MiFID II

Recent Articles

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  05.05.2023

  FCA con­firms changes to UK equity mar­kets trans­par­ency re­gime and fi­nal­ises im­ple­ment­a­tion timetable

  In PS23/4: Improving Equity Secondary Markets, the Financial Conduct Authority (FCA) has confirmed a range of targeted changes to the UK’s post-trade transparency regime, pre-trade transparency waivers and tick size regime for equity instruments that it consulted on in July 2022. The introduction of the new designated reporter (DR) regime will also affect trading in non-equity instruments. The FCA also provides an update on potential further reforms to operational resilience standards for trading venues and the retail service provider model.Firms will be pleased to see that the FCA has listened...

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  29.03.2023

  ESMA Pub­lic State­ment on de­riv­at­ives on frac­tions of shares

  On 28 March 2023, the European Securities and Markets Authority (ESMA) published a Public Statement on derivatives on fractions of shares. Fractional share trading has risen in popularity in the UK and European markets in recent years, enabling retail investors to get direct exposure to tech companies and other issuers whose shares may be relatively expensive and which have traditionally been more frequently accessed indirectly through mutual funds. This exposure can be achieved through a trust-based or “co-ownership” model, under which multiple clients each have a beneficial claim...

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  14.10.2022

  ESMA Guidelines on suit­ab­il­ity up­dated to take in­to ac­count sus­tain­ab­il­ity factors, risks and pref­er­ences of the cli­ents

  Firms (that are inter alia investment firms and credit institutions) (i) providing investment advice or portfolio management or (ii) selling or advising clients in relation to structured deposits have to provide suitable personal recommendations to their clients, in particular to their retail clients, or they have to make suitable investment decisions on behalf of their clients. In order to match clients with suitable investments, Firms should establish policies and procedures to ensure that they consistently take into account: (i) all available information about the client necessary to assess...

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  18.03.2022

  The Whole­sale Mar­kets Re­view – no “big bang”

  Regulatory perimeter for trading venues. Although the Government recognises the need for greater clarity in this area, it is intended that the FCA will consult on new guidance in the first instance, rather than the Treasury bringing forward amendments to the definition of a “multilateral system”, the concept of which underpins the trading venue regulatory perimeter. Removal of some restrictions on MTF and OTF operators. The Government believes that it would be appropriate to remove the matched principal trading restrictions for investment firms operating a multilateral trading facility...

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  02.02.2021

  The new pruden­tial re­gime for in­vest­ment firms: key points from the first FCA Con­sulta­tion Pa­per

  Key points to note from the Consultation Paper What is covered in the Consultation Paper and what is missing? The Consultation Paper includes the first tranche of draft rules that will form part of a new single prudential sourcebook in the FCA Handbook for investment firms called “MIFIDPRU”. We expect that the process of simplifying and bringing the rules together in one place will be welcomed by many investment firms. The Consultation Paper covers some aspects of the application of the MIFIDPRU rules (i.e. which firms are subject to the rules and when), investment firm groups and prudential...

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  20.01.2021

  ESMA ob­serves ques­tion­able re­verse so­li­cit­a­tion prac­tices after Brexit

  The European Securities and Markets Authority (ESMA) has issued a statement to remind firms of the rules on reverse solicitation under MiFID II. It says, that since the end of the UK transition period on 31 December 2020, some firms appear to be trying to circumvent MiFID II requirements and questionable reverse solicitation practices have emerged. These practices include using general clauses in Terms of Business or online pop-up “I agree” boxes, whereby clients state that any transaction is executed on the exclusive initiative of the client. In ESMA’s view, these practices...

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