Common platform for MiFID and CRD wins support

Industry has broadly welcomed the FSA’s proposal for a single set of high-level rules – the ‘common platform’ – to give effect to the organisational and systems and controls requirement of the Markets in Financial Instruments Directive (MiFID) and the Capital Requirements Directive (CRD). Respondents to CP06/9 agreed that copy-out of the Directives’ provisions in this area was sensible but some also thought that guidance was needed to deal with vague or ambiguous parts of the text. The FSA disagreed and recommends firms instead to discuss concerns with their supervisors. However, it says that it will work with trade bodies on industry guidance. Respondents favouring the common platform accepted that the additional costs implied by super-equivalence, where, for example, a MiFID requirement applied to CRD-only firms, would be negligible. The CRD took effect on 1 January 2007 when relevant changes were made to SYSC chapter 3. These will continue for CRD firms until 1 November 2007 when the chapter will be disapplied for common platform firms, which will become subject to SYSC chapters 4-10. The FSA notes in PS 06/13 that although many firms said they would make the transition before the November deadline, few said that they would do so in January.