For many this will be the last working day of the year. However, the wind down is not quite as widespread as usual, given the proximity to the MiFID II deadline, less than two weeks away. With several new pieces of information coming out in the last days, both generally (see here) and related to commodities and energy (see here) many will have a great deal to do.
For those in energy and commodities, the focus is currently on the position limits and reporting rules. Most of the limits themselves have been released recently (see here). While the rules on position reporting theoretically only apply to those who are investment firms under MiFID II, most have an indirect requirement to report to venues on which they execute trades, as clarified in the recent questions and answers document. This reporting is occupying much time at many market participants.
While some in energy and commodities will have “Investment Firm” status, the majority will make use of an exemption, which in most cases will be the Ancillary Activity exemption found in MiFID II Article 2(1)j and outlined in RTS 20 (see here). Many are making the required notification to National Competent Authorities as also required by that exemption.
Those who are Investment Firms have a great deal to do across many streams (for example, see here). Some temporary relief has been given and reached the news (see for example this article on Ft.com about the delay to the LEI requirement). However many will spend quite some time complying with all of the requirements well into next year. Despite recognition of some third country regimes there is still a battle taking place over recognition of Swiss rules, as reported here on the Reuters site.
The year has thus been dominated by some degree to the run up to MiFID II. Never the less, we have seen several other themes:
On the REMIT front, we have seen an increased focus on making the core parts of the rules work, i.e. the outlawing of market abuse. This is seen both in terms of guidance(see here), and investigations(see here). We have also seen a consultation on changing the reporting formats and many questions and answers documents. MAR has also seen some updates (see here) as well as warnings of increased oversight from regulators (see here).
EMIR saw a change in reporting formats, as specified in the new Regulatory Technical; Standards which commenced on 1st November (see here). The debate around the EMIR review continues (see here). Finfrag, the Swiss version of EMIR, has also seen one go live this year and one coming at the beginning of next (see here).
The topic of Brexit has been below the surface for some time (see here), but we can expect more to become apparent soon. Changes in many other rules, such as the benchmark regulation and SFTR have also been discussed.
We therefore end the year with an imminent go live, and not quite wound down. This blog will continue to provide updates over the holiday period if any occur. And next year we will not only continue to cover all of these topics, but also several new ones, to be announced in our first post of 2018.
We would like to thank all who read this blog for following us, and wish all a happy and hopefully restful holiday season.