For immediate release: Friday 21 April 2006 

CLARIFICATION FOR COLLECTIVE INVESTMENT SCHEME PRICING

In yesterday’s publication “CP06/07 - Single and dual pricing for authorised collective investment schemes”, the FSA has appropriately addressed the issue of investment fund pricing.

Uncertainty in this area as to whether or not all funds would be required to move to single pricing has caused considerable concern among IMA’s members for some months. This consultation tackles these concerns.

Single and dual-priced funds have co-existed for 10 years without significant detriment or confusion for investors. The FSA is correct in noting that both mechanisms have their advantages, in terms of transparency and fairness to investors. 

With an estimated one-quarter of investment funds still operating on a dual-priced basis, enforcing mandatory single pricing is not the way forward and could cost the industry an estimated £13 million¹. The FSA therefore correctly identifies that there is no reason why the two pricing methods cannot continue to operate simultaneously.

Sheila Nicoll, Deputy Chief Executive of the IMA commented:

“This consultation sees the FSA taking an appropriate, principle-based approach to regulation and in doing so has clarified the position for managers of dual-priced funds. The proposal to allow dual and single pricing models to continue to operate in tandem is therefore welcome and removes uncertainty for the industry.”

-Ends-

Notes to editors:
¹Source – “CP06/07 - Single and dual pricing for authorised collective investment schemes”, Financial Services Authority.

For further information, please contact:
Helen Stephenson, Communications Officer, IMA, 020 7831 0898