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For
immediate release: Thursday 8 May 2003
IMA's
RESPONSE TO CONSULTATION PAPER 171
Investment Research: Conflicts of Interest
The Investment Management Association has today released
its response to the FSA’s “CP 171 Investment Research:
Conflicts of Interest”. Despite the FSA’s emphasis on
issues surrounding analysts on the “sell-side”*, the
rules as drafted directly impact upon the in-house research
functions of IMA’s Members as the “buy-side”*.
Furthermore, the IMA has outlined concerns that the
proposals in the consultation paper appear to have been
drawn in isolation from the proposals in CP 176 on bundled
brokerage and soft commission arrangements. IMA therefore
has recommended in its response that the FSA should consider
the proposals on research, unbundling and to some extent
best execution together, as they have a major impact on
market structure and competitiveness in the UK.
Julie Patterson, Director, Regulation and Taxation at the
IMA commented:
“We
believe that the consultation paper identifies key conflicts
of interest in
investment
banks. But we
would be concerned if regulation proved too
onerous
– “sell-side” research is an important part of
information available to
fund
managers and it is important that this flow of information
is not
restricted.
Moreover,
the definition of research and the role of investment
analysts
encompasses
the work done by investment analysts working for
investment
management
firms doing in-house research. This has led to considerable
concern
among our members about disproportionate regulation.”
A
copy of the IMA’s response is attached
-
Ends -
For
further information, please contact:
Julie
Patterson, Director, Regulation and Tax, IMA, 020 7831 0898
Helen
Stephenson, Communications Officer, IMA, 020 7831 0898
Notes to
Editors:
1. The IMA is the trade body representing the UK
asset management industry, representing some £2 trillion
funds under management and over 99% of the UK investment
funds industry (Unit Trusts and OEICs).
2.
*“Sell side” – companies engaged in raising
capital and operating markets (trading).
“Buy side” – users of financial markets who
provide investment services to consumers or make investments
for themselves.
65
Kingsway London WC2B 6TD
Tel:
+44 (0) 20 7831 0898 Fax:+44 (0) 20 7831 9975
www.investmentuk.org
Investment
Management Association is a company limited by guarantee
registered in England and Wales Registered number 4343737.
Registered office as above.
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