MiFID II is a European regulation which builds on the original regulation (MiFID I) that sought to make investing more transparent and to standardise regulatory disclosures required for particular markets. What that meant was all financial companies were required to be clearer about costs and charges, and explain them in a standard way.
MiFID II is the combination of the conclusions of the MiFID I review, and the EU implementation of the G20 commitments in response to the financial crisis in 2007/8.
The European Commission set out four objectives for MiFID II:
- To strengthen investor protection.
- To reduce the risks of a disorderly market.
- To reduce systemic risks.
- To increase the efficiency of financial markets and reduce unnecessary costs for participants.
MiFID II came into effect on 3 January 2018, changing the way we operate in the UK and Europe. It also impacts any clients around the world that invest in our UK and European domiciled products.
There are four main areas of change associated with MiFID II for Columbia Threadneedle Investments and our customers:
- Research costs.
- Costs and charges.
- Target market.
- Policies and procedures.
More information on the four main areas can be found below.