The European Parliament is expected to reject a proposed Europe-wide ban on commission payments to independent financial advisers when it votes on the matter next week, a published report says.
According to the Financial Times, the parliament’s Committee on Economic and Monetary Affairs (Econ) “has removed all references” to any ban on commission payments to financial advisers in amendments to the draft of the revised markets in financial instruments directive (Mifid).
The Econ committee is proposing tougher disclosure rather than a Europe-wide ban on commission. Under the proposals individual EU member states would be allowed to ban commission, leaving the Retail Distribution Review (RDR) in the UK in tact.
Swedish MEP and Econ member Olle Schmidt told the newspaper: “A total ban was not supported by the majority [of the Econ].
“If you introduce a ban, as in the UK, you can go too far. It would limit freedom of choice for ordinary investors and those most in need of advice would not be able to afford it. A more balanced approach is needed. There are other ways of safeguarding investor protection.”
Source: MoneyMarketing. Read full article here.