Available to FCA-regulated advisers, the new membership will cost £70 a year.
The contract includes support and advice on key regulatory issues advisers may be facing when dealing with clients who are expats who are either expats living in Europe or have assets on the continent, said Feifa, a non-profit trade body.
The organisation can also help advisers deal with issues such as lack of knowledge around non-UK tax regimes, adequate PI cover and risk mitigation.
“With around five million Brits living permanently in other countries across the world, there are a significant number of UK-based advisers with clients who are expats, or have assets abroad,” said Feifa’s chief executive Paul Stanfield.
“Advising these individuals has become increasingly complex for advisers in recent times, not least as knowledge of other tax systems, compliant products and national or even local anomalies can be difficult to obtain and challenging to remain current,” he added.
Stanfield referred to a survey by the Association of Professional Financial Advisers (APFA) in 2014 which found that around a third of its members have expat clients.
More recent studies have found a similar proportion of advisers with clients living in mainland Europe alone, he said, adding that more than 250,000 Brits move overseas each year, particularly to European hotspots such as France, Spain and Portugal.
Europe after Brexit
He predicts that with Brexit likely to increase the complexity of regulation, Feifa can help its members on how best to advise clients.
“Even in Europe where passporting facilities create a relatively comfortable environment in which to provide advice to clients in other European countries, the situation is rarely straightforward.
“Does an adviser need to passport under the IMD or MiFID, or both? Under Freedom of Services or Establishment? And what will this allow him or her to actually advise on, and how? These are all highly important questions,” explained Stanfield.
In addition, Feifa revealed that although it is a pan-European trade body, it often assists advisers with clients further afield.
“Only last week we had an enquiry from a UK adviser with regards to a client that is considering moving to South Africa,” revealed Stanfield.
“Within 24 hours we were able to provide information, guidance and contacts with a number of relevant professional to ensure that the adviser could assist the client appropriately, and, most importantly, the individual could make sensible, well informed financial decisions.”
Another key area for concern is the “knowledge deficit” UK advisers experience on non-UK tax regimes, which Feifa says can often lead them to give clients poor advice.
“We often see advice given by UK advisers to expats that is simply not of a similar standard to the assistance that they provide to their home-based clients,” said Stanfield.
“This is usually very much unintentional and generally occurs because of a lack of acquaintance with taxation implications or the inadvertent use of products or services that are simply not compliant in the individual’s new country of residence.
“Often the adviser is actually unaware of these gaps in their knowledge, which can be even more hazardous for them and their clients.”
Lastly, Feifa is also calling on adviser in the UK with expat clients to consider what kind of professional indemnity (PI) insurance is needed to cover individuals living in other countries.
Stanfield highlights a decision made by the Financial Ombudsman Service (FoS) a few years ago which fined a UK adviser for not telling an expat client about recognised overseas pension schemes (Rops), even though such products are not regulated in the UK.
“Partly because of that reason, his PI insurers would not pay out and he had to settle the claim out of his own pocket. Who wouldn’t want to try and avoid that outcome?” he said.
“It is imperative that advisers are sure about the areas of advice that are covered.”