FSA's bonus rules face legal battle

A provision set to be brought in next January will allow the FSA to void contract if it discovers an employer has breached its remuneration code. Currently, the code applies to the largest banks, building societies and broker dealers. However, the regulator plans to extend this to asset managers, hedge fund managers, UCITS investment firms as well as some firms engaging in corporate finance, venture capital, the provision of financial advice and stockbrokers. These are firms which are now caught by the Capital Requirements Directive (CRD 3). Employees could be forced to give bac...