FCA reveals only a handful of firms met Mifid application deadline

Hourglass-Deadline-Time-Clock-700.jpgThe FCA has revealed that only a handful of investment managers applied for Mifid II authorisations by the 3 July deadline.

Responding to a Freedom of Information request, the regulator said five firms submitted applications by the cut-off point while a further firm made a late submission that was accepted.

The FCA pointed out that it didn’t consider this a late submission as the deadline was for firms to have a guaranteed response by 3 January, when the Mifid II rules kick in.

The FCA announced in January this year that for investments firms applying for authorisation or a variation of permission, 3 July is “the final deadline for submitting a complete application…we encourage firms to apply well in advance to increase the chance of obtaining the relevant permissions by 3 January 2018”.

Firms have been able to submit draft authorisation and variations of permission applications since 30 January.

In September FCA enforcement and market oversight executive director Mark Steward said it will consider enforcement action against firms that have “deliberately flouted” the Mifid II requirements.

At a speech at the AFME European Compliance and Legal Conference, Steward said the FCA will not take enforcement action against firms that do not meet all Mifid II requirements by the day it comes into force where they can show they have taken steps to comply with the regulation.

However, he added: “At the same time, we cannot create a floor for compliance below the required Mifid II standards and so our disposition is likely to be different where firms have made no real or genuine attempt to be ready or where key obligations are deliberately flouted.”

Last week Carl Wallis, head of compliance at Bankhall, warned that investment intermediary firms considering Mifid authorisation “may want to reconsider their permissions and move to non-Mifid status, as the costs of being a Mifid firm could outweigh the benefits.”