The European Commission is considering delaying the MiFID II package by one year to 2018 after EU finance authority ESMA said elements of the financial markets overhaul may not be ready in time.
A delay is needed “if we want to have a smooth” implementation, Martin Merlin, the Commission’s director for financial markets told the EU parliament’s economic affairs committee on Tuesday.
ESMA chair Steven Maijoor told the committee that the Jan. 2017 start date would be too tight for companies to build the required IT infrastructure to comply given that technical rules would not themselves be finalised until the middle of next year.
EU finance authority ESMA last month released its final version of MiFID II rules to further regulate commodity trade including carbon in an effort to guard against market abuse.
The European Commission has three months to scrutinise the proposal and the EU Parliament are given an additional month to pass judgement.
Aspects of MiFID II will affect all companies dealing in commodities markets, regardless of whether they require a license, and financial institutions and trading platforms in particular face taking considerable steps to comply.
Some policy watchers had already pointed out that deadlines seemed impossible to effectively meet.
EU trading data required by companies to decide whether to obtain a MiFID licence would be available too late to meet a July 3, 2016 application deadline, according to Benoit Gourisse of the International Swaps and Derivatives Association.
“No one has complete EU trading data, and they are unlikely to get it until the third quarter of 2016, giving very little time to decide if they need (a license)” he told the Energy Trading Operations and Technology (ETOT) Summit in London last week.
By Ben Garside – firstname.lastname@example.org