The Channel island plans to bring in the new rules by January 1 2014, a year after the Retail Distribution Review comes into force in the UK.
Chris Jordan, senior manager in the investment business division of Jersey’s financial regulator, the Financial Services Commission, announced the development at a local meeting of the Chartered Institute for Securities and Investment (CISI) last night.
It is believed Jersey’s rules will be more or less a replica of those of the UK.
One of the drivers for adopting such a regime is to ensure there is no opportunity for regulatory arbitrage between the UK and Jersey in order to protect the island’s status and reputation as a jurisdiction that follows global best practice in financial regulation.
The change means finance professionals offering investment advice will potentially have to gain new, higher, levels of qualifications, while there will also be a huge change in the way fees and commissions are paid.
It is not known if Guernsey is considering a similar move.
If it does not, however, some in Jersey’s financial sector believe its smaller neighbour could itself benefit from regulatory arbitrage as companies seek to put business through a less rigorously regulated – and cheaper – business environment.
