Introduction

The provisions of MiFID II relating to the holding of client assets (including client money) reflect broadly those of MiFID I. Accordingly, the core requirements relating to the holding of client assets (such as segregation, record keeping, and restrictions on the use of client assets) remain the same. However, the outright prohibition on title transfer collateral arrangements (TTCAs) for retail clients and other areas of change have the effect of making the MiFID II regime more stringent than the current MiFID I regime, and bringing it more closely into alignment with the FCA regime under CASS.

Authors: Adrian Brown

Governance arrangements

Under MiFID II firms will be required to appoint a single officer of sufficient skill and authority with specific responsibility for matters relating to the firm’s obligations regarding the safeguarding of client assets. This need not be the individual’s sole role so they could, for example, also carry on the compliance oversight function. An annual audit of the adequacy of client assets arrangements will also be required. This approach reflects that already contained in CASS.