Further to the EU Commission Roadmap on a retail investment strategy for the EU that was issued in spring 2021, respective consultations by the Commission and ESMA were launched on the topic of investor protection. ALFI responded to both the Commission and ESMA consultations in a joint effort between various ALFI working groups. They highlighted the most relevant aspects for ALFI members in this context, such as the categorisation of investors and the treatment of inducements under the Directive on Markets for Financial Instruments (MiFID II - Directive 2014/65/EU), intersections with other regulatory fields such as Regulation (EU) No. 1286/2014 on key information documents for packaged retail and insurance-based investment products, as well as risks and benefits of digitalisation and the importance of continuing efforts for financial education. 

ALFI will continue to closely follow regulatory developments in this respect and in connection with the ongoing MiFID II/MiFIR review that started with the respective EU Commission consultation to which ALFI filed its position in June 2020.

On 2 August 2022, the MiFID Delegated Directive (EU) 2021/1269 concerning the integration of sustainability factors into the product governance obligations and Delegated Regulation (EU) 2021/1253 covering the integration of sustainability factors, risks and preferences into certain organisational requirements and operating conditions for investment firms will enter into force. In order to provide guidance on the obligations for product distributors under said Delegated Regulation to ask clients about their sustainability preferences, ESMA launched in January 2022 a consultation to update its guidelines on the suitability requirements under MiFID II. ALFI responded to this consultation on 27 April 2022, outlining the challenges faced by both product manufacturers and distributors alike with regard to the sequencing of regulatory timelines and providing suggestions with regard to flexibilities that would be welcomed in the application of the guidelines.

As regards the data exchange between manufacturer and distributors in view of target market requirements under MiFID II, ALFI supports the work of FinDatEx (Financial Data Exchange Template) on the European MiFID Template (EMT). The fourth version of the EMT was published in March 2022 and will replace versions 3 and 3.1 which are valid until 31 July 2022. The template, which can be used on a voluntary basis, is designed specifically for the benefit of the financial industry and is available free of charge.

Désirée Doenges, Senior Legal Adviser