MiFID II - Key Impacts & Considerations. Buy-Side Firms

Transcription

1 MiFID II - Key Impacts & Considerations Buy-Side Firms Breakfast Briefing 13 th June 2017 CCL Limited 2014 Agenda Organisational Requirements Carwyn Evans, Managing Director, Consultancy Services, CCL Compliance Transparency Stuart Holman, Managing Director, Consultancy Services, CCL Compliance Record-Keeping and Reporting Carwyn Evans, Managing Director, Consultancy Services, CCL Compliance Conduct of Business Stuart Holman, Managing Director, Consultancy Services, CCL Compliance Training for Buy-Side Firms Peter Haines, Global Head of GRC, CCL Academy 2 CCL Limited 2014

2 Organisational Requirements Carwyn Evans Managing Director, Consultancy Services, CCL Compliance 3 CCL Limited 2014 Organisational Requirements Conflicts of Interest Remuneration Product Governance Complaints Knowledge & Competence 4 CCL Limited CCL Consultancy Limited

3 Conflicts of Interest Art 23 MII & Arts MiFID Organisational Regulation 565 Increased Focus Identify Conflicts Manage or Prevent Conflicts Clear Disclosure of Conflicts Last Resort 5 CCL Limited 2014 Remuneration Art 23 MII & Arts MiFID Organisational Regulation 565 Management Body Oversight Client s Best Interests Rule Encourage Responsible Business Conduct Performance of Sales Staff Quantitative & Qualitative 6 CCL Limited 2014

4 Product Governance Arts 16(3) & 24(2) MII & Arts 9 & 10 MiFID Delegated Directive End to End Responsibilities Responsibilities of Manufacturers Target Market Assessment Responsibilities of Distributors Review Cycle 7 CCL Limited 2014 Complaints Art 16 MII & Arts 22 & 26 MiFID Organisational Regulation 565 Retail, Professional & Eligible Counterparties Independence Complaints Management Policy Clear & Prompt Complaints Handling 8 CCL Limited 2014

5 Knowledge & Competence Recital 79, Art 25 MII - ESMA Guidelines Recital 79 Retail Clients Allow Staff Sufficient Time & Resources Natural Persons TC Sourcebook Specified Time Periods 9 CCL Limited 2014 Transparency Stuart Holman Managing Director, Consultancy Services, CCL Compliance 10 CCL Limited 2014

6 Transparency Client Categorisation Independent V Restricted Financial Promotions & Past Performance Costs & Charges Risk Disclosures 11 CCL Limited 2014 Client Categorisation Recital 104, Arts 24(5), 30(1)&(2), Annex II & Art 71 MiFID Organisational Regulation 565 Extension of COBS Requirements to ECPs Public Bodies as Per Se Professionals Local Authorities & Opting Up Extension to Non-MiFID Business Cross-Border Business 12 CCL Limited 2014

7 Independent V Restricted Arts 24(4) & (7) MII & Arts 53 & 54 MiFID Organisational Regulation 565 Status Disclosure: Both Retail & Professional Scope of Market Art 53(2) Test Selection Process Impact of Restricted Status? 13 CCL Limited 2014 Financial Promotions & Past Performance Arts 24(3) & 30(1) MII & Art 44(1)-(8) MiFID Organisational Regulation 565 Extension to Non-Retail Clients Fair and Prominent Indication of Risk Likely to Be Understood Comparative Information Past Performance 14 CCL Limited 2014

8 Costs & Charges Art 24(4) & (5) MII & Art 50 & Annex II MiFID Organisational Regulation 565 In Good Time Mandatory Information Comprehensible Form Application to Professional Clients Ex-Ante & Ex-Post 15 CCL Limited 2014 Risk Disclosures Recital 104, Art 24 (4) MII & Recital 64 & 67 & Art 48 MiFID Organisational Regulation 565 Impact of Financial Crises Fair & Balanced In Good Time Nature & Risks Sufficient Detail 16 CCL Limited 2014

9 Record-Keeping and Reporting Carwyn Evans Managing Director, Consultancy Services, CCL Compliance 17 CCL Limited 2014 Record-Keeping and Reporting Transaction Reporting Telephone Recording Periodic Reporting 18 CCL Limited 2014

10 Transaction Reporting Art 26 MiFIR RTS and ITS End of Carve-Out for Portfolio Managers Significant Increase in Reportable Fields Wider Range of Financial Instruments Scope for Broker Reporting/ARMs MiFID Investment Firms Only 19 CCL Limited 2014 Telephone Recording Art 16(7) MII & Art 76 MiFID Organisational Regulation 565 Conversations Relating to/intended to Result in Transactions Written Policy Notify Clients Educate & Train Staff Technology Neutral/Future Proof 20 CCL Limited 2014

11 Periodic Reporting Art 25(6) MII & Arts MiFID Organisational Regulation 565 Portfolio Managers to provide Periodic Statements Fair & Balanced View Mandatory Contents Monthly Quarterly Annual Never 10% Rule 21 CCL Limited 2014 Conduct of Business Stuart Holman Managing Director, Consultancy Services, CCL Compliance 22 CCL Limited 2014

12 Conduct of Business AIFMD Inducements & Use of Dealing Commission Investment Research Suitability & Appropriateness Best Execution 23 CCL Limited 2014 AIFMD Art 6 AIFMD & Arts 15,16 & 24 & 25 MII Art 15 Initial Capital Art 16 Organisational Requirements Art 24 Investor Protection Art 25 Suitability & Appropriateness 24 CCL Limited 2014

13 Inducements & Use of Dealing Commission Art 24(9) MII & Arts 11 & 13 MiFID CDD 593 Inducements & Conflicts of Interest Firm s Own Resources V RPA RPA Operating Conditions EU Brokers: Separate Charges FCA Goldplating 25 CCL Limited CCL Consultancy Limited Investment Research Art 16(3) & 24 (3) MII & Recitals Arts 36 & 37 MiFID Organisational Regulation 565 Conflicts of Interest Independent V Non-Independent/Marketing Communication Market Abuse Directive Financial Analysts Third-Party Research 26 CCL Limited 2014

14 Suitability & Appropriateness Art 25 MII & Arts MiFID Organisational Regulation 565 ESMA Guidelines Suitability: Investment Advice & Portfolio Management Professional Clients Per Se V Elective CBA on Switching Complex or Non Complex Bundled Products 27 CCL Limited 2014 Best Execution Arts 24(1)&(4) & 27 MII & Arts MiFID Organisational Regulation 565 All Reasonable Steps AIFMs Focus on Execution Execution Policy Reporting Quality of Execution 28 CCL Limited 2014

15 MiFID II Training Peter Haines Global Head of GRC, CCL Academy 29 CCL Limited 2014 MiFID II Training Senior management will need to know the main implications Client-facing staff will want to know exactly how the changes will affect them Don t forget support staff The regulators will be interested to hear how you have informed staff of the main changes MiFID II training will come to a crescendo in Q4 30 CCL Limited 2014

16 Questions for the Speakers? Carwyn Evans Managing Director, Consultancy Services, CCL Compliance Stuart Holman Managing Director, Consultancy Services, CCL Compliance Peter Haines Global Head of GRC, CCL Academy 31 CCL Limited 2014 Thank you for attending Click Thank to You edit For Master Attending title style CCL can provide the following support to help your Firm prepare for MiFID II: Face-to-Face Awareness Training In-depth training for Compliance and other control functions elearning Reviews, Guidance & Remediation Documentation CCL C.O.R.E evidential assurance of your MiFID II compliance w: e: w: e: 32 For further information, please contact us on: t e info@cclacademy.com