The Securities and Markets Stakeholder Group (SMSG) is a group comprising of academics and industry participants which seeks to help facilitate consultation by the European Securities and Markets Authority (ESMA).
The SMSG has published its advice to ESMA on recent issues set out in its consultation paper and discussion paper concerning implementing measures for MiFID II and MiFIR. The advice covers the following topics:
- trading venues aspects of the consultation paper;
- transparency and trading obligations aspects of the consultation paper and discussion paper;
- transparency for the trading of non-equity instruments; and
- investor protection aspects of the CP.
The advice on investor protection aspects is by far the longest of the papers and includes the following points:
- that the political compromise at the framework level did not imply a de facto ban on inducements in the context of non-independent advice. The SMSG understands that this is also ESMA’s view but this is not clear from the CP; and
- there is a major issue with ESMA labelling investment research as an inducement as this will lead to a de facto ban. The SMSG believes that this could have adverse severe consequences on research on SMEs which MiFID II aims at the same time to support. The SMSG strongly advises ESMA to reconsider their stance by deleting the paragraph to investment research.
View Trading venues aspects of the consultation paper on MiFID II and MiFIR, 15 August 2014
View Transparency for the trading of non-equity instruments, 18 August 2014
View Investor protection aspects of the consultation paper on MiFID II and MiFIR, 8 August 2014