Hogan Lovells

Key Dates

Consultation and draft regulations issued on 29 July 2019.

Consultation closes on 2 September 2019.

The draft Occupational Pension Schemes (Governance and Registration) (Amendment) Regulations 2019 expected in force on 6 April 2020.

The Investment Consultancy and Fiduciary Management Market Investigation Order 2019, in force on 10 June 2019.


The DWP has issued a consultation paper and draft regulations, following the Competition and Markets Authority (CMA)'s investigation into the market for investment consultancy (IC) and fiduciary management (FM).

The CMA previously made an order, the Investment Consultancy and Fiduciary Management Market Investigation Order 2019, in force on 10 June 2019. The Order requires occupational pension trustees to set strategic objectives for investment consultants and to conduct a competitive tender before appointing a fiduciary manager, in certain circumstances.  These obligations on trustees have effect from 10 December 2019.  The provisions of the Order are expected to cease to have effect after similar requirements in DWP regulations come into force on 6 April 2020.

Draft guidance from the Pensions Regulator was issued on 31 July 2019 (please see separate entry).

Relevant trust schemes

A new part 6 will be added to the OPS (Scheme Administration) Regulations 1996/1715, concerning the governance of "relevant trust schemes".  Broadly, a relevant trust scheme will be an occupational pension scheme established under trust, other than:

Investment consultants: requirement to set objectives

Trustees of a relevant trust scheme will be required to set objectives for each IC provider, having regard to the statement of investment principles (SIP), as far as relevant.

Meaning of fiduciary management (FM) provider

A provider will be a FM provider if it meets both conditions 1 and 2:

Fiduciary management: requirement to carry out a qualifying tender process

The CMA Order (please see above) sets out similar requirements to those described below, but coming into force on 10 December 2019.

Under the draft regulations, the "asset management threshold" will be met where, immediately before 6 April 2020, FM providers were appointed to manage (in aggregate) 20% or more of the scheme's "manageable assets".  For this purpose, manageable assets are the scheme's assets, excluding any buy-in policies. 

Where the asset management threshold is met, trustees must carry out a "qualifying tender process" in respect of their existing FM providers within five years of the earliest appointment of the existing providers or, if later, 9 June 2021.

If the asset management threshold is not met on 6 April 2020, the trustees must carry out a qualifying tender process (including in respect of any existing FM providers) before appointing a FM provider or increasing the assets managed by an existing provider, if the asset management threshold will be met after the appointment or increase.  

Qualifying tender process

To undertake a qualifying tender process, the trustees must:

Exceptions from FM tender requirement

Trustees will not be required to undertake a qualifying tender process where the person to be appointed is:

Information on scheme return

Trustees will have to provide information about their IC and FM providers on the scheme return (via Exchange), and must report their compliance with the objectives and tender requirements, or explain any non-compliance.

The following will be removed as registrable information: whether the scheme is a public service scheme; whether the scheme benefits from a Crown guarantee; and the nature of the employer's business.

Compliance with IC and FM requirements

The Pensions Regulator will have power to issue compliance notices and penalties up to £50,000 (£5,000 for individuals).


The CMA published its final report of its market investigation on 12 December 2018.  The CMA found in relation to both IC and FM:

The government published a joint response on 12 March 2019, committing (amongst other things) to implement in pensions law the CMA's recommendations on mandatory competitive tendering of FM services; setting objectives for IC services; and enabling the Pensions Regulator to oversee the new trustees' duties.

Date Accessed: 28/05/2022