The FCA has published its near final rules relating to the implementation of MiFID II. The Policy Statement sets out the near final rules in the areas that the FCA consulted on in CP15/43 (where they consulted mostly on markets issues) and CP16/19 (where the main issues consulted on were systems and controls, client assets and commodity position limits). It also covers a small number of issues that were consulted on in CP16/29 and CP16/43 and they also provide an update on their thinking on their proposals for recording of telephone conversations covered in CP16/29.
This Policy Statement affects a wide range of firms that the FCA authorise and recognise, particularly investment banks. Firms affected include:
- interdealer brokers
- firms engaging in algorithmic and high-frequency trading
- trading venues including regulated markets, multilateral trading facilities, and prospective organised trading facilities
- prospective data reporting service providers
- investment managers
- investment advisers
- corporate finance firms and venture capital firms
Firms need to continue with their preparations for the application of MiFID II on 3 January 2018. As noted above, it is particularly important that if firms need to make applications for authorisation or variation of permission linked to the changes in MiFID II that they do so as soon as possible. Firms also need to respond to the FCA’s fifth Consultation Paper (CP17/8) on MiFID II implementation which is being published at the same time as this Policy Statement.
In June, the FCA will publish a second Policy Statement covering the remaining issues such as conduct of business, changes to the scope of the application of the principles for businesses and perimeter guidance, and client asset protections.