What is MiFID ll?
The Markets in Financial Instruments Directive commonly known as MiFID ll, is due to come into force in January 2018. First introduced by the EU due to the 2008 financial crisis, MiFID is set to reform the financial industry in-order to prevent history repeating itself.
Replacing the original Directive January 2018, MiFID ll brings changes t many areas relating to conduct in business with more robust rules around recording and storing conversations.
MiFID ll - Who needs to comply?
Under today's MiFID regulations
Organisations involved directly in trading must record conversations. However some are exempt such as financial advisers and brokers as long as they don't operate across borders or hold Client money.
Under the new MiFID ll regulations
Any organisations providing financial services to Clients linked to "financial instruments" will have to record and store ALL communications intended to lead to a transaction. Unlike the current FCA regulations which are specific to those directly involved in financial trading. With MiFID ll any organisation that's simply gives advice may lead to a trade or investments will need to comply with this rule.
MiFID ll - What needs to be recorded?
Under today's regulations
The FCA mandates that fixed line and mobile calls must be recorded.
Under the new MiFID ll regulation
The new requirements stipulate conversations that are intended to lead to a transaction must be recorded. MiFID ll includes other communications such as mail, fax, email or audio recording of Client orders placed during face-to-face meetings that are intended to result in trade.
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