The UK regulator’s perspective on the regulatory change being driven by the AIFMD and MiFID II
The Financial Services Authority’s Director of Conduct Policy, Sheila Nicoll, gave a useful overview of the current state of play on:
- the Alternative Investment Fund Managers Directive (AIFMD); and
- the draft Markets in Financial Instruments Directive II (MiFID)
in a speech on 1 November 2011. Observing that she “cannot promise any great respite” from regulatory change and conceding that the alternative fund management industry is feeling “a lot of regulatory interference”, Ms. Nicoll’s speech covered:
- The most contentious issues in the AIFMD: Depositaries, leverage and third country funds and managers.
- The expected key impacts of the recently-published MiFID II: The extension of the directive to a wider range of instruments and types of trading systems, the broadening and re-categorisation of trading venues, and the extension of the current transparency regime to equity-like and non-equity instruments. We discuss MiFID II in this post.
Ms. Nicoll also referred to the creation of the new structure of UK financial regulation, and noted the key challenge for the new Financial Conduct Authority of tailoring its approach to different parts of the market – where, for example, products that start off in the wholesale market migrate over to the retail market.
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