The FCA MiFID II implementation roundtable minutes for 18 April 2016 have been published.
The minutes note that the FCA is planning to publish two further MiFID II implementation consultation papers in July and September 2016. The FCA’s intention is to complete its MiFID II transposition by April next year, in order to give firms sufficient time for implementation.
The remainder of the minutes cover a bespoke session on certain MiFID II conduct of business matters – product governance and the disclosure of costs and charges. The minutes summarise the FCA’s answers to various questions that were posed on these two topics during this roundtable.
In relation to product governance generally the FCA’s existing expectations are set out in the Responsibilities of Product Providers and Distributors for the Fair Treatment of Customers (RPPD) guidance, which includes provisions for both providers and distributors to consider the impact of their actions on their clients in the various stages of the product life-cycle. The FCA believes that the RPPD and other materials set out the FCA’s current expectations for firms to deliver product governance protections. Under MiFID II, there is more detailed and binding rules, limiting some of the current flexibility allowed under the current approach.
The FCA also noted that under MiFID II the requirements for the disclosure of costs and charges information are being strengthened.
The FCA also noted that with the probable delay to the date of MiFID II application to 3 January 2018, there would be a year-long gap from 31 December 2016, when the Packaged Retail and Insurance-based Investments Regulation (PRIIPs) takes effect, where the PRIIPs and MiFID II reporting requirements would not be harmonised. It noted that there would be a further 3 year harmonisation gap, until 31 December 2019, where UCITS will be exempt from the obligations under the PRIIPs key information document and that the Insurance Distribution Directive also includes costs and charges disclosure requirements for insurance-based investments.
The FCA was asked about a possible delay to the application date for PRIIPs. It stated that only the European Commission can table proposals for any delays to the application dates for European legislation.
View FCA MiFID II implementation roundtable minutes (18 April 2016), 10 May 2016