The Financial Services Authority (FSA) has suggested it will not read across its proposed ban on platform rebates to life companies, but has promised to explore the issue further.
The regulator today confirmed its intention to ban both fund manager rebates to platforms and cash rebates to consumers.
But it stopped short of saying it would apply the ban, if it is finalised, to non-platform services including SIPP operators, life companies offering life wrappers, discretionary fund managers and execution-only brokers.
Many had expected it would read across the rules to non-platform sectors, arguing not doing so could create market distortion.
The watchdog said the platform market is different to the life market because the former offers "additional" services, in a consultation paper out today.
It added reading across platform rules to life companies and other non-platform sectors would have only a "limited impact".
However, the FSA said it does understand stakeholder concerns about how rebates operate in the non-platform market, adding it at least "sees the logic" in applying the proposed rebate ban across the board.
"We have seen the product charges for certain personal pension schemes such as SIPPs also described as ‘free' to consumers, when in reality they have been funded by rebates from product providers," the FSA said.
It added it will seek views from the industry about extending the rebate ban to all firms providing a similar service to platforms.
"It is worth noting that we are not consulting on any changes to non-platform markets at this time as the research did not support taking this action," it said today.
"However, the research was primarily focused on the platform market and we do think this is a topic that needs further discussion."
Fidelity Worldwide Investment head of business development Ed Dymott said broadening RDR rules to other parts of the market is a "sensible" step.
"But we are concerned that this addresses just a fraction of the current market," he said. "We will fully engage in the consultation process to ensure the FSA objectives can be effectively achieved."
Two global vehicles
'Further plug advice gap'
Must appoint separate CEOs and boards
Advisers do come out well
Will report to Mark Till