The Royal Institution of Chartered Surveyors (Rics) has challenged the FSA and the Treasury over the need for authorisation of secondary intermediaries, said a report.
Rics said thousands of firms in the property and construction industry could be affected by the need to gain authorisation, with the cost to the sector reaching an estimated £10m.
According to the report, Rics said that across all sectors of business, up to 150,000 business would need to gain authorisation as secondary intermediaries, a figure far higher than the 20,000 to 25,000 predicted by the FSA.
The government has defended its decision, saying it consulted widely on its proposals before deciding to enforce regulation for secondary intermediaries.
According to the report, Rics claimed the government was to blame because it had decided to go much further than necessary in implementing a recent EU directive the regulation of general insurance. It said the legislation had not been thought through and would be damaging to business, and is encouraging its members to write to their MPs.
Rics chief executive, Louis Armstrong said FSA regulation will mean more costs, more form filling, more resources spent on compliance, and less healthy competition within the industry.
The protests from Rics come a month after the FSA confirmed that members of the National House Builders Council (NHBC) who participated in the NHBC’s Buildmark scheme would not have to be authorised.
