The Financial Services Authority (FSA) has confirmed the presence of trainees within an advice firm will not prevent it from holding itself out as independent.
Concerns over the new definition of independence, which will come into effect after the retail distribution review (RDR), had been raised by some advisers.
An FSA consultation on independent and restricted advice, published in February, states that all the personal recommendations made by a firm must meet the standards of independent advice in order for the firm to hold itself out as fully independent.
If the firm offers both restricted and independent advice, it must make this clear to consumers and not hold itself out as independent, the FSA said.
However, Phil Young, managing director of Threesixty Services, raised questions over how the presence of trainees within a firm would be judged by the FSA.
Trainees may have the relevant qualifications to advise on all product areas, but may not have yet completed enough hours to be signed off as competent by the firm, Young said.
Similarly, trainees may begin working within a firm before they have completed all of their exam modules, and so could only be qualified to advise on certain areas, making them, in theory, restricted advisers, he added.
Young called on the FSA to clarify whether the definition of an independent firm would apply in this instance.
However, an FSA spokesperson said the presence of a qualified supervisor would prevent this from being a problem for fully independent firms.
An FSA spokesperson said: "Trainees work under supervision of an adviser. Their presence would not affect the status of the firm."
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