Table of Contents
Questions and Answers on MiFID II and MiFIR investor protection and intermediaries topics (ESMA35-43-349) (updated 15 December 2023)Acronyms and definitions usedTable of questionsIntroduction1 Best execution [Last update: 3 October 2019]Question 1 "Reasonable steps" Vs "sufficient steps" [Last update: 10 October 2016]Question 2 Checking fairness of prices when executing orders or decisions in OTC products [Last update: 10 October 2016]Question 3 Use of a single venue [Last update: 16 December 2016]Question 4 Accessibility of reports [Last update: 16 December 2016]Question 5 Latest date for publication of reports [Last update: 16 December 2016]Question 6 MiFID II and timing of publication of reports [Last update: 4 April 2017]Question 7 Reports for services of order execution and reception and transmission of orders [Last update: 16 December 2016]Question 8 Disclosure of reports to public [Last update: 3 October 2019]Question 9 Venue disclosure of costs [Last update: 16 December 2016]Question 10 Summary of the analysis and conclusions from a firm's execution monitoring [Last update: 16 December 2016]Question 11 Information to be published on entities within a group [Last update: 4 April 2017]Question 12 Transactions with eligible counterparties and RTS 27 [Last update: 4 April 2017]Question 13 Execution policies for investment firms or market operators operating OTFs [Last update: 4 April 2017]Question 14 Information on passive and aggressive orders in the context of portfolio management and RTO [Last update: 4 April 2017]Question 15 Securities Financing Transactions (SFTs) [Last update: 10 July 2017]Question 16 Application of best execution to OTF operators [Last update: 3 October 2017]Question 17 Disclosure of quality of execution when using direct electronic access [Last update: 3 October 2017]Question 18 Definition of 'other liquidity provider' [Last update: 25 May 2018]Question 19 Reporting for firms using a venue's RFQ system to agree a trade [Last update: 3 October 2018]Question 20 RTS 27 reporting requirements for market makers and other liquidity provider [Last update: 28 March 2019]Question 21 Reporting for venues on the 'trading mode' according to RTS 27 [Last update: 29 May 2019]Question 22 Reporting for venues and firms on template fields of RTS 27 and 28 if the required content is notapplicable to their activities [Last update: 29 May 2019]Question 23 Reporting on 'passive' and 'aggressive' orders for firms using quote-driven systems to have client orders executed [Last update: 29 May 2019]Question 24 RTS 28 reporting and third-country execution venues [Last update: 29 May 2019]Question 25 Classification of financial instruments under RTS 27 if ESMA has not published any calibrated market sizes [Last update: 11 July 2019]2 Suitability and appropriateness [Last update: 28 March 2019]Question 1 Suitability report: advice leading or not to a transaction [Last update: 10 October 2016]Question 2 Suitability report: record of when the advice is given [Last update: 10 October 2016]Question 3 Suitability report: availability on firm's website [Last update: 28 March 2019]Question 4 Suitability report: provision to the client together with the report due when carrying out an order on behalf of a client other than for portfolio management [Last update: 10 October 2016]Question 5 Suitability report: advice not to buy or sell a financial instrument [Last update: 10 October 2016]Question 6 Transactions on unsuitable products [Last update: 10 October 2016]Question 7 Disclosure of information by the client on his/her financial situation [Last update: 10 October 2016]Question 8 Record keeping obligations related to investment advice [Last update: 16 December 2016]Question 9 Periodic reporting of how the investment meets the client's preferences, objectives and other characteristics of the retail client [Last update: 18 December 2017]Question 10 Suitability report: Use of generic statements [Last update: 28 March 2019]3 Recording of telephone conversations and electronic communications [Last update: 3 October 2017]Question 1 Recording of internal telephone conversations and electronic communications [Last update: 10 October 2016]Question 2 Charging clients for access to recordings [Last update: 10 October 2016]Question 3 Monitoring of records [Last update: 