MEPs approved a draft of the Markets in Financial Instruments Directive (MiFID) today by an overwhelming majority, lending their backing to wording which allows payments from fund providers to advisers and distributors.
Some 495 out of 529 MEPs voted through the directive, which runs counter to the FSA’s plan to outlaw commission in the UK retail market under the RDR, which comes into force in January 2013.
Instead of a ban, MiFID calls for increased transparency and disclosure of payments, and requires providers to avoid remunerating staff in a way that creates conflicts of interest between them and their clients.
The FSA has previously said it is relaxed over the outcome of the vote, as European rules allow national jurisdictions to go “above and beyond” the minimum standards agreed at the European Directive level. A spokesperson for the UK regulator said: “Europe has been well briefed on this [RDR]. We do not expect any conflict.”
