ESMA has sent a letter to the European Commission raising the timing issue on MiFID II, according to two people briefed on the matter.
The EU’s plans for reforming financial markets face delays amid warnings that regulators and the financial services industry will struggle to develop key information technology systems on time.
Steven Maijoor, Esma’s chairman, is scheduled to discuss progress on the legislation with EU lawmakers at a meeting of a key parliament committee on November 10.
The matter was also discussed at a meeting last week of Esma’s board, which brings together national regulatory chiefs from across the EU, one of the people said.
Esma’s intervention will be welcomed by large parts of the industry, which have already warned that the January 3, 2017 start date of the so-called MiFID II rules is unrealistic for some key aspects of the legislation.
Only 14 months remain before the law takes effect, and implementing rules underpinning its measures are still in flux. Some of the most ambitious parts of the plans, notably the introduction of pre-trade transparency on the bond market, and a system of position limits for trading in commodity derivatives, will require the development of complex systems to ensure compliance.
A spokesman for Esma, while declining to confirm the existence of the letter, said the agency was aware of the challenges posed by the existing timetable.
“Esma recognises the difficulties for all parties — regulators, market participants, infrastructure and also for Esma itself in meeting a number of the IT and data requirements needed ahead of the deadline in the MiFID II legislation,” the spokesman said. [...]
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© Graham Bishop
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