Authorisation Process for MiFID Investment Firms
The Central Bank of Ireland is the competent authority in Ireland for the authorisation of Investment Firms, Market operators and Data Reporting Services Providers.
Each potential applicant for authorisation must consider whether its proposed business model:
- Requires authorisation pursuant to the MiFID Regulations;
- Can comply with the MiFID Regulations;
- Can comply with the Central Bank’s requirements and any other financial services law; and
- Is capable of complying with, and adhering to, the requirements that must be satisfied on an ongoing basis.
Having satisfactorily completed this consideration, the potential applicant must review the Central Bank’s “Authorisation Guidance Note on Completing an Application Form for Authorisation as a MiFID Investment Firm” to familiarise themselves with the authorisation process before contacting [email protected] with the requisite information.
Overview of Authorisation Application Process for MiFID Investment Firms
As a first step in the process, (the pre-application stage), the Central Bank will hold a Preliminary Meeting with the applicant. The Preliminary Meeting is an opportunity for the applicant firm to have early engagement with the Central Bank in advance of commencing the application process. The Central Bank welcomes open, transparent and early engagement with applicant firms and at the Preliminary Meeting we will outline the process for applying for an authorisation as an Investment Firm and our key authorisation expectations. The applicant will provide the Central Bank with a high-level overview of its proposals. Applicants should refer to the “Authorisation Guidance Note for MiFID Investment Firm - Preliminary Meeting Pre-Application Presentation” in preparing for the meeting. This Guidance Note outlines the information that we require applicants to cover in their pre-application presentation.
The next step in the process is the submission by the applicant of a Key Facts Document (“KFD”). The KFD provides the Central Bank with high-level information in respect of the applicant MiFID Investment Firm’s proposed business, operational model and associated risks, including details in respect of the applicant firm’s background, ownership, number and type of clients, capital projections, governance and staff resourcing arrangements and outsourcing arrangements. The purpose of the KFD is two-fold: (i) to facilitate the Central Bank in obtaining a clear, high-level understanding of the applicant’s proposed business model, risks and governance arrangements and (ii) to enable the Central Bank to identify, where possible, potentially material issues in respect of the applicant firms’ proposal at an early juncture so that timely feedback may be given to the applicant firm. Please note that while the KFD stage does not constitute the formal assessment (which commences once a Formal Application is submitted), we expect that the applicant firm takes under consideration all items discussed / feedback provided during the Preliminary Meeting with the Central Bank, making any changes necessary to meet the Central Bank’s expectations prior to submitting the KFD. Applicants should refer to the “Authorisation Guidance Note for MiFID Investment Firms - Key Facts Document” when preparing the KFD submission.
At the conclusion of the KFD stage, the Central Bank may invite the applicant firm to submit a Formal Application and may also provide feedback on further elements of the proposal that the Central Bank will require the firm to consider and reflect in the Formal Application; or the Central Bank may provide the applicant firm with feedback on material item(s) which it deems necessary for the firm to consider and address before the Central Bank could be in a position to invite the firm to submit a Formal Application. Where further work is required by an applicant firm to progress to the Formal Application stage, the Central Bank will provide clear and specific feedback to the applicant firm in line with its commitment to providing an open and transparent authorisation process. Applicants should refer to the Central Bank’s “Authorisation Guidance Note for MiFID Investment Firms - Key Facts Document” in preparing to submit a KFD.
The applicant submits a Formal Application for authorisation. The Central Bank welcomes applications where the proposed firm (‘applicant’) can meet the legislative requirements relating to MiFID firms and all other, current, published requirements (including the recommendations and guidance issued by the European Banking Authority and European Securities and Markets Authority (‘ESMA’) which are available on their websites and all new requirements issued by the Central Bank. Applicant Firms are advised to seek legal advice if in any doubt about their scope or application.
The MiFID application forms have been updated to reference the European Union (Markets in Financial Instruments) Regulations (S.I. No. 375 of 2017). All applicants seeking authorisation as a MiFID Investment Firm or amendments to their authorisation should use the form “MiFID Investment Firm Authorisation Application Form”.
MiFID Investment Firms or Market Operators that are currently authorised, or who propose to make an application, to operate an MTF, may make an application to the Central Bank for permission to operate a Distributed Ledger Technology (‘DLT’) Market Infrastructure. Applicants seeking both MiFID authorisation and permission to operate a DLT Market Infrastructure, must submit both applications concurrently. Applications must be submitted electronically to [email protected]
All applicants seeking authorisation as a MiFID Data Reporting Services Provider should use the form “MiFID Application Form – Data Reporting Services Providers"
Important information - ancillary activity exemption under MiFID
From 28/02/22 entities are no longer required to inform the Central Bank when they are using the ancillary activity exemption under Regulation 4(1) (k) of the MiFID Regulations. However it is important to note the Central Bank can request such entities to demonstrate how this activity is ancillary to their main business.
Central Bank of Ireland – Authorisation Forms and Guidance for MiFID Investment Firms
MiFID Investment Firm Authorisation Application Form
Authorisation Guidance Note on Completing an Application Form for Authorisation as a MiFID Investment Firm
Authorisation Guidance Note for MiFID Investment Firm - Preliminary Meeting Pre-Application Presentation
Authorisation Guidance Note for MiFID Investment Firms - Key Facts Document
MiFID II Application Form Data Reporting Services Providers (DRSP)
MiFID Application Form – Data Reporting Services Providers
Authorisation of transparency arrangements for MiFID firms
Waivers from Pre-Trade Transparency
A market operator or investment firm operating a trading venue may apply for the use of waiver from pre-trade transparency requirements in accordance with Articles 4 and 9 of Regulation (EU) No 600/2014 of the European Parliament and of the council (MiFIR).
An investment firm acting as a systematic internaliser may apply for the use of a waiver from pre-trade transparency requirements in accordance with Article 18 (2) of MiFIR.
Firms should contact their supervisor to obtain a copy of relevant application form.
Deferred Publication of Post-Trade Transparency
A market operator or investment firm operating a trading venue may apply for the use of a deferral for the publication of post-trade transparency information in accordance with Articles 7 and 11 of MiFIR.
An investment firm which either on its own account or on behalf of clients, concludes transactions in financial instruments may apply for the use of a deferral for the publication of post-trade transparency information in accordance with Articles 20 and 21 of MiFIR.
Firms should contact their supervisor to obtain a copy of relevant application form.