Recently, the FSA has published a "MiFID Presentations and Notifications Guide" where they discuss in some detail what is changing with MiFID and what regulated firm need to do to be up and running by November 1st.
It is a complete change of tone from earlier publication, there is a sense of urgency (as in there is not an unlimited amount of time) and also a clear indication of deadlines for applications and notifications to make sure that business can be conducted under MiFID right from the start. Some of the deadlines to present such notifications or applications are dangerously close. Let's see :
Client Classification 1 - If your firm has a limited permission for Intermediate Customers Only you may need to apply for permission for Retail and Professional Clients since some corporate clients may 'downgrade' to retail following the MiFID rules. If this is the case, the deadline to submit a VOP application is August 1st
Client Classification 2 - Not really included in the guide but to be able to make a judgement call whether you need to apply for a different permission you need to have completed your client classification process (and all the other things that go with it, from conflict of interest to best execution policy).
MiFID exemptions - If you are marginally affected by MiFID or "you do not have a requirement not to hold client money on your permission" (I am quoting the FSA publication !) and wish to rely on article 3 MiFID exemption to fall outside MiFID, you should apply for appropriate standard requirement (by August 1st, 2007)
Passporting and Tied Agents - there are several deadlines around September 30th; however if you want to open a new branch or you want to operate in another territory throgh a tied agent (and be in business on November 1st), your application deadline for passporting is... May 31st !!! (This is because home and host regulators have up to five months to process an application to open a branch)
Systematic Internalisers and MTFs - Should we call this "Anyone for a trading venue ?" . If you want to be a SI you have to apply by August 1st, if you already are an ATS and would like to apply to be an MTF you do not have to do anything, if you are not an ATS you need to apply by... August 1st. On the other hand, if you are an ATS and you DO NOT WISH to be an MTF post November 1st you need to submit a VOP application not later than October 1st, 2007
And there is more.
By now you have noticed a pattern emerging, there is a new deadline August 1st. Two months away !
This is an interesting change of tone, until now the message was a bit bland. Now they clearly state that if you want to be able to do one thing or another on November 1st you need to apply by August 1st.
I am not sure about the practical consequences of this, deadlines for applications are somehow different from deadline for compliance. However it is quite clear that some decisions have to be made by August 1st and it is also quite clear that the FSA clearly indicates that it means business as far as non compliance goes.
I would not be surprised if we see a 'rush to transpose' during the summer and by end of September 2007 the majority of the main markets will have transposed.
What is now clear that the time to sit on the fence is running ou
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