The FCA has published Finalised Guidance 14/4: changing customers to post-RDR unit classes (FG14/4). The FCA has also published a summary of feedback received on its earlier guidance consultation on the same topic.
In FG14/4, the FCA sets out what it expects from firms that are involved in the transfer of investors from pre-RDR unit classes to post-RDR unit classes.
The FCA has found that there is some uncertainty over whether a conversion to a clean unit class should be treated in the same way as a switch involving cancelling the existing units and issuing new units. Questions have also arisen about:
- whether conversions can happen in bulk rather than individually;
- if conversions can happen without the express consent of the client;
- whether advice is needed;
- the role of advisers in the conversion process; and
- whether a new disclosure document (for example a key investor information document (KIID) for a UCITS scheme) needs to be issued to the customer before conversion.
The FCA states that the guidance in FG14/4 answers these questions.
The FCA has also published a webpage that sets out FAQs on moving to clean share classes and highlights some of the key aspects of FG14/4.
View Finalised Guidance 14/4: changing customers to post-RDR unit classes, 6 May 2014
View Summary of feedback received, 6 May 2014
View FCA webpage: Changing customers to post-RDR unit classes, 6 May 2014