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Over 60% of respondents to a quarterly poll of 400 investment firms indicated that their preparations for the impending European trading Directive still required some work, despite the rapidly approaching November deadline.
The European Commission yesterday instituted infringement charges against 24 EU member states that have yet to transpose the Directive into national law, amid fears that the delays are hampering industry preparations.
Sixty-three per cent of those surveyed by SunGard believe that, even if other EU countries failed to meet the November deadline, those countries that were on track should not delay their own implementations. Forty-six percent also expressed concern that their own regulators would add further complexity to MiFID through the imposition of national laws and additional guidance.
Carl James, head of portfolio services for Henderson Global Investors says: 'There is a feeling from some people within the UK that there are some countries that probably will not be ready by November and maybe they are thinking to themselves 'that it doesn't apply to us'. I am sure it will eventually but perhaps after the November 2007 deadline.'
Key challenges for industry participants include requirements for record-keeping and providing and proving best execution.
Over 65% of respondents indicated that they would either struggle to handle the new record-keeping requirements proposed by the CESR (Committee of European Securities Regulators), or that they were unable as yet to ascertain the impact of these proposals.
Best execution is proving equally difficult to resolve. Only 23% of firms believe they will know how to ensure best execution by the end of April, reports SunGard, with most (62%) estimating an August/September timeline. Over 70% of firms expect to use 'post-trade statistical analysis' to ensure best execution, with over 45% expecting to do pre-trade analysis and more than 40% to use manual reviews.