On July 21, just one day after the FinanceFeeds Sydney Cup FX industry networking event in Australia, FinanceFeeds, along with TRAction Fintech, hosted its second MiFID II regulatory breakfast symposium at the Four Seasons Hotel in Limassol, Cyprus. Here is a comprehensive insight into what was discussed.
On Friday July 21, at The Four Seasons Hotel in Limassol, Cyprus, the center for the world’s retail FX brokerage business, FinanceFeeds, along with TRAction FinTech, organized a breakfast symposium, beginning at 8.30am until 10.30am, which presented the absolute intricacies of compliance with MiFID II, what will need to be done, and how to most effectively achieve it.
In attendance were a series of very senior FX and multi-asset electronic trading executives and leaders from across the entire spectrum of the retail FX business and their respective service providers.
Organized by FinanceFeeds and hosted in conjunction with Australian OTC trade repository reporting service provider TRAction FinTech, the symposium sought to address a matter that is not often clarified and yet is extremely important in the advent of the impending MiFID II regulatory infrastructure directive which is schedule to be invoked across the European Union in January 2017, that being how every company in the entire business will prepare its technological infrastructure and what the guidelines are in order that they do not fall foul of the increasingly technology-led regulatory authorities.
In Europe, preparation for MiFID II is a major milestone that all FX brokerages, executing venues and electronic trading firms will have to pass, requiring substantial preparation and keeping abreast with technological change.
Introduced by Quinn Perrott, a highly experienced senior FX industry executive and director and co-founder of TRAction FinTech, the symposium commenced with the first subject to be covered by the symposium, that being to analyze the current situation that the OTC derivatives sector is experiencing, and the size of the industry which at $639 trillion per year in notional volume, overshadows absolutely every other form of electronic trading, and has become the bete noire of the regulators.
Mr. Perrott began by setting the scene for an in-depth dialog, within which the attendees participated actively, looking at the arbitrage opportunities among regulators, multi-licensing strategies which use top tier and bottom tier countries in a group, and product intervention risks, BREXIT implications in an enviroment in which regulation will continue to advance as deregulation is very unlikely – Even Donald Trump has been met with a metaphorical brick wall in that respect!
Going into great detail, James Cole, Trade Reporting Officer at TRAction FinTech elaborated on how the regulatory environment has become so infused with technological stipulations as far as brokerage infrastructure is concerned.
Mr Cole pointed out that the comprehension of regulations is subject to a vast differential, that being the gulf between the assets, income and human resources of regulatory authorities globally, compared with that of the institutions which absolutely dwarf those which oversee their activities.
FinanceFeeds will continue to take a close look at MiFID II in order to assist brokerages and compliance officials to prepare for January 2018 when it will be fully implemented.