The paper comes in the wake of what was known as Jersey’s Review of Financial Advice (RFA), which was conceived after the UK launched its Retail Distribution Review, a package of regulatory reforms governing the way financial advice in the UK is provided and paid for. The RDR took effect in the UK in January.
As reported, both Guernsey and the Isle of Man are also looking into implementing their own versions of RDR. The IoM’s, like Jersey’s, is set to take effect at the beginning of 2014, and focuses on raising the standards of advisers’ qualifications.
Among the JFSC’s final positions:
- A “registered person” – someone who meets certain requirements set down by the JFSC – will not ordinarily be permitted to receive remuneration by way of commission for services provided to Jersey-resident retail clients
- A registered person will need to be able to demonstrate, in writing, that his or her clients have been made aware of all associated fees and charges, including commissions
- There are some exceptions to the new general ban on remuneration by way of commission, including “where adequate disclosure of the commission, or the method of calculating commissions, has been made, in respect of its advice to that client in the circumstances specified [in the position paper]”
- All advisers of retail clients, wherever resident, will be required to hold qualifications equal to QCF [Qualifications and Credit Framework] level 4 or above
- Directors and senior managers who do not meet the definition of an “Investment Employee” will be expected to possess professional qualifications and/or experience appropriate to their role
To read and download the position paper from the JFSC’s website, click here.
