Corporate Advisory

MiFID II – Unbundling, the Research Dilemma

With delays and limited clarity, the the buy-side are left left facing a number of pressing questions about paying for research under MiFID II.

When ESMA finally announced its long-awaited capital market reforms a few months ago, the fund management community had a lot to digest and think about. With 28 new rules to consider and lots of details around reporting, questions about research and how is gets paid for remain high on the list of challenges and concerns.

It’s a question that’s likely remain open for a while yet with a view that more clarity is unlikely to appear from ESMA until at least February and perhaps even March.

Until then, much uncertainty surrounds how exactly fund managers go about paying for research. One thing is clear, investment managers must set their research budgets in advance either through Commission Sharing Arrangements or, in the event that the EC decides that managers have to pay for research separately, via a Research Payment Account.