The European Commission has nearly completed work on the regulatory technical standards needed for the implementation of the Markets in Financial Instruments Directive II, its comprehensive overhaul of market regulation. Nearly all of the RTS were published before the summer break, with several more due in September.
Certain details are still in discussion with lawmakers in the European Parliament, however. For example, RTS 21, which establishes the framework for position limits on commodity derivatives, is a matter of particular interest for certain members of the European Parliament.
During a hearing of the Committee on Economic and Monetary Affairs, Sven Giegold, a Member of Parliament from Germany's Green Party, said the Commission was not taking into account concerns raised by members of Parliament, and invited the new Commissioner for Financial Services, Valdis Dombrovskis, to meet with the European Parliament’s MiFID negotiating team. Dombrovskis responded that the Commission shares the MEPs’ objective of preventing speculation on sensitive commodities such as food, and assured the lawmakers that he was open to discussing these issues in more depth.
The next step is for national authorities in EU member jurisdictions to transpose these standards into national law. The U.K. Financial Conduct Authority has already begun this process, and in July it published its second consultation paper on MiFID implementation in the U.K. The paper focuses on a range of issues including position limits and reporting for commodity derivatives, systems and controls requirements for firms providing MiFID investment services, and with fees and client asset protections. The FCA will gather feedback until the end of October and intends to publish its rules in the first half of 2017. FCA officials have stressed that until the U.K. formally exits Europe, firms in the U.K. must continue to comply with EU directives such as MiFID II and the associated rules.
