With just over 6 months to go until the start of MiFID II, there is much to do for many. Whilst many energy and commodity traders who intend to use the Ancillary Activity exemption have only some of MiFID II to worry about, Investment Firms have a great deal more to do.
The financial buy side in particular, has been reported as being behind in preparations. This post on the Regtechfs site reports on a survey conducted by JWG which find that 90% of the buy side believe that they are at high or medium risk of not being ready.
In the meantime, ISDA together with the GFMA has issued this letter urging all to obtain Legal Entity Identifiers (LEI). MiFID II requires all entities to be identified by an LEI and there are many clients of investment firms who do not yet have one. The issue is of particular concern to the fixed income industry, as reported here on The Trade News, which highlights the fact that many clients of Investment Firms do not yet have LEIs, especially in Asia.
With so little time left, many would like clarity on the outstanding issues, and also yearn for a period of stability to allow the rules to bed down. For example, this post on the Fidessa web site by Christian Voigt argue for a “freeze” in the requirements of a while so that the industry can get the existing rules working.
Whether we get a freeze or not, it is important for all, including those in energy and commodities, to be as ready as possible. Where there are answers missing, scenarios based preparation is necessary. The where there are to dos, delaying preparation is not advised, especially since as things stand, it does not appear that any deferrals will be forthcoming.