Retail Distribution Review (RDR)

The Retail Distribution Review (RDR) was a UK-specific examination, conducted by the FSA, of the sale of investment products (including life policies, pensions, funds, and other investment schemes) to retail customers by financial advisers. The review began in June 2006, and concluded with new rules on remuneration published in March 2012, and Final Guidance on advice in June 2012. The new rules came into force on 31 December 2012. The main outcomes of RDR were: new training, accreditation and CPD requirements; a new distinction between "restricted" and "independent" financial advice (where, in the latter case, an adviser must consider all retail investment products available on the market); and a ban on receiving commission from product providers, and a requirement to disclose adviser charges to consumers up front.

The first stage of the FCA’s post-implementation review of the RDR (published in December 2014), together with thematic work regarding the disclosure of ongoing services and charges, has concluded that financial advisers are offering investors an increasingly professional service suited to their individual needs. Martin Wheatley, Chief Executive of the FCA, indicated that in 2015 the FCA will undertake a series of next steps in light of the review’s findings and that a further post-implementation review of the rules will take place in 2017.

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Retail Distribution Review (RDR) rules in force.

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