Ireland: Investment Firms Quarterly Legal And Regulatory Update

Last Updated: 24 October 2016
Article by Dillon Eustace

Most Read Contributor in Ireland, July 2017

Markets in Financial Instruments Directive ("MiFID")

(i) ESMA publishes Q&A on contracts for difference and other speculative products

On 25 July 2016, the European Securities and Markets Authority ("ESMA") published an updated questions and answers document (the "Q&A") on the application of MiFID to the marketing and sale of financial contracts for difference ("CFDs") and other speculative products to retail clients.

The Q&A includes nine new questions and answers, which address the following topics:

  • The information provided to clients and potential clients about how CFDs and other speculative products work and the risks involved, including marketing communications;
  • The assessment of appropriateness when offering CFDs or other speculative products to retail investors; and
  • Factors for national competent authorities ("NCAs") to take into account when considering commercial arrangements between two authorised firms that result in the offer of CFDs or other speculative products to retail clients.

The purpose of the Q&A is to promote common supervisory approaches and practices in the application of MiFID and its implementing measures to key aspects that are relevant when CFDs and other speculative products are sold to retail clients by providing responses to questions identified by NCAs in relation to practical aspects of the day-to-day supervision of firms involved in offering these products.

A copy of the Q&A is available at the following link:

ESMA also published a warning about the sale of CFDs, binary options and other speculative products to retail investors who are unaware of the risks associated with such products which can be found at the following link:

Markets in Financial Instruments Directive II ("MiFID II")

(i) ESMA publishes Discussion Paper on Mandatory Trade Execution Obligations for OTC Derivatives under MiFIR

On 20 September 2016, ESMA published a discussion paper (the "Discussion Paper") on the trading obligations for derivatives under the Markets in Financial Instruments Regulation (Regulation (EU) 600/2014) ("MiFIR"). Under MiFIR certain derivatives will be required to be concluded on a regulated market, multilateral trading facility, organised trading facility or a trading venue in a third country that is declared equivalent under MiFIR (the "Trading Obligation").

MiFIR restricts the Trading Obligation to apply only to classes of derivatives that are: (i) admitted to trading or traded on at least one trading venue (the Trading Venue Test); and (ii) sufficiently liquid and have sufficient third-party buying and selling interest (the Liquidity Test).

The Discussion Paper is seeking feedback from stakeholders on the options put forward by ESMA on how to calibrate the Trading Obligation. The Trading Obligation is closely linked to the clearing obligation provided for in the European Markets Infrastructure Regulation (Regulation (EU) 648/2012) ("EMIR"); once a class of derivatives needs to be centrally cleared under EMIR, ESMA must then determine whether these derivatives should be subject to the Trading Obligation.

Comments on the Discussion Paper must be submitted to ESMA by 21 November 2016. ESMA expects to publish a further consultation paper in the first quarter of 2017, and to submit draft technical standards to the European Commission in mid-2017.

The Discussion Paper is available at this link:

(ii) European Commission publishes updated table showing the state of play of technical standards under MiFID II

On 14 September 2016, the European Commission published an updated table (the "Table") showing the state of play of technical standards under MiFID I, MiFID II and MiFIR. Several of the technical standards are awaiting finalisation or a corrigendum before being published in the Official Journal of the EU.

The Table is available at this link:

(iii) European Commission adopts MiFID II Delegated Regulations

On 14 July 2016, the European Commission adopted several delegated regulations to supplement MiIFID II and MiFIR, respectively (the "Delegated Regulations").

The Delegated Regulations adopted by the European Commission include the following:

  • Exchange of information between competent authorities (which specifies the information to be exchanged between regulators for these activities, and covers information requests with respect to investment firms, credit institutions and also natural or legal persons);
  • Requirements for authorisation (which sets out the authorisation requirements for MiFID firms);
  • Tick size (which details the tick size regimes for shares, deposit receipts, exchange-traded funds, certificates and other similar financial instruments);
  • Data standards for financial instrument reference data for the purpose of transaction reporting (which specifies the data standards and formats for the reference data to be provided, and includes a table of details to be reported in the annex accompanying the regulation);
  • Information for registration of third-country firms (which specifies the information necessary for third-country firm registrations (including full name, contact details, website and details on the investment services and or activities to be performed));
  • Organisational requirements of trading venues; (specifies the organisational requirements for regulated markets, multilateral trading facilities and organised trading facilities that enable algorithmic trading through their systems);
  • Transparency obligations in respect of trading venues and investment firms with respect to shares, depository receipts, exchange-traded funds, certificates and other similar instruments (which sets out pre and post trade requirements for equity instruments); and
  • Transparency obligations in respect of bonds, structured finance products, emissions allowances and derivatives (which sets out pre- and post-trade transparency requirements for non-equity instruments).

If neither the Council of the EU or the European Parliament objects, the Delegated Regulations will enter into force 20 days after their publication in the Official Journal of the EU and will apply from 3 January 2018.

