EBF response to CESR consultation on MiFID Level 3

15 January 2007

The EBF issued its response to the CESR consultation on MiFID Level 3: Use of Reference data standard codes in transaction reporting. The Banking Federation is concerned on the questions to which authority the transaction ought to be reported. The bank would have to differentiate between which supervisor receives the report, home or host, according to the location of the client.

The EBF believes that the current situation would not facilitate supervisory convergence per se and/or contribute positively to fulfilling the aims of MiFID.

Also, the current situation as foreseen by reading the CESR consultation paper on passporting would lead to a high default rate which is to the detriment of an efficient industry and an appropriately protected consumer alike.

Finally, the costs of establishing a system where by banks would have to report on a differential basis according to the location of the client would in no way, we feel, be matched by any realisable benefits.

The EBF believes that banks should only be required to report once to the supervisory authority in which the branch is physically located. These are issues that we will also elaborate on in our response to CESR’s consultation on the passport under MiFID.

In the absence of a clear pan-European interpretation of who should be obliged to make a transaction report firms should find themselves in compliance with MiFID where only the executor of the transaction makes the report, EBF states.

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