PERG 12.4 Application of EU Directives

Q24. Do the changes in the scope of regulated activities concerning pension schemes that took effect on 6 April 2007 have any implications for pension scheme trustees or service providers under the Investment Services Directive (or, in future, the Markets in Financial Instruments Directive) or the Insurance Mediation Directive?1

In general terms, if a pension scheme trustee or service provider did1 not need to be authorised under the Investment Services Directive prior to 6 April 2007 he should not need to be authorised for carrying on the same activities after that date. This is because rights under a personal pension scheme are not a financial instrument under the Directive and establishing, operating or winding up a personal pension scheme is not an investment service under the Directive. This will also be the case under the Markets in Financial Instruments Directive when it replaces the Investment Services Directive later in 2007. But this is subject to the fact that investment advice will become an investment service for the first time. Guidance on the application of the Investment Services Directive to the activities of pension scheme trustees and service providers generally is in Chapter 10.4A of PERG. Draft guidance on the changes in regulatory scope that will be caused by the implementation of the Markets in Financial Instruments Directive was issued as Annex 5 to Consultation Paper 06/9 (Organisation systems and controls) and will form Chapter 13 to PERG.

Similarly, a pension scheme trustee or service provider who was1 not subject to regulation under the Insurance Mediation Directive prior to 6 April 2007 will not become subject to regulation purely as result of the changes in regulatory scope that took1 effect on 6 April 2007. Detailed guidance on the application of that Directive to pension scheme trustees and service providers is in Chapters 10.4 and 10.4A of PERG.

1111