James Maycock, risk consulting director at KPMG, comments in response to the European Securities and Markets Authority (ESMA)’s publication of its final technical standards for the Markets in Financial Instruments Directive (MiFID II)
“The introduction of MiFID II is arguably the biggest change to Europe’s energy markets since liberalisation in the 90s, potentially bringing energy firms into a regulatory regime similar to that faced by the financial sector.
“We say 'potentially' as there are exemptions. The key question for energy organisations is whether they will come under the authorisation regime or not. A vast amount of process change and potentially large costs depend on that outcome.
“While we now have clarity on how these exemptions will be tested, a number of key elements remain unclear, in particular how the authorities will determine the relevant markets and market share.
“The regime starts in January 2017 but the first assessment will require firms to collect and analyse data for the year to 30 June 2016. This means that in some cases firms will face extremely demanding timeframes in meeting their implementation obligations."
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