10 October 2016]Question 4 Period of record keeping [Last update: 10 October 2016]Question 5 Types of electronic communications in scope of the requirements [Last update: 10 October 2016]Question 6 Monitoring of records: control function [Last update: 10 October 2016]Question 7 Recording of telephone conversations and electronic communications: critical or important operational function [Last update: 10 October 2016]Question 8 Recording of telephone conversations and electronic communications from start to end [Last update: 10 October 2016]Question 9 Client access to relevant internal conversations [Last update: 10 October 2016]Question 10 Use of mobile devices [Last update: 10 October 2016]Question 11 Telephone conversations and electronic communications that should be recorded [Last update: 10 October 2016]Question 12 Scope of activities covered by the requirements in Article 16(7) of MiFID II [Last update: 10 July 2017]Question 13 Scope of activities covered by the requirements in Article 16(7) of MiFID II (2) [Last update: 3 October 2017]4 Record keeping [Last update: 10 November 2017]Question 1 Encryption [Last update: 10 October 2016]Question 2 Securities financing transactions (SFTs) [Last update: 10 November 2017]5 Investment advice on an independent basis [Last update: 3 October 2018]Question 1 Assessment and comparison of a sufficient range of financial instruments [Last update: 10 October 2016]Question 2 'Look - through' approach [Last update: 3 October 2018]6 Underwriting and placing [Last update: 16 December 2016]Question 1 Various funding alternatives [Last update: 10 October 2016]Question 2 Information on investor clients to be provided to issuer clients [Last update: 16 December 2016]Question 3 Record Keeping [Last update: 16 December 2016]Question 4 Obligations relating to advice on corporate finance strategy [Last update: 16 December 2016]7 Inducements (research) [Last update: 12 July 2018]Question 1 Use of a Research Payment Account for more than one client's portfolio or account [Last update: 10 October 2016]Question 2 Status of client money held in a Research Payment Account [Last update: 16 December 2016]Question 3 Unrequested research provided "free of charge" [Last update: 16 December 2016]Question 4 Research from third-country providers [Last update: 16 December 2016]Question 5 Research from another group entity [Last update: 16 December 2016]Question 6 Minor non-monetary benefit vs. research [Last update: 16 December 2016]Question 7 "Corporate access" [Last update: 4 April 2017]Question 8 Macro-economic analysis [Last update: 23 March 2018]Question 9 Research related to fixed-income, currencies or commodities [Last update: 23 March 2018]Question 10 Budgeting, allocation of the research budget, determination and assessment of payments made from it [Last update: 4 April 2017]Question 11 Disclosure of client research charges [Last update: 4 April 2017]Question 12 Free trial periods [Last update: 12 July 2018]8 Post-sale reporting [Last update: 23 March 2018]Question 1 Reporting on the depreciation of the overall value of a client's portfolio [Last update: 16 December 2016]Question 2 Cash withdrawals by the client [Last update: 16 December 2016]Question 3 Reporting on the depreciation of leveraged financial instruments or contingent liability transactions [Last update: 16 December 2016]Question 4 Reporting on portfolio depreciation in case of client additions to the portfolio [Last update: 6 June 2017]Question 5 Reporting on the depreciation of financial instruments with no secondary market or daily price reference [Last update: 6 June 2017]Question 6 Value and commencement of reporting requirement [Last update: 6 June 2017]Question 7 Reporting on the depreciation: choice of value for the threshold calculation [Last update: 6 June 2017]Question 8 Flexibility allowed by client agreement (1) [Last update: 3 October 2017]Question 9 Flexibility allowed by client agreement (2) [Last update: 3 October 2017]Question 10 Reporting to retail and professional clients [Last update: 10 November 2017]Question 11 Holding a retail client account [Last update: 23 March 2018]Question 12 Reporting on the depreciation: exceeding same threshold during a reporting period [Last update: 23 March 2018]9 Information on costs and charges [Last update: 15 December 2023]Question 