Managing Complexity - Preparing for the impact of MiFID II and MiFIR


The EU's Markets in Financial Instruments Directive (2004/39/EC) (MiFID), and its implementing legislation, governs the pan-European requirements applicable to investment firms, banks, trading venues, and third-country firms providing investment services or carrying on investment activities in the EU.

On 3 January 2017, a new MiFID II Directive (2014/65/EU) and the Markets in Financial Instruments Regulation (Regulation 600/2014) (MiFIR) are to come into effect – as a result of which MiFID will be repealed and recast. The new legislation takes account of developments in markets and the trading environment since MiFID was adopted in 2004, including advances in technology, and the need for reform, in particular, for greater market transparency in response to the financial crisis.

MiFID II and MiFIR are part of a complementary programme of EU measures to reform financial services, which include the European Markets Infrastructure Regulation (EMIR) and the Market Abuse Regulation (MAR), the latter of which will take effect at the same time as MiFID II.

While national implementing legislation remains important, in contrast to MiFID, and reflecting increasing levels of EU regulatory integration, MiFIR is a directly applicable regulation and MiFID II will be followed by detailed technical standards which will have direct effect in Member States. These technical standards, and related guidance, are being drafted, or advised on, by the European Securities and Markets Authority (ESMA).

On 19 December 2014, ESMA published final technical advice (ESMA/2014/1569) to the European Commission and a second consultation paper (ESMA/2014/1570) on MiFID II and MiFIR. Publication of technical standards will follow in late in 2015 or early 2016. Only then will the FCA consult on changes to its own rules. The FCA has been clear that firms cannot hold back on developing their implementation plans until all the details are available. Efforts are required now, ahead of implementation in January 2017.

The Financial Regulation Group at Addleshaw Goddard is focused on helping clients understand and prepare for the implementation of MiFID II and MiFIR. We provide clients with services ranging from strategic advice, gap analysis, and answering discrete queries, to comprehensive and tailored project management programmes.

Key contact

Brian McDonnell

Brian McDonnell

Partner, Financial Regulation
London

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Watch these short clips for an overview on the revision of MiFID and how this will impact on commodity firms.

Introduction

Partner Brian McDonnell provides an outline of the revision of MiFID.

Commodity firms

Brian looks at how commodity firms will be affected.