On 29 March 2021, the European Securities and Markets Authority (ESMA) published its advice to the European Commission concerning the application of administrative and criminal sanctions under MiFID II/MiFIR.

The legislative background to the advice is Article 90 of MiFID II which provides that the Commission, after consulting with ESMA, will present a report to the European Parliament and the Council on certain aspects of the functioning of MiFID II and MiFIR. On 23 May 2019, ESMA received a formal request from the Commission to provide technical advice on several technical issues stemming from MiFID II and MiFIR, including certain investor protection topics. The advice now published focuses on the application of the administrative and criminal sanctions under MiFID II and MiFIR. In particular, it covers the need to further harmonise the administrative sanctions set out for infringement of MiFID II / MiFIR requirements.

The advice includes proposals to:

  • Amend the MIFID II requirements for Member State competent authorities (NCAs) to disclose and report information on sanctions and measures.
  • Amend the MIFID II requirement for NCAs to liaise with judicial authorities to gather information on criminal sanctions.
  • Include settlement powers among the range of sanctions and measures of NCAs to increase the efficiency of their enforcement proceedings.
  • Amend the current requirements on MiFID II precautionary measures.

The advice has been submitted to the Commission.