In a new paper released by the Swedish Presidency of the EU Council (attached for easy reference), it is proposed that payments for research and execution services can be bundled by investment firms.
This represents an important evolution of the controversial research unbundling imposed by MiFID II on how research can be paid. Currently, if using clients’ funds to pay for research services investment firms can only pay for research services out of a research payment account isolated from the execution services payments.
With this change, investment firms that use clients’ funds will be able to pay for research services with the same commission as they pay for execution services, provided they maintain the necessary transparency vis-a-vis the client as to the payment choice made.
Considering that the clients’ agreement for any additional costs will remain a requirement, we do not expect any important shift in the way investment firms pay for research services.
However, with the new proposal investment firms, when using clients’ funds, will be able to pay for US-based brokers’ research services by using trading commissions, which will become a requirement from 4 July 2023 with the termination of the SEC non-action letter on MiFID.
We will inform you when this proposal is approved by the EU Co-Legislators, or, in the absence of such formal approval, when ESMA provides the necessary regulatory forbearance.
Click here to down the full paper released by the Swedish Presidency –Listing Act – Presidency compromise proposal on Listing Act Directive.
This is achieved by providing portfolio managers and analysts with pre-formatted and pre-populated templates directly in Outlook, where the relevant data can be filled in. This also avoids low-value normalization of individual data sets reported by each broker.
Outlook Analyst Interaction
Directly from Outlook, users can log and tag any issuer interaction either intermediated by a sell-side or as a result of a direct engagement.
Customizable, intra-day updated and ready to be used reporting to track activity and overall budget