The implementation date for Mifid II (3 January) is rapidly approaching, with seasonal celebrations reducing preparation time further. Now is the time to conduct a self-assessment to establish your firm’s state of readiness.
Mifid II affects investment advice and discretionary management firms differently, so your actions will be tailored to your firm type. In addition, advice firms that are “Article 3 exempt” enjoy less stringent obligations, or exemptions in some areas.
So, considering the key areas impacted by Mifid II, how do you assess your firms’ readiness in the following areas?
|Ready||Nearly ready||Not started|
|Legal entity identifier application|
|Suitability; periodic suitability assessments|
|Recording client communications|
|Aggregated disclosure of costs and charges|
|Structured deposit permissions|
|Conflicts of interest|
|DFMs: Quarterly reporting and 10 per cent portfolio losses|
If you want to achieve some quick successes, look at structured deposit permissions and the possible need for a legal entity identifier. Once your firm’s approach to these is decided, it is straightforward to make an application.
Some of the changes build on existing principles but there is significant preparatory work to be done. Aside from the quick fixes mentioned above, preparing your disclosure documentation, assessing your firm’s requirements regarding recording of client communications and organising product governance arrangements should be priorities.
Russell Facer is managing director of Threesixty