The second Markets in Financial Instruments Directive (MiFID II) should not provide any more detailed rules on call for evidence on inducements, costs and charges, according to the Personal Investment Management & Financial Advice Association (PIMFA).
The statement comes in response to the European Securities and Markets Authority’s (ESMA) call for evidence on inducements and costs and charges disclosure requirements under MiFID II.
PIMFA explained that any further detailed rules “would only serve to further confuse consumers, many of whom are less than clear about what the new MIFID II disclosures mean”.
The association have affirmed that instead, if amendments to the MiFID II costs and charges regime are required, “they should be subject to a review process that requires detailed consultation, cost-benefit analysis and consumer testing, while also taking into consideration the industry, consumer and supervisory experience of the operation of the current regime to date”.
Sarah McGuffick, lead regulatory policy adviser at PIMFA, said: “We have made it clear that, if there was to be any hope of MiFID II being applied consistently across the industry, the regulators would need to provide unambiguous and detailed provisions on which firms could base both systems specifications/development.”
She added: “This, in turn, could result in the necessary changes to in-house processes and procedures. The fact that this did not happen has resulted not only in firms incurring huge costs in interpreting and applying regulation but also in their diverting resources away from their most important function, namely the day-to-day servicing of their clients’ needs and wishes.”
