The implementation of Mifid II regulation could be delayed by a year, after a senior European official raised concerns about the timeline.
The current deadline for implementation of the regulation is January 2017, but concerns have been raised that the deadline is too close for firms to implement the necessary technology and system changes.
Martin Merlin, a senior European Commission official, told the European Parliament’s economic affairs committee, that a year delay would help implementation, reports Reuters.
“If we want to have a smooth and effective implementation … we will need to decide what the scope and duration for that delay should be,” Merlin said. “The simplest and most legally sound approach would be to delay the whole package by one year.”
His comments are backed up by Steven Maijoor, chairman of the European Securities and Markets Authority, who previously said a delay may be needed to ensure firms could get IT systems in place.
Michael McKee, partner at law firm DLA Piper, has backed any potential delay.
“Delaying the implementation date for MIFID II would be a welcome recognition of the fact that it will not be practicable for much of the technology and reporting to be put in place by 3 January 2017, particularly given that neither the [regulatory technical standards], nor the implementing measures at EU level are yet finalised,” he says.
Industry body the Investment Association has already called for a delay to the Mifid II implementation to January 2018 to “give sufficient time for market infrastructure to develop”.
Speaking at the FCA’s Mifid II conference last month, FCA director of markets policy and international David Lawton said: “The ultimate deadline of January 2017 is universally recognised as challenging. For everyone. Regulators included.”