The European financial markets are preparing to undergo a complete remodelling of their organisational system. In January 2018, MiFID II will officially become an active part in redefining the overall structure of the entire industry by applying new legislation intended to regulate and improve the financial and investment services.
MiFID II: Aim and Opportunity
The Markets in Financial Instruments Directive (MiFID) applies to the European financial markets and aims to increase supervision, efficiency, market and information transparency and investor protection. The MiFID II regulation is a revised and more demanding version of the original framework, introduced in November 2007. MiFID II is designed to improve each of these aspects while creating a secure and systematic environment for all financial activity.
Despite the challenges, many view the recent changes as an opportunity to reassure investors and regain their trust. These changes will enable companies to provide their clients with high-quality products and to raise the standards of professionalism in the industry.
Anticipation, impact and preparation
El impacto de la nueva regulación tendrá implicaciones en diferentes áreas, buscando un mercado más seguro, más transparente y más equilibrado. Como consecuencia, el impacto se extenderá hacia los mercados financieros globales, afectando particularmente a aquellas organizaciones en contacto directo con los mercados europeos.
While the changes will affect different areas, they seek to create a safer, more transparent and evenly balanced marketplace. In turn, this will impact the global financial markets, in particular, those organisations in the European markets.
Due to these upcoming changes, firms in the financial markets are reviewing the service offered to their clients and adapting this to the new legislation.These changes are wide-ranging and will impact investment banks, asset managers, commodity firms, brokers, and dealers among others.
Business Model Impacts
Firms business models, especially investment services focusing on service compensation will now become chargeable with the receipt of third-party incentives being reduced or stopped altogether.
Operational and Organisational Impacts
The regulation requires firms to provide all of the information and to ensure that they have structured management who are in control of their systems and controls.
MiFID II requires financial firms to adapt their IT system. This legislation requires companies to integrate financial assessment solutions in their organisation. This will be achieved using more recent, more advanced technology.
Finding the right solution is often the biggest challenge. TechRules have many years of experience in implementing compliance solutions in the wealth industry. These solutions are “built” using Tower and use both web and mobile applications. In addition to Tower, TechRules provides API licensing.