However, looking at the existing RDR roadmap, a few instruments other than vanilla shares and bonds, non-structured Ucits and some structured deposits are likely to be classed as non-complex. The implication here is that for a lot of products, execution-only is not going to be an option any longer because direct-offer financial promotion could struggle to comply with these requirements.
Another area where MiFID II takes precedence over RDR is that of inducements. The European rule bans the receipt of all benefits except minor non-monetary benefits.
Finally, MiFID II also requires firms to disclose all costs and charges related to a product at the point of sale and aggregate the information to show the cumulative effect of costs on the return on investment. Hopefully, information and rules on the key information document due to be introduced by the packaged retail and insurance-based investment products (Priips) regulation in the summer of 2016 will clarify this point.
David Dalton-Brown is director general of Tisa
