Christopher Leonard, Christopher Poon Article on Mifid II Published by IFLR

“An excess of ambition,” an article by Akin Gump litigation partner Christopher Leonard and associate Christopher Poon, has been published by IFLR in its February issue.

The authors discuss the proposed reforms of the Markets in Financial Information Directive (Mifid), “intended to address significant weaknesses that the [financial] crisis had exposed in the European regulatory framework,” that would be known as Mifid II. Noting that these reforms were “extensive and ambitious,” they focus on their implementation, the timetable for which they characterize as “too ambitious.”

The article, thus, sketches out the path by which Esma’s (European Securities and Markets Authority) implementation scheme was delayed, discussing the progression of legislation, emerging signs of the need for postponement of implementation, and potential market impact in the face of the lack, to date, of formal confirmation of a delay, which the authors estimate will most likely be up to a year.

The authors conclude, “The underlying purpose of the Mifid II reforms was well-founded and good intentioned. But the ability of European legislators to design and implement rules has, once again, been outpaced by their regulatory ambitions. The industry knows what view a regulator would take of a firm’s failure to adapt its processes and systems to reflect new law in a timely way. It is surely appropriate that the industry, national regulators and legislators themselves take the same view of the failure to establish and adhere to a considered and reasonable implementation timetable.”

To read the full article, please click here.