Why Your Friendly UK Adviser Can No Longer Help You in Prague
“I’ve got a UK pension. My adviser is in England. Surely they can just sign the paperwork?”
If only life after Brexit were that simple. One of the most common questions we receive at Aisa International is:
“Why can’t I just use a UK financial adviser to transfer my UK pension if I’m living in the Czech Republic?”
The cross border pension advice answer is surprisingly straightforward, although it has caught out many advisers—and quite a few pension providers.
Once upon a time
Before Brexit, life was relatively easy. A UK financial adviser authorised by the Financial Conduct Authority (FCA) could advise clients living anywhere within the European Union using passporting rights. One licence effectively opened the door to 30 countries.
Then Brexit arrived. The passport disappeared. Not literally, of course—but the regulatory passport did. Suddenly, many UK advisers discovered that while they could still advise people in Birmingham, they couldn’t necessarily advise someone sitting in Brno.
“But it's a UK pension!”
This is where the confusion begins.
The pension remains regulated by the FCA in the UK. However, investment advice is regulated according to where the client is resident. If you live permanently in the Czech Republic, the advice must be provided by a firm authorised to provide investment advice under Czech and wider EU regulation.
These are two entirely separate regulated activities.
Can't a UK adviser just make an exception?
No.
Professional UK firms are very aware that giving regulated investment advice into another jurisdiction without the appropriate permissions creates regulatory risk for both the adviser and the pension provider. Major UK pension providers therefore undertake enhanced due diligence before accepting transfer requests from EU residents to transfer their UK pension.
If you hold a UK pension and live permanently in the Czech Republic, the question is no longer simply ‘Is my pension regulated?’
It is also: ‘Who is legally allowed to advise me?’
Since Brexit, that has become a surprisingly specialised area. Fortunately, it is one we deal with every day.
Welcome To The Twilight Zone
Many expatriates experience something like this:
- UK adviser: ‘Sorry, you’re overseas.’
- Local adviser: ‘Sorry, we don’t advise on UK pensions.’
- Another adviser: ‘Sorry, we don’t hold the UK pension qualifications.’
Eventually somebody says: ‘Have you tried Aisa International?
Why is it so unusual?
Cross-border pension advice requires knowledge of UK pension legislation, HMRC rules, FCA standards, SIPP provider requirements, tax treaties, MiFID II, Czech regulation and international compliance. Those skills rarely exist within one advisory firm.
How does Aisa International do it?
Aisa International is authorised and regulated by the Czech National Bank to provide investment services under MiFID II. Our advisers also hold the UK pension qualifications required by many UK SIPP providers when advising on UK pension transfers and ongoing pension advice. We also work closely with our UK FCA regulated firm to assist with cross-border planning.
The advice is therefore provided by our EU-regulated entity, while the pension itself remains with an FCA-regulated UK pension provider. Each regulator oversees the part of the arrangement for which it is responsible.
Does that mean I lose UK protection?
No. Different parts of the arrangement fall under different regulatory systems. The UK pension provider remains FCA regulated, while the investment advice is regulated by the Czech National Bank. Each has separate responsibilities.
The Bottom Line
If you hold a UK pension and live permanently in the Czech Republic, the question is no longer simply ‘Is my pension regulated?’
It is also: ‘Who is legally allowed to advise me?’
Since Brexit, that has become a surprisingly specialised area. Fortunately, it is one we deal with every day.
About Aisa International
Aisa International s.r.o. is authorised and regulated by the Czech National Bank to provide investment services under MiFID II. We specialise in advising British expatriates and international clients on UK pensions, cross-border investment planning and retirement strategies, working with FCA-regulated UK pension providers where appropriate.
Disclaimer: This article is for general information only and does not constitute personal financial advice. Individual circumstances should always be assessed before any recommendation is made.
