ESMA updated MiFID II Q&A


We are just some weeks away from the year of the Dog. This means that very soon all EU brokers will have the new set of rules to obey. In regards to this matter, ESMA updated MiFID II Q&A, where it clarifies all the necessary points related to the upcoming 2018 MiFID II Regulations.

13 November, AtoZForex The primary regulator of the European financial markets, the European Securities and Markets Authority (ESMA) has published an important announcement on its website. The supervisor had informed the public that it has added 4 new points to its Q&A document.

ESMA updated MiFID II Q&A with 4 new points

The Q&A document from ESMA is specifically outlining the implementation of investor protection topics under the upcoming Market in Financial Instruments Directive and Regulation (MiFID II/ MiFIR). In fact, the MiFID II regulations deadline is set for 3rd January 2018. Ahead of the regulatory change, all EU market participants must undergo certain procedures to comply with the new rules.

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The latest addition to the ESMA MiFID II Q&A includes 4 questions and answers. To be more specific, the EU regulator has added Q&As in regards to the topics of post-sale reporting, record keeping, and inducements.

Following on this, some of the questions updated by the ESMA, include:

"Are securities financing transactions (SFTs) in scope of the MiFID II requirements for order record keeping, as outlined in Article 16(6) of MiFID II and further specified in Section 8 of

MiFID II Delegated Regulation?"

"Does the obligation in Article 62(1) of Commission Delegated Regulation (EU) 2017/565 to report on the overall value of a client’s portfolio depreciating by a 10% threshold on a particular

business day applies only to retail clients?"

"Does Article 24(9) of MiFID II also apply to payments made by investment firms to a third party in relation to the provision of the investment service of investment advice provided on an independent basis or of portfolio management?"

You can find the official ESMA Q&A Document here.

MiFID II Deadline Preparations

As a matter of fact, the whole ESMA Q&A document is aiming to provide clarification on the following topics:

• Best execution

• Suitability and appropriateness

• Recording of telephone conversations and electronic communications

• Post-sale reporting

• Record keeping

• Investment advice on an independent basis

• Inducements (research)

• Information on charges and costs

• Underwriting and placement of a financial instrument

• Client categorisation

• Inducements

As ESMA updated MiFID II Q&A, the upcoming MiFID II aims to solidify the protection of investors. It will do so by both bringing the new requirements and reinforcing the old ones. The primary purpose of the ESMA Q&A document is to promote common supervisory methods and practices regarding the application of MiFID II guidelines.

The EU regulatory body further highlights that it will work further on developing this Q&A document on investor protection topics under MiFID II. The supervisor aims to add questions and answers to the topics that are already covered in the document. It also is planning to add new topics.

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