Advisers do not stand alone when it comes to regulation and Europe. Paul Robertson talks to Steve White, your man in Brussels
I think they’re quite keen to have the different states having their own level. So, Europe sets the minimum level.
“We have a preference to pick up the professionalism piece and run with it, rather than having the regulator impose it on us. So we create that separation rather than the regulator.”
However in this country, the FSA has a habit of picking these things up and running with them, maybe a little quicker than everywhere else in Europe.
White said: “From the supervision point of view, it has an appetite and enthusiasm for supervision pretty well unrecognised anywhere else in Europe.
“In fact, in the dealings I have at BIPAR level in Brussels, more often than not, our European peers thank us for the English Channel because it keeps the FSA on the UK mainland rather than having it spread its zeal.”
Nevertheless, professionalism varies across Europe, creating its own set of problems.
The Germans, according to White, have a very rigorous qualification and CPD requirement.
But in Europe, there is a recognition requirement of examinations across borders.
The problem the Germans have is that the Maltese examination is available after about a fortnight’s worth of study.
So Germany has noted Germans holidaying in Malta and returning with an exam that has to be recognised. The Germans, understandably, have a problem with that.
White added: “However, what we have in the UK is more onerous upon the firm because the firm has got to establish a job description and work out what the key competencies are, so what does the adviser need to have in the way of knowledge and skills to do that job description?
“Then they have to measure it and provide training if they spot a gap to make sure that he does tick those boxes. And then there’s a record keeping requirement to prove that you’ve done it. It’s more onerous than an exam.”
Of course the elephant in the room, one that White spends a large amount of time on, is the Financial Service Compensation Scheme.
Essentially the problem is simple: there are five classes within the compensation scheme funding model, of which insurance is one.
This class is split into insurers and intermediaries. It is the intermediary pot that causes the problem because that pot is the largest by number of firms in it and it’s the most diverse pot by the variety of firms that are in it.
