MiFID II/MiFIR divergence emergence?

Since the beginning of the Brexit transition period, developments in both the UK and EU have impacted the MiFID rules in various ways.  

In the UK, there have been changes under the EUWA on-shoring process; “quick-fix” amendments; and the beginnings of implementing the conclusions of the Wholesale Markets Review.  Most recently, FSMA 2023 and the Commencement No 1 Regulations bring in transitional amendments to UK MiFIR from 29 August 2023. 

In the EU, there were also “quick-fix” amendments in response to the Covid-19 pandemic, and the EU MiFID II/MiFIR Review has resulted in a number of proposals for substantive change.

The shifting pieces in the UK and EU are starting to now give rise to meaningful divergence, albeit in some cases both the UK and EU are making changes which seek to address the same regulatory policy issues or which overlap in part. However, the way in which changes have been made often belies their similarity, and means that comparing EU and UK versions of the text for provisions does not give the full picture. For example, where the UK has had to make changes via an on-shored regulation but the EU proposes to make changes at directive level, but the substance of the changes is the same.

Our summary below sets out the key moving parts on each side of the Channel, and assesses how divergent the changes really are.

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