MiFID II stocktake: where are we now?

Though the performance of MiFID II is already under review by European institutions, many financial services firms are still grappling to comply with this mammoth implementation project. Yasin Sridhar assesses the regime in practice so far.

Yasin Sridhar is regulatory director at Konexo, a consulting and resourcing division of law firm Eversheds Sutherland. Contact him on yasinsridhar@konexoglobal.com.

It has been over two years since the second instalment of the Markets in Financial Instruments Directive (MiFID) came into effect, posing the largest wholesale change to financial services regulation in the European Union since the original MiFID. MiFID II, comprising a directive (MiFID II) and the Markets in Financial Instruments Regulation (MiFIR), is aimed at building investor protection, improving reporting of trade information to regulators, regulating new market structures, and requiring firmer governance around product creation and company organisation following the global financial crisis. The combined effect of these regulatory measures is designed to improve oversight from European regulators and the behaviour of investment firms, to avoid another financial crisis as well as to keep up with technology’s impact on financial markets. These lofty ambitions are backed by thousands of pages of regulatory measures, spanning directives, regulations, delegated regulations, and European Securities and Markets Authority (ESMA) Q&A. This stocktake examines critical changes brought by MiFID II, their impact on the market, and how firms are managing to comply with these changes, with a focus on its operation in the United Kingdom.