MFS and the UK Consumer Duty
MFS applies the UK Consumer Duty to its MFS Meridian Funds products that are offered to retail investors in the UK by distributors. Please see below for information on and how MFS has implemented the Consumer Duty.
What is the UK Consumer Duty?
Effective 31 July 2023, the UK Financial Conduct Authority (FCA) introduced the Consumer Duty principle that financial services firms must act to deliver good outcomes for retail customers.
The Consumer Duty principle sets out a higher standard of care that firms should provide to retail customers and is underpinned by cross-cutting rules that define how firms should act to deliver good outcomes and four outcomes rules relating to products and services offered (see below).
Cross-Cutting Rules
Under these rules firms must:
• Act in good faith towards retail customers;
• Avoid causing foreseeable harm to retail customers; and
• Enable and support retail customers to pursue their financial objectives.
Outcome rules relating to products and services
The Consumer Duty rules require firms to deliver the outcomes as it relates to the manufacturing and distribution of products and services across four key areas:
Products and services are appropriately designed and distributed for retail customers
Communications that support customer understanding
The price and value of the product or service provide fair value to retail customers
Design and deliver customer support
Please click on “MFS Consumer Duty Implementation” for information on our implementation of the Consumer Duty outcomes including our fair value assessment methodology.
FAQs
o MFS applies the Consumer Duty to the W and I share classes of each sub-fund of the MFS Meridian Funds.
o The MFS Meridian Funds is the EU UCITS investment funds established in Luxembourg and registered with the FCA for distribution into the UK. Such funds are not required to produce the value assessment report under COLL 6 of the FCA Handbook.
o However, MFS is committed to supporting distribution partners with their information needs to comply with their regulatory obligations. Please see here for information that MFS makes available on the implementation of the Consumer Duty including the methodology and findings relating to the Consumer Duty outcomes.
o The MFS Consumer Duty Implementation document (see link above) provides details about our implementation of the Consumer Duty outcomes including the methodology used to assess the fair value of our MFS Meridian Funds products.
o The findings of the MFS fair value assessment relating to the MFS Meridian Funds products are communicated in the European MiFID Template (EMT), which is on MFS designated platforms such as FE Fund and Broadridge.
o Yes, MFS participates in industry forums and trade association discussions on the Consumer Duty. MFS also welcomes engagement with distributors on the Consumer Duty.