Robo-Advisors and the Legal Duties of their Providers

Abstract

In Japan a report of the Financial Service Agency suggesting that the average couple would need a fund of 20 million Yen (about 170.000 Euro) to support their post-retirement income created sensational headlines in June 2019. One of its effects has been renewed interest on the part of the general public in asset management. This reflects a longer term trend ‘from savings to investment’ in attitudes towards pension provision. Meanwhile, ‘Robo-Advice’ in Japan has spread rapidly since its first appearance in 2015. This paper will address the following questions: (1) what happens when a human investment advisor is replaced by an automated service (‘Robo-Advice’); and (2) how should the legal framework of financial regulation and civil liability be changed to accommodate such a development?