According to a report from Bloomberg, EU policy makers are in the embryonic stages of relaxing some of the key parts of the securities legislation that make up the MiFID II regulations. In what will be seen as a victory for common sense for a lot of industry groups, the current pandemic has led authorities to look at every avenue to ease the stress on companies and financial markets. As European Parliament lawmaker, Markus Ferber, put it, ‘When many companies need to strengthen their equity base due to the crisis, we should try to get rid of as many obstacles as we can’ adding, ‘Streamlining some of the investor-protection provisions and making them more fit for purpose for a world that relies a lot more on distant communication seems sensible’.
The easing of some of the MiFID II burdens would come with a sigh of relief from large parts of the industry that has long campaigned that the requirements of the proposed legislation were both costly and overly complex. In an email Ferber seemed to recognise this saying, ‘MiFID II has created some administrative burdens for intermediaries and has made accessing financial markets more complicated for retail clients’. It is hoped an easing of the MiFID II rules will encourage both companies and market participants to trade, raise funds and invest with less red tape.
Also, the game of chicken that the UK and EU are playing over trade talks has been ratcheted up after the UK increased planning for a no-deal Brexit. The UK is prepared to walk away from the trade talks unless the EU gives ground. The UK government has a no-deal planning committee, meeting twice a week. In a clear sign to exert pressure on the EU, the committee will now meet more regularly, and civil servants who had been dealing with the coronavirus crisis will now be sent back to work full time on no-deal preparations.
The ramping up of pressure comes as it’s been reported that Britain's chief Brexit negotiator, David Frost, has told his boss (Boris Johnson) that the EU and Michel Barnier, the EU’s Brexit negotiator, are ‘losing the argument’. However, ultimately, Frost warned that Barnier was straitjacketed by the EU's refusal to change his negotiating mandate, although there are whispers that the EU is willing to back down from its hard line on fishing rights to try to get the talks moving forward again.