QUICK TAKE: ITG Says SEC to Offer Guidance on MiFID II

Traders Magazine Online News, February 13, 2019

John D'Antona Jr.

Does MiFID II matter to U.S. regulators?

To a degree, yes. In a recent research note from ITG, the firm reported the Council of Institutional Investors (CII), SIFMA and MFS are urging the SEC to provide clarity on whether U.S. asset managers will continue to be able to pay cash for research.

Recall that in January 2018 the SEC issued a 30-month “no action” letter, allowing funds which are subject to MiFID II unbundling requirements to pay for research with hard dollars, ITG recounted. In its comment letter, MFS asserted that the current state of affairs promotes de facto cross-subsidization, with US investors effectively paying some research costs for EU investors.

“The SEC has been clear that MiFID II is not a top priority, but they will likely offer some guidance in the not-too-distant future so as not to leave asset managers scrambling towards the end of the 30-month period,” ITG wrote. 

 

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