How your firm should be planning, the MiFID legislative process and how we will be implementing the changes.
MiFID is a wide-ranging piece of legislation and, depending on your firm's business model, could affect a wide range of its functions, from client services to IT and HR systems.
You will need to start planning for the changes before:
- the EU implementing legislation is finalised
- the Treasury makes changes to the financial services legislation
- we make changes to our Handbook.
Read more detail about the changes to MiFID from the links to the right.
The legislative process
MiFID II has two levels of European legislation.
The MiFID II 'Level 1' framework was agreed in 2014 – this contains two linked pieces of legislation:
- a revised MiFID
- the Markets in Financial Instruments Regulation (MiFIR).
There is provision for Level 1 to be supplemented in many areas by various implementing measures (known as 'Level 2' legislation). These measures take two forms:
- 'delegated acts', drafted by the European Commission (EC) on the basis of advice by the European Securities and Markets Authority (ESMA)
- 'technical standards', drafted by ESMA and approved by the EC.
- provided advice on the delegated acts to the EC at the end of 2014
- delivered draft technical standards on 29 June, 28 September and 11 December 2015
The EC is in the process of endorsing the technical standards and recently adopted the delegated acts, and they are now subject to scrutiny by the European Parliament and Council before they come into force.
How we will implement the changes
We are discussing with trade associations and the Treasury the best way to implement MiFID II in the UK. Countries have until 3 July 2017 to adapt their domestic laws and regulation to the revised legislation.
But much of MiFID II takes the form of regulations which are directly applicable and do not need to be converted into domestic laws and regulations. We published our first consultation paper on changes to our Handbook in December 2015 and further consultations will follow in July and September 2016.
Our formal consultation processes will be supplemented by a range of other activities to support firms in implementing MiFID II. This will include events for firms to explain specific aspects of the revised legislation and interaction by supervisory teams and interested firms.