A wide-ranging investigation into the platform market will consider whether advised clients receive price and service benefits from providers.
The Financial Conduct Authority (FCA) today published the terms of reference for its study into the platform market.
As part of the study, which will consider advised and non-advised platforms, the regulator said it would look into whether advisers pass on the benefits of using platforms to their clients.
This will include a focus on adviser charges, as well as whether additional services offered by a platform are beneficial to the consumer.
'Advisers choose platforms on behalf of their clients who in turn pay for the platform service. Advisers may therefore have bargaining power and influence regarding platform fees and services, which in turn may be passed onto investors if competition is working effectively,' the paper said.
The review will also consider how platforms compete to win business from advised clients. To do this the FCA will look at how advisers choose a platform, and ask whether it benefits the end investor. This will also include looking at whether platforms impose 'restrictions' on advised clients accessing their platform and how platforms deal with 'orphan clients' who no longer have an adviser.
Despite the focus on how advisers use and choose platforms the FCA stressed the market study would not assess the overall advice market.
'This market study will not focus on competition between financial advisers and we will not assess whether advisers compete on price and quality when offering financial advice services,' it said.
'The suitability and value of advice will not therefore be within the scope of the market study.'
The regulator said the 'positive findings' of its recent suitability review showed the retail distribution review had been successfully adopted.
'We will also conduct a review of the outcomes from the financial advice market review in 2019,' it said.
The FCA will publish an interim report into the platform market by summer 2018.
Read the full terms of reference for the FCA's platform study here.