AFME Guide to MiFIR/MiFID II Reforms


On Oct. 24, AFME issued guide for wholesale secondary market firms.


  • AFME and Linklaters issued the MiFIR/MiFID II reforms in the EU and the UK: Implementation Guide for firms operating in wholesale secondary markets.
  • Follows ESMA Jul. 2024, consult, firms MiFID II order execution policies, see #219595.
  • Follows UK FCA Jul. 2024, proposals to build up UK wholesale markets, see #220892.
  • Follows EU CNCL Jun. 2023, agreed negotiating mandate, listing act, see #176061.
  • MiFIR and MiFID II
  • In relation to MiFIR, ESMA has issued numerous sets of consultation packages to begin work on the draft technical standards stemming from mandates in Level 1.
  • UK FCA has been delivering UK Treasury's Wholesale Markets Review through a structured approach and targeted consultations, which is still an ongoing process.
  • At the same time, the EU and UK have launched initiatives to review essential MiFID investment research rules as per EU Listing Act and UK Investment Research Review.
  • These respective reviews share the similar aim of bolstering EU and UK capital markets through a revised framework for the investment research ecosystem.
  • While some reforms have crystallized, many parts of rulebooks are still pending and being revised, so regulatory agenda for secondary capital markets remain very busy.
  • It is anticipated that the regulatory agenda will remain busy for next 12 months.
  • AFME's MiFID Implementation Guide provides a holistic yet detailed overview of the statuses and key implementation pain points for AFME's members.
  • Specifically which are sell-side firms operating in wholesale secondary markets.
  • Guide covers regulatory developments up until Oct. 1, 2024, and will be reviewed on a regular basis until end of 2025 by AFME accordingly on progress of implementation.
  • Topics in the guide include market structure, transparency, market data, consolidated tape providers, investment research, and the execution of client orders.
  • Execution of Client Orders
  • As an example of changes in client orders execution EU technical standards are being introduced with enhanced requirements in respect of firms' order execution policies.
  • If finalized as proposed, firms would need to implement more prescriptive processes around their order execution policies, including monitoring and regular reviews.
  • Draft proposals are due to be finalized and submitted to EU CMSH by Dec. 29, 2024.
  • AFME believe that client order proposals are likely to apply from Sep. 29, 2025.

Regulators AFME
Entity Types B/D; IA; Inv Co
Reference Rp, PR 10/24/2024; MIFID/MIFIR Dir 2014/65, Reg 600/2014;
Functions Compliance; C-Suite; Financial; Legal; Operations; Reporting; Risk; Trade Reporting; Trading; Treasury
Countries European Union; United Kingdom
Category Trade Association
State
Products Derivatives; Equity; Fund Mgt; Securities; Structured Products
Regions EMEA
Rule Type Guidance
Rule Date 10/24/2024
Effective Date 10/24/2024
Rule Id 231066
Linked to N/A
Reg. Last Update 10/24/2024
Report Section EU

Last substantive update on 10/29/2024