The SEC, after consultation with European authorities, issued three related no-action letters designed to allay concerns that investors could lose access to valuable research as market participants comply with the EU's MiFID II ahead of the Jan. 3, 2018 implementation date. The no-action relief provides a path for market participants to comply with the research requirements of MiFID II in a manner that is consistent with U.S. federal securities laws. More specifically, and subject to various terms and conditions: (1) broker-dealers, on a temporary basis, may receive research payments from money managers in hard dollars or from advisory clients' research payment accounts without registering as an investment adviser; (2) money managers may continue to aggregate orders for mutual funds and other clients; and (3) money managers may continue to rely on an existing safe harbor when paying broker-dealers for research and brokerage.
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