By Alex Gillespie

On 20 February, the FCA released a discussion paper (DP23/2) on updates and improvements to the UK regime for asset managers. In the paper, the FCA sets out ideas about how to improve asset management regulation with a more modern and tailored regime, better meeting the needs of UK markets and consumers.

The paper includes chapters on:

  • The structure of the asset management regulatory regime – which looks at broad issues around the rules for asset managers and funds and considers areas where the rules could be simplified or restructured. In this chapter there is discussion on (i) the rules for fund managers of different types and portfolio managers, (ii) the regime for retail funds and (iii) the regime for fund managers of professional funds.
  • Improving the way the regime works – which looks at areas where the FCA consider that there may be an opportunity to improve how the regime works. In this chapter there is discussion on, amongst other things, rules which the FCA’s supervisory experience suggests may not always lead to good outcomes and other rules which the FCA believes could be modernised.
  • Technology and innovation – which sets out the FCA’s thinking on the role of technology in supporting better outcomes from authorised funds. It considers areas in which the FCA might amend its fund rules to support technological changes that could modernise fund propositions.
  • Improving investor engagement through technology – which covers how the FCA’s fund rules could be revised in the light of developments in technology to improve investor engagement (particularly retail investors once they have invested in their chosen fund(s)). It discusses the post-sale information that funds managers give investors and the wider market about the fund and its activities, and how retail investors can interact with the fund manager and make their views known.

The FCA asks that views from the industry be received by 22 May 2023. The FCA will then consider the feedback and publish a feedback statement later in 2023, possibly alongside a consultation paper on some of the discussion topics.

For further UK financial services regulatory updates, please visit the Burges Salmon blog.