The GISC is in talks with the Office of Fair Trading (OFT) to head off any possible legal challenge over compulsory membership of the organisation.

AiiB chairman and GISC board member, Mike Slack, said: "Our proposals will have to be passed by the OFT as not being anti-competitive to business, or as a barrier to people being able to carry out business.

"Obviously, under OFT rules you can't do things that are anti-competitive. The proposals have been well received by the OFT and will be considered in the normal way."

This week a number of leading insurers told Insurance Times that they will stop doing business with brokers who fail to sign up to GISC. "We're members of the ABI, and we'll stick to the ABI line on this," said a spokesman for Axa.

However, Royal & SunAlliance and Cornhill said they were not in a position to give a firm commitment either way because they were reviewing the consultation document.

Meanwhile, the rift between AiiB and the IIB over GISC is growing. This week AiiB secretary general Chris Arter branded his IIB counterpart Andrew Paddick a "luddite" over comments he made in last week's Insurance Times.

Paddick, whose members are regulated by the IBRC, said: "We want to preserve the situation of insurance brokers as a stand-alone body of professionals. We do not want to share an identity with 30,000 to 40,000 insurance agents or "peddlers of insurance".

Arter described the remarks as "exasperating" and "insulting" to professional intermediaries and agents operating within general insurance.

"The IBRC failed to address the vital issues that the graft GISC consultation document has not been afraid to confront, including, monitoring of all those involved in general insurance under one code, monitoring of sales practices, training and competency. It is time to look forward and to work to try to get closer to those ideals of 25+ years ago," he said.

However, this week Paddick said he remained unconvinced that the GISC could offer the same level of regulation as that currently enjoyed by his members under IBRC.

He said his preferred option would be a continuation of the status quo with the IBRC continuing to operate albeit on a non-statutory basis but with an expanded membership.

After a poor start to the GISC consultation process with attendance levels at roadshows on the low side, issues of common concern are beginning to emerge. Last week's Manchester roadshow, hosted by the GISC chairman Anthony Howland Jackson, had the largest attendance yet with over 100 brokers – twice as many as turned up in Glasgow the previous week.

The crucial issue for the AiiB will be the cost of membership.

According to AiiB general secretary Chris Arter, the GISC's proposal to levy a membership fee of 0.1% on intermediaries' commission and fee income has provoked adverse reaction among members.

Arter said the combined cost of the industry's three existing regulatory schemes, for Lloyd's, the IBRC and ABI code for intermediaries, is currently £10 million.

Arter said that GISC would shift this burden disproportionately on to intermediaries.

He said: "Independent intermediaries are expected to contribute to the cost of regulation for the first time. Whereas their membership of the ABI scheme is currently met by insurers."

A spokeswoman for the GISC said that chief executive Chris Woodburn was aiming to run a tight ship.

She said: "A number of our services including monitoring will be performed by contractors."

She added: "We are certainly not building a fat cat edifice here."

However, GISC was unable to give Insurance Times details of its directors' salaries, information keenly sought by our intermediary readers. The request is to be raised at the next GISC board meeting.