tex - tisa
TRANSCRIPT
30 April 2013
TeX – The answer to Transfer
and re-registration delays?
Industry funded, not for profit association.
Set up to provide governance for re-registration
and electronic transfers
Sets membership fees, guardian of the legal
agreements and TeX Register.
It is a Contract Club
Supported by FCA
What is TeX?
To allow the electronic transfer & re-registration of
funds.
(UK-registered unit trusts and OEICs)
To allow the electronic transfer of ISA wrappers.
Designed for the transfer of clients’ assets when they
move from one platform / nominee / fund manager /
wealth manager to another
Already pressure from Offshore Funds and SIPP
operators to join
TeX Objectives
4
What about the regulators?
We have engaged and shared with the FSA the details of
the TeX contract club and the principles behind it. The FSA
have supported such an industry led solution and confirmed
it will help meet the policy expectations as set out in PS11/9.
The FSA continue to stress that if their policy objectives are
not achieved it may require further rules being introduced to
areas of the marketplace which are not working towards
making re-registration take place in a reasonable time and
efficient manner. The FSA fully support the principle of a
consistent standard across the industry together with clarity
and transparency to the consumer.
FSA 21 December 2012
4
Why? - Regulation
Re-Registration is firmly in the FSA’s sights. The FSA’s Retail Distribution Review, Consultation Paper 10/29 stated in
paragraph 4.11 that: “In line with our proposals in DP10/2, we intend to
introduce a rule to make it compulsory for platforms to allow
assets to be re-registered off their platform no later than the
implementation of the RDR on 31 December 2012”.
FSA Policy Paper “PS11/9 Platforms” August 2011 paragraph 4.7:
“Given the TISA initiative, which we support, we do not think it is
appropriate for us to set prescriptive rules regarding timescales
for re-registration at this stage.
We will use the results of our post-implementation
review work to assess the industry’s progress and to determine
whether prescriptive rules are needed.”
Overcoming the
Contractual Paper Mountain
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There may be 50
nominees
Plus 150
fund managers 1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
A
B
C
D
E
That’s up to
1,225 different
inter-nominee
contracts
... and up to
7,500 different
FM-nominee
contracts
With Tex, the “Contract Club”,you
sign one legal agreement
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Byelaws
Platform
Terms
Fund
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
A
B
C
D
E
Contains standard template clauses on
data protection, dispute resolution,
liability etc
•Clauses around indemnity,
•Agreement to abide by SLA
•Acquiring Platform’s
responsibilities
•Ceding Platform’s
responsibilities
Predominantly indemnities
plus the agreement to abide
by the SLAs
Manager
Terms
One single contract, everyone has the same rules
• The alternative is side letters with every counterparty.,
Strong Corporate governance
• Industry directors, representing fund managers and
platforms (inc wealth managers and wraps) run TeX
• 75% majority for changes. Changes need consent
TISA directors represent industry as a whole.
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Why the Contract Club works
7
The Latest
• 44 Members and 4 Associate Members
• Another 13, plus 5 potential associates currently going
through the joining process and another 28 in
conversation.
• Vast majority of platforms by AUM have joined or
committed (over 90%)
• Over 77% of FUM fund managers have joined or
committed
• Testing by suppliers to ensure system inter-operability
is in progress. It works!
• A logical and fair apportionment of risk and liability
• A simple system which is comprehensible
• Will decrease disputes and uncertainty as to liability
• Will work alongside existing fund manager/platform
agreements
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TeX – Contract Club
Advantages
Are you an authorised firm and do you have the following
permissions?
• Agreeing to carry on a regulated activity
• Arranging (bringing about) deals in investments
• Arranging safeguarding and administration of assets
• Safeguarding and administration of assets (without arranging)
If you carry out this type of business, your liability risks
need to be covered.
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TeX – Who should
join?
• Re-Registration standardises industry process
• Satisfies PS11/9 compliance obligations
• Industry standard for messages – ISO20022
• Open standards, not proprietary standards
• Uses UKFMPG Standards. TeX members also
members of UKFMPG
• Model for other products
• Model for other markets
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TeX – Reasons why
• Joining fee of £12k per group.
• Annual fee of £3k for a platform/ISA Manager/Service
provider
• A fund manager pays £2k pa
• Contract club means everybody knows the terms they
deal on, which reduces contract risks and legal costs
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TeX – How much will it
cost?
Join TeX
NOW
Enquiries:
Carol Knight – [email protected] 01642 666989
Jeffrey Mushens – [email protected] 07939 575093