Property
We work particularly closely with the investment property sector, where financial services regulation is having an increasing impact. Although real property as such is not an investment within the scope of the FSMA, property companies and advisers are increasingly involved with funds and similar vehicles which are subject to financial services regulation, even if the underlying property itself is not. We advise a number of the major firms of surveyors - and smaller specialist property firms - on the regulatory issues and compliance implications of their investment or fund management activities.
For larger firms, we have provided consultants as secondees to provide interim compliance support, often across more than one regulated entity within the group. We have also assisted group companies with developing their European money laundering strategy, as well as helping prepare for MiFID.
MiFID has also had a major impact on the way in which property firms deal with their customers and in particular around the classifications of retail and professional clients. Many firms now find that it is difficult to opt a retail client up to professional status and thus find that they require permissions to deal with retail clients which brings with it an extra layer of regulatory scrutiny (for example, in relation to the FSA's treating customers fairly initiative). We can help firms address the cultural issues which can arise and to translate the FSA's expectations into a strategy which is meaningful for their business.
We also assist firms with a range of other compliance issues such as questions of corporate structure - whether one or more new vehicles should be established to service regulated activities, and how activities can be structured in order to meet regulatory capital requirements in the most efficient and cost-effective way. We have helped with applications for authorisation of new entities, and the regulatory consequences of changing status from partnership to LLP. We have prepared procedures and other working documentation, and developed tailored training programmes, delivered both face-to-face and through e-learning platforms.
Many property firms also carry out general insurance activities ranging from arranging and the provision of advice through to the handling of claims. The FSA takes a principles-based approach to the regulation of insurance mediation. This allows firms some flexibility in deciding how they will comply with the requirements by focusing on the outcomes rather than the specific method of delivery, but this approach brings a level of uncertainty in understanding exactly what the FSA's expectations may be. We have specific in-house expertise in relation to the insurance arranging activities of surveyors and property firms. We provide support to a number of property clients in this area ranging from the provision of advice in relation to specific compliance queries and perimeter issues through to carrying out healthcheck reviews which test a firm's compliance.