On 10 February the European Commission proposed amendments to the MiFID 2 package and suggested a delay in its entry into force, initially intended for 3 January 2017. The delay has yet to be approved by the European Council and Parliament, which could also introduce amendments of their own to the Level 1 measures. The move largely reflected ESMA’s difficulties in establishing the data collection and processing systems required by the legislation. AMAFI had raised these concerns with the authorities as early as September 2015.
With the timetable for Level 2 measures already running several months late, it is now public knowledge that the European Commission had asked ESMA to review its proposed standards on secondary trading and position limits on commodity derivatives markets and on the transparency of non-equity instruments.
AMAFI replied to the ESMA consultation launched on 23 December relating to draft guidelines on transaction reporting, record-keeping and clock synchronisation (AMAFI / 16-15).
Work on the reporting issue was carried out together with AFTI. It prompted a request for details on certain transactions exempted from reporting (SFTs, corporate actions), on the information to be provided under different trading scenarios, on the trading capacity parameters and on certain difficulties relating to the reporting of derivatives.
The MiFID 2 Implementation Managers Group set up at the end of 2015 focuses on operational issues arising from the directive. Its aim is to formulate solutions to the main difficulties encountered by financial institutions in their efforts to implement the package; they will then be submitted to the regulators (AMF and ESMA) with a view to the drafting of Level 3 measures (guidelines or Q&A documents).
The Group is currently working on systematic internalisers, market transparency, high-frequency trading and clock synchronisation. In the coming weeks it will also examine best execution and investor protection issues. The consultancy firm Equinox-Cognizant is assisting in this work.
AMAFI continues to work on investor protection issues. It is taking part in a series of meetings with the AMF to discuss ESMA’s efforts on drafting Level 3 measures and to enable the AMF to take account of identified difficulties in its own deliberations.
The themes given priority in this process are the definition of the target market referred to in provisions on product governance, recording of telephone conversations and electronic communications, best execution, investment advice, underwriting and placing.