MiFID II go-live on 3 January 2018 is now less than 4 working weeks away. It is critical to ensure that your firm complies and does so with minimal disruption to the business. Amongst the many obligations for investment firms contained within MiFID II is an enhanced and expanded transaction reporting requirement. We covered preparations for this requirement last month in our article ‘Two months until MiFID II go-live‘, including the need to determine your transaction reporting obligations, ensure clients have obtained LEIs, record natural person identifiers and report CFI or ISIN codes. It is likely that you have undertaken these steps, though if you haven’t, you can talk to us to relieve the pressure. Depending on your mode of reporting, you should now be undertaking the following:
Self-reporting to an ARM
- Complete onboarding with an ARM (it is our understanding that the main ARMs had a deadline of the 30th of November to sign contracts, this has now passed).
- Obtain file specifications from the ARM
- Review field requirements
- Test connections to ensure you can submit files
- Populate files and upload to the ARM in the User Acceptance Testing (UAT) environment
- Review the output file and correct if necessary
Reporting through a third party reporting service provider (using TRAction Fintech procedures)
- Complete onboarding with TRAction including signing legal agreements
- Provide a file sample or access to data (for automated data transfer)
- Work with the onboarding team to ensure that the data is in the correct format
- Finalise submission procedures
Analyse business impacts
Analysing operational impacts of compliance efforts is paramount to achieving minimal disruption. You should be determining the resources (financial, people, technology) required for ongoing compliance and allocate sufficient resources to the task. The staff involved should focus on iteratively improving procedures during the first few months and also monitor developments in regulator approaches.
MiFID II/MiFIR Readiness Checklist
Determine your reporting obligations
Ensure corporate clients have LEIs
Compile natural person identifiers for other clients
Obtain ISIN and CFI codes
Decide whether to report directly to an ARM or through a third party reporting solution
Undertake testing with the ARM/ third party reporting solution
Analyse business impacts and allocate resources accordingly
If you would like to discuss the above or learn how you can become MiFID II-ready, get in touch with TRAction Fintech on +44 20 8050 1317.