The price war has been one of the big talking points this year both sides of the pond after US-based platform Social Finance launched a range of zero-fee ETFs in February.
Salt Financial took this one step further earlier this month when it filed the Salt Low truBeta US Market ETF (LSLT) in the US, which pays investors 0.05% to hold this. It should be noted all the ETFs have management fees that have been waived by the respective asset managers.
McNeil (pictured) slated the launches in the US, describing them as "gimmicks" and something investors should steer clear of.
"It is worth remembering zero fund fees are a misnomer - it is like when you apply for a mortgage and see all the special offers, but when you look at the small print you see all sorts of clauses. Essentially, it is just a gimmick to get people on to a given platform to start with."
Furthermore, he said there is less demand for zero-fee products from the European ETF market because it has an institutional focus whereas the US is more retail-orientated.
However, fees have also come down considerably in Europe. Last March, Lyxor launched its core ETF range, going as low as 0.04% on two ETFs, while Amundi's core suite charges 0.05% across the board.
Some 10 years ago, Deutsche Asset Management launched a zero-fee ETF as part of its db x-tracker range, the DJ Euro Stoxx 50 ETF, however the fee was subsequently increased after the fund changed from synthetic to physical replication.
Whether we will see another zero-fee ETF in Europe remains to be seen however, McNeil believes it is unlikely this will occur.
"It will be harder for this to take root in Europe because it is more competitive here, with far more indices to monitor and focus on.
"You may well see more firms do such gimmicks as this, but for us, that is precisely what it is, and investors need to be wary."
McNeil is not the first industry figure to warn investors about the issues around low cost ETFs. Simon Klein, head of passive investments, EMEA and Asia at DWS, said the pure focus on cost is a "misleading and dangerous" development for the space.