12 October 2005

FBE comments on latest draft proposals on MiFID

The European Banking Federation (FBE) issued its response to the latest draft proposals for implementing measures of the Markets in Financial Instruments Directive (MiFID) criticizing that the deletion of the requirement for firms to have to report client identity to the authorities on an automatic basis has come back in “rev4” as an option for competent authorities. FBE is of the opinion that the Level 1 of MIFID does not require such reporting. An automatic reporting of this information on all transactions, even if it were merely kept as an option for the Member States, would go against the Level 1 guidance of the Directive. At a practical level, it would inundate the authorities with information they cannot use and lead to excessive increases in the cost of reporting by the firm, which would be passed on to clients, creating a substantial burden especially on retail clients. Moreover, such reporting might also clash with the banking secrecy rules existing in some Member States.

Voice of the European banking sector
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