As the FT reported earlier this week, ESMA is set to step back from imposing a much contested overhaul of dealing commission.
The scrutiny of commissions has been a major concern for the buy-side, in particular ESMA's proposals to classify all but the most generally available investment research as a non-monetary benefit. This effectively implies the 'unbundling' of research from dealing commission arrangements on an EU-wide basis. Just last week Steven Maijoor used his speech on MiFID II to relay that ESMA was "carefully considering the concerns expressed by stakeholders", following strong warnings from market participants about the EU losing out in the global marketplace.
It now appears that transparency and disclosure around the use of dealing commission could be sufficient to satisfy the European regulators. In the UK, however, the FCA is yet to formalise its position having recently closed its latest consultation. Whether they, or other national regulators, will ultimately impose stricter rules than ESMA remains to be seen.
ESMA must submit advice to the European Commission by December so then, at least, there will be greater clarity on their position.