FCA: Response to the EC Green Paper: Retail Financial Services
FCA has now published its response to the Green Paper. In addition to addressing the specific questions raised in the Green Paper, FCA sets out what it describes as overarching issues which it believes require greater understanding and research in order to determine whether, and where, further EC action is required. These include: potential gaps and challenges relating to MiFID/MiFIR, PRIIPS, MCD, PSD II, IDD and the Payment Accounts Directive’ disclosure; lack of certainty over application of the rules; collaboration for innovation; consumer risks; lack of familiarity and diversity of customers across the EU.
ESMA: Risk assessment on the temporary exclusion of exchange traded derivatives from Articles 35 and 36 of MiFIR
ESMA has published this report along with a press release which emphasises that it sees no need to temporarily exclude exchangetraded derivatives rom nondiscriminatory access to CCPs and trading venues. The report includes an overview of existing access arrangements in the EEA.
FCA: Speech by Edwin Schooling Latter: Electronification of trading
Text of this speech, given at the FIX 2016 EMEA trading conference on 6 April 2016 follows, in which Edwin Schooling Latter discusses how FCA views the increasing electronification of trading, its implications and consequences, including MiFID II related issues.
ESMA: MiFID suitability requirements – peer review report
ESMA’s peer review looks at how national regulators assess compliance with MiFID’s suitability requirements when firms provide investment advice to retail clients. Overall, ESMA found that although most national regulators understood the investment advice market in their jurisdictions and regularly reviewed distribution methods and business models, there is scope to adopt more proactive supervisory approaches and strengthen enforcement activities.
EC: Delegated Regulation in relation to MiFID II
A Delegated Regulation supplementing Directive 2014/65/EU of the European Parliament and of the Council with regard to safeguarding of financial instruments and funds belonging to clients, product governance obligations and the rules applicable to the provision or reception of fees, commissions or any monetary or nonmonetary benefits has been adopted.
EP: Rapporteur for MiFID II issued statement on MiFID II vote
The EP's Rapporteur for MiFID II issued a statement on the recent MiFID II vote regarding the oneyear postponement. Markus Ferber MEP noted the ECON vote will afford Member States time to transpose and implement the provisions and that 'the European Parliament also took the opportunity to amend certain other aspects of MiFID II that have proven to be problematic. I am now looking forward to finalise the negotiations with the Council swiftly in order to establish certainty for all relevant actors as soon as possible'.
ESMA: Guidelines on transaction reporting reference data order record keeping and clock synchronisation
ESMA has now published the responses to this MiFIRrelated November 2015 consultation , which may be downloaded individually via the following link.
ESMA: Q&A relating to the provision of CFDs and other speculative products to retail investors under MiFID
ESMA has published this QUA on the application of MiFID to the marketing and sale of financial CFDs and other speculative products to retail clients (e.g. binary options and rolling spot forex). ESMA also notes plans to publish further Q&As in the coming months.
FCA: Inducements and conflicts of interest thematic review: key findings
FCA has published a note of its key findings from its 2015 thematic review about benefits provided and received by firms conducting MiFID business, and those carrying out regulated activities in relation to a retail investment product. FCA notes that it has decided not to publish a full thematic report, as this work will be taken into account in the planned MiFID II consultation paper. Specific areas of concern were issues surrounding hospitality and costs incurred when facilitating training or educational material supplied by product providers. FCA also found that MiFID firms were not providing clients with an indication of the value of allowable benefits provided.
EC: published three letters regarding MiFID II RTS
The European Commission published three letters that DG FISMA addressed to ESMA regarding certain draft regulatory technical standards (RTS). Specifically, the letters relate to: draft RTS 20 on the criteria to establish when an activity is considered to be ancillary to the main business pursuant to Article 2(4) MiFID II; draft RTS 21 on the application of position limits to commodity derivatives pursuant to Article 57(3) and (12) of MiFID II; draft RTS 2 on transparency requirements in respect of bonds, structured finance products, emission allowances and derivatives under Articles 9 and 11 MiFIR.
European Parliament: MiFID/MiFIR
Two draft final reports on MIFID/MiFIR have been published (dated 11 April 2016) setting out new (marked up) text and which postpone the transposition dates of the Directive and Regulation by a year.
EC: Delegated Regulation in relation to MiFID
Commission Delegated Regulation of 15 April 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of that Directive has been adopted.
EC: Letters to ESMA in relation to MiFID II
The EC has published three undated letters to ESMA regarding its decision to endorse draft regulatory technical standards on the nonequity transparency, the ancillary test and position limits provided that certain changes are made.
COREPER has agreed, on behalf of the Council, its negotiating stance aimed at extending by one year the dates of transposition and application of new securities market rules. COREPER has asked the Netherlands presidency to start negotiations with the European Parliament as soon as possible, in order to enable adoption at first reading of a regulation enacting the extension. Under the Council's approach, the deadline for the member states to transpose MIFID II into national legislation would be set for 3 July 2017 and the date of application of both MIFID II and MIFIR would 3 January 2018. The Council has made amendments to the EC’s proposal concerning trading on own accounts, package transactions, alignment SFT Directive transactions and the date of application of certain provisions of MAR. Links to the markedup proposals are available via the following link.