Amongst the 15 broad risk categories set out in the FSA’s ‘Conduct Risk Outlook 2012’ (see Regulatory Roundup 39 for a link to this document) are Exchange Traded Products (ETPs), of which Exchange Traded Funds are a subset.
Over the last 18 months the FSA has conducted thematic visits to a number of providers who account for over 70% of the EU market. We are advised that the Regulator found some evidence of poor practice and firms have been asked to address risks where issues have been found.
In order to raise awareness of the key features and risks that the FSA considers important, it has issued a factsheet for investment advisers. Readers are made aware of the consultation paper issued by ESMA in January of this year on the regulatory framework for ETFs which may eventually result in changes to the factsheet. (Please note, it appears that links to the ESMA website do not open on some web platforms. If you cannot access the document using the link please copy and paste the following address into your browser: http://www.esma.europa.eu/system/files/2012-44_0.pdf).
