InVest â€“ March 2017
Fund (EIF) and the British Business Bank (BBB) sign an agreement under the European Commission's InnovFin initiative to
help SMEs in the UK access an estimated GBP 30 million in additional financing; HM Treasury publishes a response to the
MiFID II transposition consultation and the European Parliament updates its procedure file on the proposed Regulation on
Money Market Funds.
â—„ Updated version of IA guidance for members on authorised funds
â—„ FCA highlights concerns about investment managers and best execution
â—„ European Commission CMU report on addressing national barriers to capital flows
â—„ IOSCO final report on loan funds survey
â—„ Peter Harrison appointed to lead Investment Association board
â—„ ESMA launches new Q&A tool
â—„ Joint Committee of ESAs consults on PRIIPs with environmental or social objectives
â—„ FCA discussion paper on illiquid assets and open-ended investment funds
â—„ IOSCO second review of implementation of significant foreign exchange benchmark
â—„ ESMA Risk Assessment Work Programme 2017
â—„ ESMA report on distributed ledger technology applied to securities markets
â—„ Investment Plan for Europe: GBP 30 million for innovative UK businesses
Investments & Investment Services
â—„ ESMA issues implementing rules for package orders under MiFID II
â—„ FIA, GFMA, ISDA and EFET joint response to ESMA on MiFID II position limits proposals
â—„ CLLS responds to FCA's third consultation on implementation of MiFID II
â—„ ESMA writes to Commission about MiFID II systematic internalisers
â—„ ESMA revised draft ITS on position reporting under MiFID II
â—„ HM Treasury publishes response to MiFID II transposition consultation
EMIR & Derivatives
â—„ European Commission adopts Delegated Regulation on list of exempted entities under EMIR
â—„ Delegated Regulation amending Delegated Regulation on RTS on risk mitigation techniques for uncleared OTC
derivative contracts under EMIR published in OJ
â—„ FCA statement on variation margin deadline under EMIR
â—„ Council of the EU decides not to object to the Commission Delegated Regulation further extending temporary
clearing exception for PSAs under EMIR
â—„ Responses to ESMA consultation on draft RTS on data to be made publicly available by trade repositories
â—„ Joint Committee of ESAs and IOSCO publish statements on variation of margin exchange under EMIR
â—„ ESMA publishes responses to consultation on supervision fees for trade repositories under SFTR and EMIR
â—„ ICMA urges European Commission to consider concerns relating to mandatory buy-in regime under CSDR
â—„ European Parliament to consider MMF Regulation
Updated version of IA guidance for members on authorised funds
The Investment Association has published an updated version of the guidance it has given to members on authorised funds.
IA, 6 March 2017
FCA highlights concerns about investment managers and best execution
The FCA has published a press release which expresses concern about how investment managers are failing to ensure
effective oversight of best execution. In particular they are concerned about:
â—„ How poor practices have not been addressed since its 2014 thematic review on the topic.
â—„ Poor use of management information on execution costs and an inability to evidence any improvement to execution
process based on cost data.
â—„ Compliance staff not being empowered to provide effective challenge on execution quality.
FCA, 3 March 2017
European Commission CMU report on addressing national barriers to capital flows
European Commission published a report as part of its capital markets union (CMU) initiative on addressing national barriers to
capital flows. In the report, the Commission sets out the initial findings of its expert group of representatives of member states
on national barriers to cross-border capital flows and the steps that the Commission expects member states to take to address
them. The issues highlighted include:
ï‚· Barriers to the cross-border distribution of investment funds.
ï‚· National approaches to crowdfunding.
ï‚· Residence requirements on managers of financial institutions.
EC, 27 February 2017
IOSCO final report on loan funds survey
The International Organization of Securities Commissions (IOSCO) has published its final report setting out its findings following
a survey on loan funds. IOSCO launched a questionnaire, in December 2015, to gather information from the members of its
Committee on Investment Management on existing practices and experience as regards loan funds in the area of investment
funds. The report concludes that further work on loan funds is not warranted at this stage. However, it notes that IOSCO will
continue to monitor this segment of the fund industry with a view to possibly revisiting it for further work, depending on market
IOSCO, 20 February 2017
Peter Harrison appointed to lead Investment Association board
The Investment Association has announced that Peter Harrison has been appointed Chair of the Board and will adopt the role
from 1 May 2017.
