Quick Answer: What Does MiFID II Cover?

Does MiFID II apply to insurance companies?

Both MiFID II and IDD can be relevant for banks and insurance companies if they either are product providers or distributors of the respective products..

What is MiFID II regulation in simple terms?

What Is MiFID II? MiFID II is a legislative framework instituted by the European Union (EU) to regulate financial markets in the bloc and improve protections for investors. Its aim is to standardize practices across the EU and restore confidence in the industry, especially after the 2008 financial crisis.

What are the MiFID 2 requirements?

MiFID II introduces significant product governance requirements. Investment firms that create products, so called manufacturers, will be required to identify a target market and take reasonable steps to distribute the product.

What is the difference between MiFID and Mifid 2?

In a nutshell, MiFID II increased the requirements from MiFID I on market and research transparency. All trade transactions now have to be reported, and there are increased regulations in place to protect investors better.

What are MiFID activities?

LIST OF investment SERVICES AND ACTIVITIESReception and transmission of orders in relation to one or more financial instrumentsExecution of orders on behalf of clientsUnderwriting of financial instruments and/or placing of financial instruments on a firm commitment basis☐☐☐☐☐☐☐☐☐8 more rows

Is MiFID II working?

One year on, MiFID II is working and firms have adapted to the burdensome new set of rules. … Markets have adapted to the new market structure rules, electronification has increased substantially in certain segments but market liquidity remains an issue.

How does MiFID II affect Equity Research?

The EU’s second Markets in Financial Instruments Directive (MiFID II), introduced in January 2018, requires brokers to charge separate fees for trade execution and for research, thereby ‘unbundling’ them. … Investors pay fund managers a fee in return for management services.

Who is MiFID II applicable to?

MIFID II also applies to European providers of MiFID services in the European Economic Area (EEA)1, such as investment managers of pension funds, European firms which provide MiFID services and to a certain extent credit institutions.

Does MiFID II apply to us?

The short answer, unfortunately, is “it depends”. Many of the new rules under MiFID II may impact US financial firms either directly or indirectly. … At present, MiFID II does not apply to investment managers who purely carry out collective portfolio management of Alternative Investment Funds (“AIF”) and UCITS.

What is the difference between Emir and MiFID?

MiFID II and EMIR share the regulatory coverage of the OTC derivatives market. While MiFID II introduces a trade obligation for OTC derivatives as part of its market structure related measures, EMIR addresses the duty for central clearing. In this case, both regulations complement each other.

What is MiFID in simple terms?

The Markets in Financial Instruments Directive (MiFID) is a European regulation that increases the transparency across the European Union’s financial markets and standardizes the regulatory disclosures required for firms operating in the European Union.

Does MiFID II apply to UK?

MiFID II will need to be transposed into UK law by 3 July 2017, and MiFID II and MiFIR will apply in the UK from 3 January 2018, unless the terms of withdrawal are agreed before that date. … Some of the rules are already in place, and many of the changes have been made at the UK’s behest.

How will MiFID 2 affect asset management?

Fees will come under pressure As MiFID II brings transparency on costs and charges, this in itself will bring competitiveness in the marketplace. On the sell-side, the erosion of mid-tier asset managers will continue. Fees will come under growing pressure. The impact will be felt slowly, but it will be felt.

What are MiFID investment services?

MiFID II applies to investment firms, namely, “any legal person whose regular occupation or business is the provision of one of more investment services to third parties and/or the performance of one or more investment activities on a professional basis.” The relevant investment services and activities are those listed …

Who is subject to MiFID?

“Investment firm” under the Markets in Financial Instruments Directive (MiFID) means “any legal person whose regular occupation or business is the provision of one or more investment services to third parties and/or the performance of one or more investment activities on a professional basis” (Article 4(1)).