Is the Sky Really About to Fall?

Despite the various conferences, newspaper articles, and 'MiFID for Dummies' breakfast meetings, one theme has dominated the general chitchat about the EU Directive these past few weeks. Is MiFID really that big a deal?

Really? MiFID has been described in various mediums as "far reaching" and "poised to bring fundamental change" to the European markets. One senior manager at a data management vendor went so far as to call it "a tsunami" whose impact across the region will be devastating.

However, one staffer at a major data provider comments that it isn't MiFID that worries him, but the European Commission's Undertakings for Collective Investments in Transferable Securities Directive (UCITS III). This will have the greater impact on the financial markets, he says.

Another industry insider warns, "We have to stop the scaremongering." Of course, he goes on to say, investment banks and managers need to start planning for MiFID. But the idea that MiFID will be implemented uniformly across Europe is inaccurate. "Is the financial authority of Malta really going to implement MiFID in the same way as the FSA, which has x number of staff and resources dedicated to it?" he asks.

So if MiFID will not have the far-reaching, harmonizing effect on European markets that many expect, what is the point of the Directive?

Are those who dismiss MiFID acting like ostriches, or are the doomsayers playing Chicken Little? Considering that a recent KPMG/EIU survey (see story opposite) claims that less than half of all senior managers at financial firms have even reviewed the Directive, it is hard to say.

Think about this, if the EU had stuck with the initial timeline for MiFID implementation, you would have been complying with the Directive for over a month by now. Does that seem reasonable to you?

For any of you wishing to weigh in and pontificate in all things MiFID, Meg welcomes all debate. Please email us with your comments at mifidmeg@incisivemedia.com.