Investment Association, 15 February 2017
ESMA launches new Q&A tool
ESMA has developed a new webpage used as a Q&A tool, which aims to provide a means for ESMA to collect and address
questions from stakeholders publicly.
ESMA, 10 February 2017
Joint Committee of ESAs consults on PRIIPs with environmental or social objectives
The Joint Committee of the European Supervisory Authorities, otherwise known as the EBA, EIOPA and ESMA, has published
a consultation paper on packaged retail and insurance-based investment products with environmental or social objectives,
following a request for technical advice from the European Commission in May 2016.
European Supervisory Authorities, 10 February 2017
FCA discussion paper on illiquid assets and open-ended investment funds
A discussion paper has been published by the FCA which considers some of the risks that arise when consumers use open-
ended investment funds to gain exposure to illiquid assets.
FCA, 8 February
IOSCO second review of implementation of significant foreign exchange benchmark
The International Organization of Securities Commissions (IOSCO) published a report on its second review of the
implementation of IOSCO's principles for financial benchmarks by WM in respect of the WM/Reuters 4 p.m. closing spot rate.
The report found that the administrator had made very significant progress, with most of the recommendations from the earlier
review having been implemented. However, some room exists to improve and refine recently implemented policies and
IOSCO, 7 February 2017
ESMA Risk Assessment Work Programme 2017
ESMA has published its Risk Assessment Work Programme, setting out its work priorities for 2017. This Risk Assessment Work
Programme provides an overview of the analytical, research, data and statistical activities by ESMA.
ESMA, 7 February 2017
ESMA report on distributed ledger technology applied to securities markets
ESMA published a report (dated 7 January 2017) on distributed ledger technology (DLT) applied to securities markets. The
report sets out ESMA's view on DLT, its possible applications, benefits, risks and how it maps alongside existing EU regulation.
ESMA's position is that regulatory action is premature at this stage, considering that the technology is still at an early stage.
ESMA, 7 February 2017
Investment Plan for Europe: GBP 30 million for innovative UK businesses
The European Investment Fund (EIF) and the British Business Bank (BBB) have signed an agreement under the European
Commission's InnovFin initiative to help small and medium-sized enterprises (SMEs) in the UK access an estimated GBP 30
million (ca. EUR 35 million) in additional financing. This transaction benefits from the support of the European Fund for Strategic
Investments (EFSI), the heart of the Investment Plan for Europe. So far, the UK has been the second largest country of
operation for EFSI backed financing with support going to renewable energy, a new hospital in Birmingham, smart meters and
EC, 7 February 2017
Investments & Investment Services
ESMA issues implementing rules for package orders under MiFID II
The European Securities and Markets Authority (ESMA) has published today its final report on draft regulatory technical
standards regarding the treatment of package orders under the amended Markets in Financial Instruments Directive (MiFID II)
ESMA, 28 February 2017
FIA, GFMA, ISDA and EFET joint response to ESMA on MiFID II position limits proposals
Futures Industry Association (FIA), the Global Financial Markets Association (GFMA), the International Swaps and Derivatives
Association (ISDA) and the European Federation of Energy Traders (EFET) jointly submitted two comment letters to the
European Securities and Markets Authority (ESMA) on the position limits regime to be introduced under MiFID II. The first letter
relates to the application of position limits to products listed in Annex I, section C.10 of MiFID II. FIA, GFMA, EFET and ISDA
argue that position limits should only apply to those products with a link to commodities, ie not inflation swaps. The second letter
requests a clarification from ESMA that contracts traded on a third-country (ie non-EU) venue should not be considered OTC for
the purposes of the position limits regime.
FIA 22 February 2017
CLLS responds to FCA's third consultation on implementation of MiFID II
City of London Law Society (CLLS) Regulatory Law Committee published its response (dated 4 January 2017) to the FCA's
third consultation on implementation of the MiFID II Directive
CLLS, 17 February 2017
ESMA writes to Commission about MiFID II systematic internalisers
ESMA has published a letter it has written to the European Commission (DG FISMA) relating to the MiFID II Directive
(2014/65/EU) and systematic internalisers (SIs). ESMA has become aware that some investment firms that currently operate
broker-crossing networks might be seeking to circumvent MiFID II requirements by setting up networks of interconnected SIs
and other liquidity providers. Such arrangements allow SIs to cross third party buying and selling interests via matched principal
trading, or other types of back-to-back transactions. The arrangements currently focus on trading in shares, but could potentially
be extended to other financial instruments.
