In true MiFID style

In true MiFID style

Christian Voigt

Senior Regulatory Adviser at Fidessa

Christian is a Senior Regulatory Adviser at Fidessa. He focuses on the growing regulatory and functional requirements for multi-asset automated trading systems, supporting Fidessa's clients across Europe in meeting these challenges. Christian was previously a Vice President at Deutsche Börse AG, responsible for business development in the institutional equity markets.

Views 573

In true MiFID style

08.04.2016 12:45 pm

The European Commission (EC) has published the first in a series of highly anticipated delegated acts, defining some of the crucial details for MiFID II. Most relevant in yesterday’s document is the unbundling of research and execution fees, where the EC has largely followed the advice given by ESMA back in December 2014. In true MiFID II style, a new acronym is introduced, each side of the argument is given some concessions and the man on the street will doubtless remain as baffled as ever by how entangled the rules governing financial markets have become. It’s like DVC (double volume cap) all over again!

But let’s start at the beginning. Firstly, MiFID II will go ahead with the introduction of the RPA construct (Research Payments Account). Secondly, Article 13(1) clearly states that research is considered an inducement (demand by one side) unless it is paid directly from the buy-side or through an RPA. Interestingly, research is a pretty loaded word in the context of MiFID II and a discussion on that could take up a whole other blog. Thirdly, Article 13(3) seems to imply that CSAs can remain in use (demand by the other side) so long as they meet the RPA requirements.

For any buy-side firm that just doesn’t want to deal with all that added complexity, outsourcing probably looks pretty appealing right now. And as luck would have it, the legislators were thoughtful enough to provide rules around outsourcing of RPAs under Article 13(7). I just wonder how firms will pay for that.

Latest blogs

Thomas Pintelon Capilever

Credit origination - A lot of innovation on the horizon

While consumer credits are becoming more automated and user-friendly to request, all other credits are often still very manual and labor intensive to originate. In this (relatively long) blog I will try to give a description of the (potentially Read more »

Kelly Kearsley Hourly.io

Time Card Theft is a Big Problem. Here's How to Stop It.

Trust is at the core of every employer-employee relationship. You trust your people to do their jobs, and they trust you to compensate them for their work. Most of the time, it works. However, there's always the person looking to bend the rules or Read more »

Daria Afanasyeva UTP Merchant Services Ltd

Cybersecurity – Online payments are getting more secure

Ever since we've been able to buy anything we need with just a click of a button on our laptops or phones, online sales have been consistently increasing each year. Just last year, the total value of UK retail sales was £394 billion, with an average Read more »

James McGivern Cashfac

Keeping Honest Payment Service Institutions Honest

Following the collapse of Wirecard, James McGivern, Head of NBFI at Cashfac, reinforces the need for operational accounting and reconciliation in eMoney and Payment Service Providers The other day an ex-colleague reminded me that we had tried to Read more »

Orion Hindawi Tanium

New Salesforce Partnership and Investment in Tanium Reimagines Employee Service Management in an Increasingly Remote-Working World

We are excited to announce a strategic partnership with Salesforce, supported by a new round of funding led by a strategic investment from Salesforce Ventures to reimagine employee service management, bringing the company’s post-money valuation to $ Read more »

Related Blogs

Steve Grob Fidessa

Anyone for MiFID 3?

I was chatting with the Reg folks here at Fidessa Towers yesterday and the spectre of MiFID 3 came up. Before you all jump off the window ledge there is no official notion of this yet, but when will the regulators feel that their work really is done Read more »

Anne Plested Fidessa

The Clock’s Ticking on MiFID’s Extra Time

As we edge ever-closer to January 2018, the finer details of MiFID II are yet to fully surface, particularly with regard to RTS 22 and the rules around transaction reporting – undeniably one of the larger pieces of the new regulation. There is still Read more »

Magazine
ALL
Free Newsletter Sign-up
+44 (0) 208 819 32 53 +44 (0) 173 261 71 47
Download Our Mobile App
Financial It Youtube channel