The market still awaits the final version of Regulatory Technical Standard 20 of MiFID II, which contains the rules around the “Ancillary activity test”. This determines whether energy and commodity market participants will lose their exemption under MiFID and be required to create a “regulated entity”, which would need to comply with the majority of the MiFID II rules.
The latest draft of RTS 20 was issued by ESMA in May. However the question regarding whether to re introduce a “capital test” was not addressed by ESMA who instead asked the European Commission to rule on the issue. The opinion document which accompanied the latest draft gave several options for the Commission to consider , but did not state whether the test should be re-included.
This article on the ICIS Regulation Portal provides news that the next draft of the RTS is unlikely to be issued before September. Despite the start of MiFID II now being delayed by a year to 3 January 2018, a late issue of the document will create problems for market participants, since time for creating the regulated entity will be shortened. The article considers whether this wait will lead to a further delay to the start of MiFID II. Given the comments from ESMA mentioned in the article, and the lengthy delay process, an overall delay is unlikely. Most will therefore be hoping for finality soon.