FCA launches financial market reform review
The Financial Conduct Authority (FCA) has announced that it has launched a review of the reform of the country’s financial markets.
More specifically, the regulator will examine potential changes to the rules of conduct and organization of the UK Markets in Financial Instruments Directive (MiFID), with regard to research practices and best execution reports.
The consultation, which opened on April 28, 2021, will affect investment firms and market operators in the UK and will end on June 23, 2021.
Responding to the FCA review, David Corker, a PwC partner, said: “The FCA has launched its review of the UK MiFID II framework. Together with HM Treasury, FCA plans to reform financial markets, focusing on maintaining the highest regulatory standards in a changing market.
“The emphasis is rightly placed on key aspects of the investor protection framework and we welcome the changes – as is the industry, in particular the permanent removal of best execution reports – which has been widely seen as too costly. for companies but with little benefit in the end. -investors. “
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He added: “But the proposals are also another example of a divergence between the UK and the EU. The FCA went further to reduce the compliance burden on best execution, while setting a lower exemption threshold for research on SMEs. The difference in approach can create additional operational and compliance challenges for companies operating in both the UK and the EU.
“This marks the start of a broader work by HM Treasury and the FCA to reform capital market regulation in a post-Brexit world. We expect to see changes soon to the disclosure of costs and fees for wholesale customers and the transparency regime, among others. “