The following article was written by Sophie Gerber, Director of regulatory and compliance solutions provider TRAction Fintech.
Time is of the essence in the lead-up to MiFID II and MiFIR
Sophie Gerber, TRAction Fintech
What is the implementation date for MiFIR & MiFID II?
Wednesday 3rd January 2018.
Is there likely to be any grace period for MiFID II implementation?
In short, no. After being put back a year from the original January 2017 implementation date, there is no likelihood of further postponement. The European Commission’s Vice President, Valdis Dombrovskis, recently said “the deadline for MiFID II was already extended once, so we do not plan further extension of the deadline”.
How much leniency are the regulators likely to show?
Regulators are likely to take a pragmatic approach to enforcement considering the size of the undertaking involved with MiFID II compliance.
Mark Steward, Director of Enforcement and Market Oversight at the FCA delivered a speech in September 2017 to this effect;
As always, we intend to act proportionately. In this context, this means we will not take a strict liability approach especially given the size, complexity and magnitude of the changes that are required to be in place. We are very aware of how much work many firms have been engaged in for a very long time now in re-tooling and preparing for next year. This means we have no intention of taking enforcement action against firms for not meeting all requirements straight away where there is evidence they have taken sufficient steps to meet the new obligations by the start-date, 3 January 2018… At the same time, we cannot create a floor for compliance below the required MiFID II standards and so our disposition is likely to be different where firms have made no real or genuine attempt to be ready or where key obligations are deliberately flouted.
What action should I be taking to prepare by the implementation date?
Based on the quote above, firms should take ‘sufficient steps’ to meet the obligations, which means making a ‘real or genuine attempt to be ready’. This should not be read to justify complacency; instead it should be seen as a reminder to prioritise compliance preparation and document the efforts. You should understand your obligations under the new regime, identify the changes required to your processes and structures, start making these changes and monitor outcomes.
Contact us for our pricing structure and further information on the ways we can assist you to be prepared for 3 January 2018.