21 November 2013
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The Association of Professional Financial Advisers (APFA) is claiming a key victory in the fight for fair regulation of advisers following news that European Union ministers have dropped a proposal to cap fees for advice.
The measure was included in the draft regulation on key information documents for investment products (PRIPS) put to the European Parliament for approval yesterday.
In Article 13 (d) of the draft paper it stated: "When an hourly rate is charged, the total amount charged for providing advice shall not exceed €200."
APFA director general Chris Hannant said: "We have been pressing MEPs hard to have it quashed, and thanks to our efforts it has now been withdrawn.
"Capping the amount advisers can charge amounts to a form of price control. History has shown it doesn't work.
"Regulators must seek to promote competition within financial advice, not fetter it. The best protection for consumers comes through choice and transparency. A price cap would undermine that, as well as being hugely damaging to advisers."
In 2012, the European Commission announced proposals for legislation aimed at providing greater protection for retail investors, including new regulation on Key Information Documents (KIDs) for Packaged Retail Investment Products (PRIPS).
