the court along with the notice of intention to appoint administrators even though it had been filed the day after the notice of intention to appoint. In respect of the second submission, applying settled law, and for the same reason in Ceart, if there was a defect in the appointment of the administrators by virtue of the fact that the FCA consent had been filed the day after the notice of appointment, that defect was curable and had been cured when the FCA's consent was filed the following day. Accordingly, the administrators had been validly appointed on 3 May 2013. A declaration would be granted accordingly. Ceart Risk Services Ltd, Re; Bootes v Ceart Risk Services Ltd [2012] 2 BCLC 645 applied; Hill v Stokes plc [2011] BCC 473 Virtualpurple Professional Services Ltd, Re [2012] 2 BCLC 330 Euromaster Ltd, Re [2012] All ER (D) 84 (Aug) Bezier Acquisitions Ltd, Re [2012] 2 BCLC 322 considered.