On 5th June, ESMA published the final guidelines on the MiFID II compliance function. These guidelines replace the ESMA guidelines on the same topic issued in 2012, and include updates that enhance clarity and foster greater convergence in the implementation, and supervision, of the new MiFID II compliance function requirements.
The obligations of the compliance function have been further strengthened, broadened, and made more exacting under MiFID II.
The final guidelines are intended to enhance the value of existing standards by providing additional clarifications on certain specific topics, such as new responsibilities in relation to MiFID II’s product governance requirements, and by including greater details on the reporting obligations of the compliance function.
Otherwise, the objectives of the compliance function as well as the key principles underpinning the regulatory requirements it must adhere to have remained unchanged.
The guidelines are intended for use by investment firms and credit institutions providing investment services and activities, investment firms and credit institutions selling or advising clients in relation to structured deposits, UCITS management companies and external Alternative Investment Fund Managers (AIFMs) when providing investment services and activities in accordance with the UCITS Directive and the AIFMD.
The final guidelines will now be translated into all the official languages of the EU. This will trigger a two-month period during which NCAs must notify ESMA whether they comply or intend to comply with the guidelines.
We produced an Insights article on certain features of the proposed guidelines back in August 2019 at the public consultation stage. Readers may want to refer to this article as a ‘refresher’ on the main issues and on our opinions.
Please contact our Compliance Help Desk if you require further information about how deltaconX can help you interpret and comply with the ESMA Guidelines.