The UK regulator’s powers to monitor and encourage competition in the asset management industry was a “rarity”, according to the director of strategy and competition, Christopher Woolard, who claimed its mandate was frequently misunderstood as a result.
Speaking at the annual meeting of the Securities Industry and Financial Markets Association’s (SIFMA) in Washington DC, Woolard explained the FCA’s recent asset management market study examined competition, not misconduct.
Attempting to tackle the apparent misconceptions, Woolard said: “Competition is not just about having low prices or a choice of numerous suppliers. Nor is it about simply demanding that dominant players are broken up.
“It’s about firms tackling each other on the basis of service, quality and price in an arena where players compete on merit.”
The FCA’s role was not to control competition but to enable it, he added.
“That means removing barriers to genuine and fair rivalry between firms and empowering consumers to make effective choices,” he said.
While he admitted the FCA’s work had not been welcomed by many, citing “consternation in some quarters”, Woolard defended the need for tighter regulation in the UK at a time when questions over the UK’s future are rife.
He went so far as to claim a major US group had chosen to invest in the UK purely because of the regulatory reform underway.
“One thing we do know is that a race to the bottom benefits no one,” he said.
“High regulatory standards are an essential part of the UK system. A so-called bonfire of regulations would not serve anyone’s long-term interests.”