The European Securities and Markets Authority (ESMA) has released the official translations for its MiFID II suitability requirements.
Translations of the report have been issued, supporting all of the official EU languages. These translations have come two months after the guidelines where initially publihsed by the ESMA.
The report is designed to help competent authorities and firms to help address the regulatory requirements for investment advice and portfolio management within MiFID II, which launched earlier this year.
Principally, the guidelines address situations where services are provided to retail clients, but also some instances with professional clients.
Now all of the translations have been released, the necessary competent authorities will have two months to inform the ESMA whether they comply or intend to comply with the guidelines expressed through the report. If they will not be meeting compliance, they must state their reasoning and where they fail to meet this compliance.
Firms on the other hand, are not required to report to the ESMA on whether they meet the guidelines. The term ‘firms’ includes investment firms, credit institutions, UCITS management companies and external alternative investment fund managers.
ESMA has released the document to help clarify the application of various aspects of MiFID II and ensure there is ‘common, uniform and consistent’ application of the regulation.
The guidelines state, “ESMA expects these guidelines to promote greater convergence in the interpretation of, and supervisory approaches to, the MiFID II suitability requirements, by emphasising a number of important issues, and thereby enhancing the value of existing standards. By helping to ensure that firms comply with regulatory standards, ESMA anticipates a corresponding strengthening of investor protection.”
Earlier in the year, the body launched its Supervisory Convergence Work Programme (SCWP) for 2018, which outlined MiFID II support as a key priority.
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