1 Ex-post disclosure of total costs and charges [Last update: 16 December 2016]Question 2 Illustration of the cumulative effect of costs on return [Last update: 16 December 2016]Question 3 Ex-post disclosure of the cumulative effect of costs on return [Last update: 16 December 2016]Question 4 Periodicity of ex-post information on total costs and charges [Last update: 16 December 2016]Question 5 Voluntary periodical ex-post information on total costs and charges [Last update: 16 December 2016]Question 6 Cost components of products and PRIIPs calculation methodology [Last update: 6 June 2017]Question 7 Use of products' costs presented in the PRIIPs KID [Last update: 28 March 2019]Question 8 PRIIPs calculation methodology for instruments outside the scope of PRIIPs [Last update: 6 June 2017]Question 9 Cost calculation: access to relevant data [Last update: 6 June 2017]Question 10 Cost of products falling within the PRIIPs transition period [Last update: 6 June 2017]Question 11 Unavailability of manufacturer data on costs [Last update: 6 June 2017]Question 12 Cost of transactions initiated in the provision of an investment service [Last update: 6 June 2017]Question 13 Aggregation of costs and charges [Last update: 15 December 2023]Question 14 Ex-ante disclosure and unavailability of actually incurred costs [Last update: 6 June 2017]Question 15 Calculation of ex-ante transaction costs [Last update: 3 October 2017]Question 16 Price of the position of the investment firm [Last update: 3 October 2017]Question 17 Identification and disclosure of mark-ups and structuring costs [Last update: 3 October 2017]Question 18 Eligible counterparties not intending to offer financial instruments to clients [Last update: 3 October 2017]Question 19 Specific limitations to cost disclosure for eligible counterparties and professional clients [Last update: 3 October 2017]Question 20 Disclosure in case of zero costs and charges [Last update: 3 October 2017]Question 21 Timing of first annual ex-post reports on costs and charges [Last update: 3 October 2017]Question 22 Level of individualisation of ex-ante information [Last update: 28 March 2019]Question 23 Conditions to be met to use costs grids/tables for ex-ante information [Last update: 28 March 2019]Question 24 Ex-ante information for the service of portfolio management [Last update: 28 March 2019]Question 25 Terminology [Last update: 28 March 2019]Question 26 Taxes to be included in the ex-ante and ex-post costs and charges information [Last update: 28 March 2019]Question 27 Ex-ante information in case ofsell orders [Last update: 29 May 2019]Question 28 Ex-ante information in case of telephone trading [Last update: 29 May 2019]Question 29 Use of assumed investment amounts for ex-ante information in relation to investment services and/or products with non-linear charging structures [Last update: 29 May 2019]Question 30 Use of ranges and maximum amount/percentages for ex-ante information [Last update: 29 May 2019]Question 31 Information on costs and charges: Ex-post information for the service of portfolio management [Last update: 4 December 2019]Question 32 Ex-post information under Article 50(9) of the Delegated Regulation and its relationship with information under Article 60 of the Delegated Regulation [Last update: 4 December 2019]Question 33 Fair, clear and not misleading presentation of costs and charges [Last update: 21 December 2020]Question 34 Timing ex-ante information investment advice and RTO/execution services relating to same transaction(s)s [Last update: 28 May 2021]Question 35 Foreign currency [Last update: 15 December 2023]10 Appropriateness/Complex Financial Instruments [Last update: 6 June 2017]Question 1 Financial instruments complex per se: non-UCITS collective investment undertakings [Last update: 6 June 2017]11 Client categorisation [Last update: 25 May 2018]Question 1 Information to clients on categorisation [Last update: 3 October 2017]Question 2 Clients who may be treated as professionals on request (1) [Last update: 25 May 2018]Question 3 Clients who may be treated as professionals on request (2) [Last update: 25 May 2018] Question 4 Clients who may be treated as professionals on request (3) [Last update: 25 May 2018]Question 5 Clients who may be treated as professionals on request (4) [Last update: 25 May 