The Cyprus Securities and Exchange Commission has announced that the Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive (‘MiFID II’) of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Regulation (‘MiFIR’) will enter into application on 3 January 2018.
In particular, MiFID II must be transposed into national law in Cyprus by 3 July 2017 and will be applicable as of 3 January 2018, whereas MiFIR will be directly applicable on 3 January 2018. It is noted that that the national law which transposes MiFID II is currently before the House of Representatives.
CySEC, highlights the main changes introduced by MiFID II, MiFIR, and the relevant delegated and implementing regulations, which affect the authorisation requirements for investment firms, including Cyprus Investment Firms (‘CIFs’). An overview of all obligations set out in MiFID II and MiFIR can be found in the Practical Guide published by CySEC in October 2014.
CySEC has also emphasized that all market participants that are affected by the changes introduced by MiFID II and MiFIR must start preparing for the implementation of the new legislative framework and take all steps to comply with it as of 3 January 2018. Such market participants include:
i. CIFs which will need to extend their authorisation to cover new investment activities and/or financial instruments introduced by MiFID
ii. entities that will no longer be exempt from the scope of this legislation,
iii. persons undertaking high frequency algorithmic trading1 that will now fall within the scope of MiFID II, and
iv. currently unauthorised businesses/entities that will have to be authorised under MiFID II.