UK

FSA Reports Back to UK Fund Management and Brokerage Industries on the Future of Soft Commission

Joanna Gray, University of Newcastle upon Tyne

Background: The FSA’s 2003 Consultation on Bundled Brokerage and Soft Commission

Last month saw the publication in the UK by the FSA of Policy Statement 04/13 that provides feedback on responses received to the FSA’s earlier consultation paper CP176 (April 2003) entitled “Bundled Brokerage and Soft Commission” . That paper had presented analysis of the perceived lack of transparency and conflicts of interest that arise from the use of what are known in the industry as ‘bundled’ or ‘softed’ commission arrangements by fund managers to pay for goods and services from brokers other than execution.