Firms Late With Mifid Paperwork Need Emergency Plans, Says Fca


Mifid II introduces new rules for investment firms, advisers and DFMs in the UK; including the need to record telephone conversations with clients.

From 3 January 2018, some firms will only be able to operate if they have the required regulatory permissions from the FCA.

The FCA says companies will face civil, regulatory or even criminal consequences if they continue to trade without authorisation after failing to apply for waivers in time.

To ensure that the applications could be processed in time for the January 2018 deadline, the regulator gave firms a 3 July deadline to submit applications for authorisation or to vary their permissions.

The watchdog is now urging firms to crack on with putting together their requests as soon as possible.

“We expect any firms who have not submitted a complete application by 3 July 2017 to do so without further delay,” the FCA said.

Contingency plans

The regulator added that, although it will review complete applications received after 3 July within six months, it cannot guarantee to do so by 3 January 2018.

“Such firms will therefore also need to have contingency plans in the event that by 3 January 2018 they do not have the required permissions,” it said.

The FCA confirmed it is currently reviewing the applications it has already received.


The regulator warned that there will be consequences for firms that undertake regulated activities without the required permissions, including civil, regulatory and/or criminal prosecution.

The FCA has “various powers that it can use to safeguard the orderly operation of markets and to ensure that firms carry on activities in accordance with regulatory requirements”, the watchdog said.

“Where we become aware of firms carrying on regulated activities without the required permissions, we may take such action as we consider appropriate.”

Mifid II

The Markets in Financial Instruments Directive (Mifid) contains a set of reforms designed to encourage competition between Europe’s financial operators and investment services providers.

The overarching aims of Mifid II are to strengthen investor protection, increase the efficiency of financial markets and reduce unnecessary costs for participants.

The FCA’s new Mifid II rules, which will apply from 3 January 2018, exhaustively touch on areas like suitability, client reporting and product governance.

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