(iv) Public Consultation on national discretions in MiFID II incorporating elements of the Insurance Distribution Directive ("IDD")

On 6 July 2016, the Department of Finance published its Public Consultation on Transposition of MiFID II (the "Consultation"). The Consultation, invited all interested parties to make submissions based on national discretions on various aspects of MiFID II and the IDD.

The Consultation closed on 21 September 2016. The views expressed in this consultation process will be considered by the Minister for Finance and his officials in the context of the transposition of MiFID 2 - and to an extent the IDD - into Irish law. In total there were nine questions contained in the Consultation. The questions related to the following topics:

  • The exemption from MiFID for certain fund administrators and retail investment intermediaries;
  • The requirement to maintain the requirement that all investment firms be covered by the investor compensation scheme;
  • The requirements relating to conflicts of interest;
  • The rules relating to client order handling;
  • Whether third country firms should be required to establish a branch when providing investment services to retail clients;
  • Whether investment firms should be allowed to impose higher fees in respect of cancelled orders;
  • The designation of the Central Bank as the competent authority for MiIFD II;
  • Sanctions for breaches of the MiFID rules; and
  • Any other issues relating to the transposition of MiIFD II which have not been addressed in the Consultation.

Please see link below for a copy of the Consultation;

Capital Requirements Directive ("CRD IV")

(i) European Commission issues call for advice to the EBA on the prudential requirements applicable to investment firms

On 6 July 2016, the European Banking Authority ("EBA") published a call for advice dated 13 June 2016 that it received from the European Commission relating to the prudential requirements applicable to investment firms under the Capital Requirements Regulation (Regulation 575/2013) ("CRR") and CRD IV (the "Call for Advice").

The EBA provided a report to the European Commission on this matter in December 2015 and the European Commission has requested that the EBA provide further technical advice on some of the high level recommendations set out in the December 2015 report. The European Commission has asked the EBA to provide advice on the following:

  • The criteria and thresholds for each of the three proposed classes of investment firm (i.e. (a) systematic "bank-like" firms; (b) a middle category for the majority of firms that are note systematic but do pose risks and therefore should be subject to a less complex prudential regime; and (c) small firms which are not interconnected and which should be subject to a very simple regime to cater for wind-down;
  • The design and calibration of all relevant aspects of a new prudential regime for the three proposed classes of investment firm. This is to include advice on whether class one investment firms should be subject to the same rules as banks, and whether the new regime could be adapted to be suitable for specialised commodity derivatives firms;
  • The application of the CRD IV remuneration requirements to the different proposed classes of investment firm, and whether the proposed new classes would affect the applicability of the CRD IV corporate governance rules; and
  • Any other issues or inconsistencies that EU competent authorities may have identified in implementing the rules relating to investment firms. The EBA is to suggest how to rectify any issues identified and how to clarify terminology used.

In preparing the advice, the EBA shall consult with ESMA, as it did with the December 2015 report.

A copy of the Call for Advice is available at the following link:

On 15 July 2016, the EBA launched a data collection aimed at supporting the response to the Call for Advice. For the purpose of this data collection, the EBA published templates and instructions which are addressed to MiFID investment firms and to UCITS/AIFMD firms that conduct MiFID activities or services. The templates should be filled in and submitted to the respective national competent authorities ("NCAs") by 7 October 2016.

Copies of the templates and instructions published by the EBA may be accessed via the following link:

(ii) European Commission outlines topics for forthcoming CRD IV review and indicates further proposals are likely in second half of 2018

On 7 July 2016, the European Commission's expert group on banking, payments and insurance published the minutes of a meeting held on 26 April 2016 on bank regulation and supervision (the "Meeting") during which the expert group discussed the preparations for the European Commission's forthcoming review of, and proposed amendments to, the CRR and CRD IV.

The Directorate-General for Financial Stability, Financial Services and Capital Markets Union ("DG FISMA") presented the envisaged timeframe for the review and the proposal to amend the CRR and CRD IV together with the topics that would be included in the proposal. It further indicated that it would only conduct targeted consultations on very specific issues that would be addressed in the proposal, as many of the broader issues have already been publicly consulted upon either by the European Commission or by other organisations.

Following questioning from expert group members, DG FISMA also confirmed that the reviews of risk-weighted assets and the operational risk framework, being carried out by the Basel Committee on Banking Supervision ("BCBS") are on-going and will only be completed towards the end of 2016. Accordingly, DG FISMA confirmed that the results would not be included in the European Commission's CRD IV amendment proposal and that these topics will be dealt with in a subsequent proposal, which DG FISMA envisages will be put forward in the second half of 2018 at the earliest.

Similarly, the work being carried out by BCBS on leverage ratio buffers and review of the macroprudential framework is on-going and given the lack of agreement on leverage ratio buffers, DG FISMA does not expect to include them in the European Commission's CRD IV amendment proposal. It also indicated that it does not envisage including the results of the macroprudential framework review in the proposal.

A copy of the minutes of the Meeting are available at the link below:

To read this article in full, please click here

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.