This proposal concerns extending the transposition deadline for Member States and the compliance date for regulated firms of Directive 2004/39/EC on Market in Financial Instruments ( MiFID). This is because serious difficulties have been reported by industry and Member States in relation to the ability of regulated entities to comply with the current deadline for transposition of the Directive (30 April 2006).
1. Adoption of implementing measures in practice shortens transposition period
The transposition deadline agreed in Council and by the European Parliament was the standard 24 months after the entry into force of the directive. However, a significant part of that transposition period will be taken up by the preparation of the necessary implementing measures for 17 provisions of the directive, which cannot be effective without such measures. Under current planning, the Commission expects to have adopted the complete set of implementing measures by the beginning of 2006. The adoption of these measures cannot be accelerated both because of their complexity, the need to consult widely and building consensus as well as because the process must be carried out in accordance with the comitology procedure specified in Decision 1999/468/EC. Transposition of those provisions of the Directive which are linked to implementing measures cannot proceed until the concomitant implementing measures have been finalised. In fact, this delay in turn affects the timely transposition of other provisions of the Directive related to the provisions that require implementing measures. As a result, Member States will not have sufficient time to complete the transposition of the entire Directive in the period between the expected adoption of the implementing measures (beginning 2006) and the current transposition deadline (April 2006). Therefore in order to ensure the effective and uniform implementation of the MIFID in all Member States from the transposition deadline, it is appropriate to postpone that deadline.
2. Practical implications for the firms
The Commission services have been informed by a wide range of industry participants that the current MIFID implementing timetable imposes impossible deadlines for the entities within its scope. These contend that compliance with the MIFID may require significant time consuming modifications to their technological infrastructure, IT software, record-keeping and reporting systems. In addition, firms may have to adapt internal policies and guidelines concerning client relations, the segregation of assets, and the management of conflicts of interest. Moreover, market participants claim not to be able to make definitive decisions as to what operational steps will be needed until implementing measures are finally adopted. Directive 2004/39/EC only sets general principles with respect to these requirements; the precise technical details will be provided for in the implementing legislation which will not be available until year end.
Source: commission proposal
II. General Information
Directive 2006/31/EC of the European Parliament and of the Council of 5 April 2006 amending directive 2004/39/EC on markets in financial instruments, as regards certain deadlines
- O.J. EC No L (Legislation), Edition 114, Year 2006, p.60
- Regular Act
- Legal Basis
- Art. 47 EC
- Legislative Procedure
- Codecision procedure
III. Versions and Legislative History
2. Legislative History
O.J. EC No. C, Ausgabe 286E, Jahr 2006, p. 196
O.J. EC No. C, Ausgabe 323, Jahr 2005, p. 31
COM(2005) 253 endgültig