AI Summary of Commission Delegated Directive (EU) 2017/593 of 7 April 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council with regard to safeguarding of financial instruments and funds belonging to clients, product governance obligations and the rules applicable to the provision or reception of fees, commissions or any monetary or non-monetary benefits (Text with EEA relevance) (MiFID II Delegated Directive)
The Commission Delegated Directive (EU) 2017/593 outlines critical obligations for investment firms under Directive 2014/65/EU, enhancing investor protection through strict safeguarding of client assets. It mandates firms to maintain transparent records, conduct regular reconciliations, and segregate client assets effectively. A designated officer must oversee compliance with these obligations, ensuring firms manage risks associated with client funds and financial instruments responsibly.
Additionally, the Directive establishes product governance requirements, insisting on robust frameworks for the manufacture and distribution of financial products. It specifically addresses the need for investment firms to conduct thorough assessments of target markets and risks, ensuring products align with client needs. Furthermore, conditions surrounding the receipt of fees and commissions are enforced to prevent conflicts of interest, promoting clear disclosures and accountability in client interactions.
