The European Commission has proposed a one-year extension to the implementation of the revised Markets in Financial Instruments Directive, MiFID II. The Commission says the delay is to take account of the exceptional technical implementation challenges faced by regulators and market participants, and shouted from the rooftops at each and every opportunity. The new deadline is January 3 2018 (compared with January 3 2017).
The Commission says the reason lies in the complex technical infrastructure that needs to be set up for the MiFID II package to work effectively. The European Securities and Markets Authority (ESMA) has to collect data from about 300 trading venues on about 15 million financial instruments and the original deadline has been deemed simply unworkable.
Jonathan Hill, Commissioner for Financial Services, Financial Stability and Capital Markets Union said: “Given the complexity of the technical challenges highlighted by ESMA, it makes sense to extend the deadline for MiFID II. We will therefore give people another year to prepare properly and make the necessary changes to their systems. Meanwhile, we are pressing ahead with the level II legislation to implement MiFID II and expect to announce those measures shortly.”
This extension will not have an impact on the timeline for adoption of the ‘level II’ implementing measures under MiFID II/MiFIR. The European Commission will proceed with their adoption irrespective of the new date of entry into application of MiFID II. This will provide legal certainty for the new provisions.
A period of 30 months between the adoption and the entry of application of MiFID II had already been foreseen to take account of the very high level of complexity of the package. The extension of the deadline is strictly limited to what is necessary to allow the technical implementation work to be finalised.