2018]Question 6 Clients who may be treated as professionals on request (5) [Last update: 25 May 2018]12 Inducements [Last update: 29 March 2021]Question 1 Payments made to a third party in relation to the provision of independent advice of portfolio management [Last update: 10 November 2017]Question 2 Status of client money [Last update: 10 November 2017]Question 3 Performance of the function of investment management or portfolio management of one or more investment funds for a UCITS management company or an AIF Manager [Last update: 18 December 2017]Question 4 Performance of marketing functionfor a UCITS management company or an AIF Manager [Last update: 18 December 2017]Question 5 Performance of administration function for a UCITS management company or an AIF Manager [Last update: 18 December 2017]Question 6 Application of inducements rules to financial instruments in which the firm has invested on behalf of the client before 3 January 2018 [Last update: 23 March 2018]Question 7 Minor non-monetary benefits [Last update: 28 May 2020]Question 8 Quality enhancement [Last update: 29 March 2021]13 Provision of investment services and activities by third country firms [Last update: 28 March 2019]Question 1 Reverse solicitation (1) [Last update: 25 May 2018]Question 2 Reverse solicitation (2) [Last update: 25 May 2018]Question 3 Reverse solicitation (3) [Last update: 12 July 2018]Question 4 Reverse solicitation (4) [Last update: 28 March 2019]14 Application of MiFID II after 3 January 2018, including issues of ‘late transposition [Last update: 18 December 2017]Question 1 Authorisations granted before 3 January 2018 [Last update: 18 December 2017]Question 2 Passport notifications made before 3 January 2018 [Last update: 18 December 2017]Question 3 Late transposition and passporting of investment services (1) [Last update: 18 December 2017]Question 4 Late transposition and passporting of investment services (2) [Last update: 18 December 2017]Question 5 Late transposition and passporting of investment services (3) [Last update: 18 December 2017]15 Other issues [Last update: 3 October 2019]Question 1 Understanding of the term "ongoing relationship" [Last update: 3 October 2019]Question 2 Provision of investment services by UCITS management companies or alternative investment fund managers through branches in host Member States [Last update: 25 May 2018]Question 3 Durable medium [Last update: 28 March 2019]16 Product governance [Last update: 19 November 2021]Question 1 Target market of CoCo-bond funds [Last update: 28 March 2019]Question 2 Assessment of products' costs and charges (1) [Last updated 6 November 2020]Question 3 Assessment of products' costs and charges (2) [Last updated 6 November 2020]Question 4 Assessment of products' costs and charges (3) [Last updated 6 November 2020]Question 5 Bonds embedding a make-whole clause [Last updated 19 November 2021]17 Product intervention [Last update: 4 December 2019]Question 1 Cross-border provision of services [Last update: 4 December 2019]18 MiFID practices for firms selling financial instruments subject to the BRRD resolution regime [Last update: 18 February 2020]Question 1 Sales of subordinated eligible liabilities and the assessment of suitability [Last update: 18 February 2020]Question 2 Active offering [Last update: 18 February 2020]Question 3 Information to be collected from clients [Last update: 18 February 2020]Question 4 Calculation of concentration [Last update: 18 February 2020]Question 5 Client initiative [Last update: 18 February 2020]Question 6 Monitoring of 10% threshold [Last update: 18 February 2020]
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Version date: 18 February 2020 - onwards
Question 4 Calculation of concentration [Last update: 18 February 2020]
Where a SEL issued after 28 December 2020 is sold to a retail client whose portfolio does not exceed EUR 500 000, must the seller take into account SELs issued before 28 December 2020 which are already part of the client’s portfolio, when verifying whetherthe 10% threshold referred to in Article 44a(2)(a) is exceeded?
Answer 4
Yes. When ensuring that the retail client does not invest an aggregate amount exceeding 10% of his portfolio in SELs, the seller should add up the values of all SELs present in the client’s portfolio, regardless of their issuance date.