EU must address passporting 'urgently' as many expats denied advice

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EU must address passporting 'urgently' as many expats denied advice

FECIF Secretary General Paul Stanfield has called for EU action to help "thousands of consumers across Europe" who cannot easily access their chosen adviser and "are often unable to obtain the necessary expertise that they very much require".

In an editorial issued on 3 June, Stanfield highlighted how Brexit led to the EU passporting facility ceasing for UK firms at the end of last year which has been "somewhat ignored at present" on the EU side.

"Whilst the UK has effectively acknowledged regulatory equivalence for EU entities, the EU has not confirmed the same in the opposite direction - and there is little, if any, sign of that happening in the short term, if at all", he said.

Whilst the UK has effectively acknowledged regulatory equivalence for EU entities, the EU has not confirmed the same in the opposite direction."

"The UK has also ensured continuity of business - through frameworks such as the Temporary Permissions Regime (TPR) and Financial Services Contracts Regime (FSCR) - but, as yet, the EU has not reciprocated in a similar manner. Once again, nothing seems to be on the horizon in this regard."

Stanfield pointed out there are different regimes in various countries across Europe but none of them offer the same, relatively easy, continuation options - and some offer, quite literally, nothing at all.

"The effect: thousands of consumers across Europe who cannot (easily) access their chosen adviser - and, in many cases, are unable to obtain the necessary expertise that they very much require."

It's easy to say that they should simply utilise the services of a "local" adviser but is this going to really work in many cases, he questioned.

"Let's take an example of a retired, British expatriate couple living in southern Spain. They hold a number of UK investment and savings products, have property over there and also in Spain, with beneficiaries in England and the US. They also have investments in an Irish-based life assurance bond.

"How many ‘local advisers' do you think can truly provide the total expertise that they require? Very few I would suggest and certainly nowhere near enough to service the tens of thousands of such people living on the ‘Costas'."

He added that if the situation was reversed the same problem could and probably would occur: "A Spanish couple living in the UK with assets and beneficiaries in their homeland would need expertise that might not (and probably wouldn't) be locally available. But the FCA has brought in the TPR, which can specifically avoid this becoming a problem - or at least provide a possible framework to minimise the issue."

This is not about "patting the FCA on its back" Stanfield said, "Anyone who knows me well will realise that my views of the UK regulator's past actions are varied, at best. The FCA, and the FSA before it, has arguably created as many disasters as successes during the 21st century.

"No, this is about "Treating Clients Fairly". I understand that EU Member States see Brexit as a great opportunity for them, particularly in some countries, to further develop their financial services sectors and take business away from the UK.

"There's no problem in that from my perspective; it's a common-sense strategy. But surely that could still be done without completely ignoring the needs of tens of thousands of people around the EU?"

Standfield concluded: "This could be done - and, in my opinion, should have been done - at ‘EU level'. The ESAs could easily have solved this issue in a similar way to the FCA's approach. Over to you Mr Regulator…"