ESMA updates Q&As on MiFID II and MiFIR investor protection and intermediaries

On 3 October 2018, the European Securities and Markets Authority (ESMA) updated its Questions and Answers on the implementation of investor protection topics under the Market in Financial Instruments Directive and Regulation (MiFID II/ MiFIR).

The Q&As on MiFID II and MiFIR investor protection and intermediaries topics provides new answers on: 

• Best execution - Reporting for firms using a venue’s RFQ system to agree a trade; and, 
• Investment advice on an independent basis – Use of a ‘look-through’ approach. 

The overall Q&As provide clarifications on the following topics:

• Best execution;
• Suitability and appropriateness;
• Recording of telephone conversations and electronic communications;
• Post-sale reporting;
• Record keeping;
• Investment advice on an independent basis;
• Inducements (research);
• Information on charges and costs;
• Underwriting and placement of a financial instrument;
• Client categorisation;

• Inducements;
• Provision of investment services and activities by third country firms;
• Application of MiFID II after 3 January 2018, including issues of late transposition; and
• Other issues.

The purpose of this Q&A was to promote common supervisory approaches and practices in the application of MiFID II and MiFIR.

ESMA will continue to develop this Q&A on investor protection topics under MiFID II and MiFIR, both adding questions and answers to the topics already covered and introducing new sections for other MiFID II investor protection areas not yet addressed in this Q&A.