ESMA, 1 February 2017
ESMA revised draft ITS on position reporting under MiFID II
A revised draft implementing technical standard on position reporting under the MiFID II Directive has been published by
ESMA.This was originally published in December 2015, but since then ESMA has identified a number of technical amendments
that it deems necessary for the correct functioning of the position reporting of commodity derivatives.
ESMA, 10 February 2017
HM Treasury publishes response to MiFID II transposition consultation
HM Treasury has published the summary of responses it has received to its consultation on transposing the MiFID II Directive
into national law.
HM Treasury, 9 February 2017
EMIR & Derivatives
European Commission adopts Delegated Regulation on list of exempted entities under EMIR
The European Commission has adopted a Delegated Regulation amending EMIR with regard to the list of exempted entities.
European Commission, 2 March 2017
Delegated Regulation amending Delegated Regulation on RTS on risk mitigation techniques for uncleared
OTC derivative contracts under EMIR published in OJ
The Commission Delegated Regulation (EU) correcting Delegated Regulation (EU), which supplemented EMIR with regulatory
technical standards (RTS) on risk mitigation techniques for uncleared OTC derivative contracts under Article 11(15) was
published in the Official Journal of the EU (OJ). The correcting Delegated Regulation adds two new paragraphs to Article 37. It
explains that these paragraphs are analogous to the existing Articles 36(2) and 36(3), with the result that where an intragroup
transaction takes place between an EU entity and a third country entity, the exchange of variation margin will not be required
until three years after entry into force of the Regulation where there is no equivalence decision for that third country. Where
there is an equivalence decision, the requirements will apply on the later of four months after the entry into force of the
equivalence decision, or according to the general timeline.
OJ, 25 February 2017
FCA statement on variation margin deadline under EMIR
The FCA has published a statement on the 1 March 2017 deadline for compliance by firms with the new regime for variation
margin under EMIR (the Regulation on OTC derivative transactions, central counterparties and trade repositories).
FCA, 23 February 2017
Council of the EU decides not to object to the Commission Delegated Regulation further extending temporary
clearing exception for PSAs under EMIR
The European Parliament has updated its procedure file on the proposed Commission Delegated Regulation amending EMIR,
and has decided not to object to the Commission Delegated Regulation on the further extension of the transitional periods
related to pension scheme arrangements.
European Parliament, 23 February 2017
Responses to ESMA consultation on draft RTS on data to be made publicly available by trade repositories
ESMA has published a webpage which contains all of the responses to its consultation paper on draft regulatory technical
standards on data to be made publicly available by trade repositories under Article 81 of EMIR (ESMA/2016/1661).
ESMA, 23 February 2017
Joint Committee of ESAs and IOSCO publish statements on variation of margin exchange under EMIR
The Joint Committee of the European Supervisory Authorities, which combines the EBA, ESMA and EIOPA, has published a
statement on variation margin exchange under the EMIR regulatory technical standards on risk mitigation techniques for
uncleared OTC derivative contracts under Article 11(15) of EMIR. The International Organisation of Securities Commissions had
also published a statement on the same issue.
Joint Committee of the European Supervisory Authorities, 23 February 2017
ESMA publishes responses to consultation on supervision fees for trade repositories under SFTR and EMIR
ESMA has published the responses it has received to its consultation on draft technical advice to the European Commission
about fees for trade repositories under the Regulation on reporting and transparency of securities financing transactions ((EU)
2015/2365) and on certain amendments to the fees under EMIR (the Regulation on OTC derivatives, CCPs and trade
repositories) (Regulation 648/2012).
ESMA, 14 February 2017
ICMA urges European Commission to consider concerns relating to mandatory buy-in regime under CSDR
The International Capital Market Association has published a letter it had sent to the European Commission relating to the
changes being made to the rules and recommendations for the secondary market related to the buy-in and sell-out procedures.
ICMA, 6 March 2017
European Parliament to consider MMF Regulation
The European Parliament has updated its procedure file on the proposed Regulation on Money Market Funds (MMF
Regulation). The procedure file indicates that the Parliament will consider the proposed Regulation during its plenary session to
be held from 13-16 March 2017.
European Parliament, 3 March 2017
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