Q&A · ESMA

Appropriateness Complex Financial Instruments

Answered

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AI-generated Summary

Shares or units in non-UCITS collective investment undertakings are complex per se under Article 25(4)(a) MiFID II and cannot be reassessed as non-complex under Article 57 of the Delegated Regulation, so execution-only services in them require an appropriateness assessment.

Details

Reference	ESMA_QA_1846
Issuer	ESMA
Published	6 Jun 2017
Answered	6 Jun 2017
Submitted	6 Jun 2017
ESMA topics	Appropriateness
Earlier Q&A document	ESMA 35-43-349 MiFID II Q&As on Investor protection Ch. 10, question 1

Provisions it relates to

Article 25 MiFID II · Assessment of suitability and appropriateness and reporting to clients
MiFID II
Explicit reference · 90%
MiFID II (whole act)
Explicit reference

Documents it refers to

Delegated actIn forceExplicit reference · 90%
Commission Delegated Regulation (EU) 2017/565 of 25 April 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of that Directive
European Commission · 31 Mar 2017 · EUR-Lex
AI summaryThe main MiFID II Delegated Regulation: defines key terms (such as investment advice, systematic internaliser, algorithmic and high-frequency trading, and direct electronic access) and sets detailed organisational requirements and operating conditions for investment firms, including compliance, conflicts of interest, remuneration, client information, suitability and appropriateness, best execution, client order handling, reporting to clients, record keeping and transaction-level obligations.