The relationship between investment managers and brokers has been identified by regulators in Europe and the US as a potentially important source of con icts of interest. Little systematic evidence is available, however, on this complex relationship, which involves trade execution, sell-side research, and a variety of bundled services. This paper reports the outcome of a landmark ruling under the UK Freedom of Information Act, which allowed us to obtain, from UK pension funds, information on commissions, trading activity, payments for research and other variables. We find that following recent regulatory changes in the UK to increase transparency, average commission rates have fallen. However, trading has increased signicantly, resulting in total commission payments to brokers more than doubling between 2003 and 2007
