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Forex news -forex broker review => Forex => Topic started by: forex4you on Nov 18, 2022, 06:59 pm

Title: ESMA Seeks Public Feedback on New License Passporting Rules
Post by: forex4you on Nov 18, 2022, 06:59 pm
ESMA Seeks Public Feedback on New License Passporting Rules

<p>The European Securities and Markets Authority (ESMA) aims to strengthen the provisions around the passporting of financial services licenses by adding a few more rules to the Markets in Financial Instruments Directive (<a href="https://www.financemagnates.com/forex/analysis/mifid-ii-more-harm-than-good/" target="_blank">MiFID II</a>).</p><p>Passporting of licenses allow investment firms to obtain financial services licenses from any of the European Union member countries and then passport them to offer services anywhere in the 27-country bloc.</p><p>Announced on Thursday, the European Union's financial markets regulator and supervisor want companies to reveal specific details at the passporting stage. </p><p>If approved like they are suggested, the investment firms will need to provide <a href="https://www.financemagnates.com/terms/m/marketing/" target="_blank" id="48d4594c-de24-47ac-9f1b-aa2e0da8374a_1" class="terms__main-term">marketing</a> which means that it will be used in the passported EU member state; language in which customer grievances and complaints will be handled; the active markets where the investment firms will use the passport, along with categories of targeted clients; and internal organization concerning the cross-border activities of the firm.</p><p>The EU regulator will close its consultation on the proposed rules on 17 February 2023 and consider the feedback in Q2 2023. It is expected to publish a final report by the end of next year.</p><p>Tightening the Gaps</p><p>The proposal came after the EU regulator raised concerns about the actions of multiple National Competent Authorities (NCAs) in cross-border activities. Earlier, it reviewed the supervision of six NCAs.</p><p>"The cross-border provision of investment services is a key element of the single market of financial services as it fosters competition and expands the offer available to consumers who can choose among a broader number of firms and investment opportunities," the <a href="https://www.financemagnates.com/forex/regulation/esma-wants-curbs-on-gamification-of-trading-payments-for-order-flow/" target="_blank">e</a>tx stated.</p><p>The Cyprus Securities and Exchange Commission (CySEC), which oversees several retail brokers, <a href="https://www.financemagnates.com/forex/regulation/esma-recommends-cysec-to-improve-cross-border-activities-supervision/" target="_blank">received several recommendations</a> from ESMA, primarily to increase the human resources needed for the supervision of cross-border services and strengthen its supervisory activities around the monitoring and enforcement of <a href="https://www.financemagnates.com/terms/c/compliance/" target="_blank" id="569f58ee-534c-44f0-a7cd-f55b0f9a2b2a_1" class="terms__secondary-term">compliance</a> measures.</p><p>"ESMA and NCAs have noted the continued increase in cross-border activities to retail clients provided under the MiFID II free provision of services regime," the EU regulator added. "However, the increase in cross-border activities by investment firms clearly requires NCAs to increase their focus on the supervision of cross-border activities and on cooperation. A development of cross-border activities which is not accompanied by increased supervisory focus risks undermining investors' trust and backfiring on the achievement of the single market."</p>

This article was written by Arnab Shome at www.financemagnates.com.

Source: ESMA Seeks Public Feedback on New License Passporting Rules (https://www.financemagnates.com//forex/esma-seeks-public-feedback-on-new-license-passporting-rules/https://www.financemagnates.com//forex/esma-seeks-public-feedback-on-new-license-passporting-rules/)