The commission will be accepted only if there is a link between the payment and an investment in a retail product made by the client following a personal recommendation before the RDR deadline.

FSA also added that commission cannot be paid to advisers when top-ups are paid into products, but could continue if advice leads to no change to the product, although any new payment for the advice would need to take the form of adviser charging.

Further, the adviser’s commission can continue to be paid when changes take place automatically following pre-RDR advice, with if new advice is given post-RDR.

Though new commission cannot be accepted post-RDR even if the adviser intends to refund it to the client, FSA said that the trail commission for pre-RDR advice or transactions could be offset against adviser charges.

The regulator has also resisted pressure from the Investment Management Association to ban the continuation of the payment of trail commission where there is fund switching within an insurance product.

Regarding the independent advisory firms, FSA said that advice firms cannot be called independent if they have one or more restricted adviser after the RDR.