Product management director, Credit Suisse
2006 really has been the year of Coll - the new investment rulebook - which is at the forefront of many asset managers' minds. Many have already adopted the regime, while the rest are no doubt working hard towards achieving the new status before the February 2007 deadline. The regime can be implemented in a number of ways - whether it is simply a transition of investments across to the new rules or taking the opportunity to enhance investment powers. Lots of the change is process-driven as making changes under the Ucits regime often results in the need for a shareholder vote - fund-specific or otherwise. For our part, we have made a lot of changes so a number of shareholders have to be written to and there have been some 22 shareholder meetings - so as you can imagine it's been a lot of work. Nevertheless, it's worth the pay-off of taking the opportunity to refresh and update the range, while simplifying it at the same time. This greater efficiency and investment flexibility is great news for investors.
There are three exciting prospects for 2007. First, the industry is developing a wider understanding of what is allowed through Coll and Ucits. We've already seen the growth of absolute return products and 2007 is bound to see an extension of that innovation through a number of multi-asset class mandates.
Second, the FSA is talking about the potential enhancement of funds of unregulated schemes. This will bring different sorts of investments into play, allowing further diversification. Given the clarification of Ucits on a pan-Euro basis, people will have to look at additional fund companies, which will represent an interesting challenge to a number of people. Lastly, November 2007 sees the implementation of MiFID, the Markets in Financial Instruments Directive, the impact of which is ongoing but is expected to affect businesses in a number of ways.
Head of business regulation, Aegon
In regulatory spheres, years often blend together and in many areas, 2007 will be a continuation of 2006. 2006 gave us an insight into the Government's response to Turner's proposals. While the state reforms in the Pensions Bill are broadly welcome, we were disappointed with the downgrading of the State Second Pension, the decision to stop defined contribution contracting out in 2012, the lack of anything new for the self-employed and the continued question mark means-tested benefits casts for many over the attraction of long-term saving. The anticipated pre-Christmas White Paper on personal accounts will give us plenty to debate throughout 2007.
Key issues include personal account design and delivery, the extent to which employers may 'level down' current provision and how we get people saving above the statutory minimum - this takes advice and advice costs. Pensions A-Day's 'simplifications' prompted widespread review of existing arrangements and the wider flexibilities in investments and contributions should benefit pension savers through 2007 and beyond. The FSA maintained its welcome focus on Treating Customers Fairly during 2006 and has set a March 2007 deadline for firms to demonstrate real progress. Providers signed up to the ABI's Customer Impact scheme will be producing their first customer commitment progress reports in the spring.
The FSA also unveiled its approach to transposing MiFID into UK regulation including the opportunity to move from Conduct of Business rules to principles. This will have major long-term implications, which we'll begin to see in 2007. Last but not least, the FSA set out the scope of its review of retail distribution. This dovetails neatly with ongoing ABI work and provides a real opportunity for distributors and providers to work together to build a future that better serves consumers, distributors and providers alike.
Head of tax and financial planning, Skandia
From a tax-planning perspective, 2006 has been about the decisions made on the IHT planning of trusts in the Budget. Not only did that affect the whole taxation of insurance written in trust, but all investment trusts as well. Whereas there used to be two IHT regimes - a simple and a complicated version - now only the latter remains. The impact on inheritance has been huge as tax thresholds have risen and brought asset values along with them. This rise has been faster than inflation and is dragging more people into these IHT regimes. Looking ahead, as with any substantial change, a significant amount of time is needed for them to blend in and the Association of Risk Insurers is working closely with the Revenue to do exactly that. I chair the Association of British Insurers' Product Tax Planner, which is also trying to tackle the uncertainty to make advisers' lives easier as they go.
Head of UK intermediary distribution
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