The FSA has confirmed its commitment to a principles-based approach for regulating the platform industry.
In its feedback response to the June 2007 Platform Discussion Paper, the regulator says detailed rules “risk stifling innovation” and would likely become out of date quickly in the rapidly developing market.
However, the FSA says it remains concerned about a number of potential platform risks, including increased complexity and costs for consumers following platform adoption and conflicts of interest for advisers.
The regulator is also concerned advisers may not always have the “appropriate competence” to provide investment advice through a platform.
It says it will monitor platform providers and intermediaries to ensure customers are being treated fairly through the existing regulatory approach.
“We believe that our principles-based approach to platforms, favoured by the industry, is appropriate - this gives firms discretion over how they approach platforms, and in a way that treats customers fairly, in line with their own business models,” FSA retail policy and themes director Dan Waters says.
"However, we are anxious that firms place customers at the heart of their operations when using platforms, and we are planning follow-up work with platform providers and intermediaries to ensure that this is the case."IFAonline
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