Regulatory Alerts2023-08-03
Added · Updated
Guidelines on MiFID II product governance requirements
These guidelines establish requirements for firms manufacturing or distributing financial instruments and structured deposits to identify potential target markets based on five cumulative categories: client type, knowledge and experience, financial situation, risk tolerance, and objectives. Manufacturers must balance quantitative criteria with qualitative considerations and define complexity levels, with specific restrictions requiring that complex products like CFDs be confined to high-risk seeking clients or withdrawn if no compatible market exists. Competent authorities must notify ESMA of their compliance status within two months of publication, while financial market participants are not required to report compliance.
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