Investment trusts seek exclusion from FCA regulatory changes

City bosses are asking regulators to exclude investment trusts from upcoming rule changes. They believe that new regulations could hurt the already struggling sector. The Financial Conduct Authority (FCA) is set to make major changes to how it regulates investments for UK retail investors. This overhaul will replace existing regulations with a new framework called Consumer Composite Investments (CCIs). The FCA claims these changes aim to provide better outcomes for investors and simplify the product information they receive. Investment trusts have faced tough times, with many trading at discounts to their net asset value. Industry leaders criticized the old rules for causing confusion and contributing to declines in investor interest. They welcomed the removal of outdated regulations but expressed concern that the new rules may overlook the unique nature of investment trusts. In their response to the FCA, industry figures emphasized that investment trusts already comply with strict regulations. They highlighted that these trusts are quoted companies with considerable oversight and requirements for transparency. The group warned that applying the new rules to investment trusts could damage their appeal and lead to unsatisfactory outcomes for consumers. They urged regulators to consider the distinct characteristics of investment trusts to avoid unintended negative consequences.