MiFID II – updated Q&A on market structures and transparency and supervisory briefing

ESMA updated its Q&As on market structures and transparency topics on 14 November. The new Q&As provide clarification on the following topics:

• Making data available free of charge 15 minutes after publication (amendment to an existing Q&A); 
• Obligations applicable to systematic internalisers in non-traded on a trading venue financial instruments;
• Definition of request for quote (“RFQ”) systems;
• Pre-trade transparency in RFQ systems;
• Concept of comparable size in market making agreements and voluntary provision of liquidity.

Read: The Q&A are available here and here

Read: The associated press release 

ESMA published a supervisory briefing on assessing suitability under MiFID II on 13 November. The briefing is meant to give market participants indications of compliant implementation of the MiFID II suitability provisions and covers the following topics: 

• Determining situations where the suitability assessment is required;
• Information to clients about the purpose of the suitability assessment;
• Obtaining information from clients;
• Arrangements necessary to understand investment products;
• Arrangements necessary to understand the suitability of an investment;
• Suitability report;
• Qualifications of firm staff; and
• Record keeping.

Read: The briefing

Read: The associated press release

Other – clearing in the event of no-deal Brexit, short selling regulation Q&A and binary options ban

ESMA released a public statement on its proposals for managing risks of a no-deal Brexit in the area of central clearing on 23 November. 

The public statement confirms that ESMA is engaging with the European Commission to plan, as far as possible, preparatory actions for the recognition process of UK CCPs to permit ongoing central clearing of derivatives, in case of a no-deal Brexit.

Read: The statement 

Read: The associated press release 

ESMA updated its Q&As on the short selling regulation and on certain aspects of credit default swaps on 14 November.

The Q&As clarify that identification of the relevant competent authority, following entry into application of MiFID II/MiFIR, is no longer made under Commission Regulation No 1287/2006 but under Commission Delegated Regulation (EU) 2017/590 for the reporting of transactions to competent authorities.

Read: The Q&As 

Read: The associated press release

ESMA updated its Q&As on temporary product intervention measures on the marketing, distribution or sale of CFDs and binary options to retail clients on 9 November.

The updated Q&As provide clarification on the application of temporary product intervention measures in relation to the prominence of the risk warning and further clarify what are considered “payments” for the purpose of entering into a CFD.

Read: The Q&As 

Read: The associated press release 

On 9 November, ESMA renewed its prohibitions of marketing, distribution or sale of binary options to retail clients for a further three months from 2 January 2019. 

Read: The ban