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Client consent to execution policy and execution of orders outside a regulated market or MTF - COBS Provision: Difference between revisions
Client consent to execution policy and execution of orders outside a regulated market or MTF - COBS Provision (view source)
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The vexed question of how clients consent to a best execution policy in general, and provide permission for their orders to be handled away from regulated exchanges in particular, is covered in COBS {{cobsprov|11.2.25}} and {{cobsprov|11.2.26}}. As we shall see. | |||
{{cobssnap|11.2.25}} | {{cobssnap|11.2.25}} | ||
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21.1 Where {{tag|MiFID}} requires "prior express consent", CESR considers that this entails '''an actual demonstration of consent by the client which may be provided by signature in writing or an equivalent means''' (electronic signature), by a click on a web page or orally by telephone or in person, with appropriate record keeping in each case. <br>}} | 21.1 Where {{tag|MiFID}} requires "prior express consent", CESR considers that this entails '''an actual demonstration of consent by the client which may be provided by signature in writing or an equivalent means''' (electronic signature), by a click on a web page or orally by telephone or in person, with appropriate record keeping in each case. <br>}} | ||
=====Instruments that are not admitted to trading on a Regulated Market or MTF===== | =====Instruments that are not admitted to trading on a Regulated Market or MTF===== | ||
While {{cobsprov|11.2.26}} | While at first blish it reads as though {{cobsprov|11.2.26}} should apply to all orders, even those which cannot be traded on a [[regulated market]] in any circumstances, the confines of common sense and logic have not entirely escaped the {{tag|European Commission}}. In its "[http://ec.europa.eu/yqol/index.cfm?fuseaction=legislation.showIssue&issueId=69&browse=true&questionId=173 Questions on Single Market Legislation]" resource, it notes: | ||
{{quote|However, on a purposive reading of the express consent requirement, an investment firm does not have to obtain express consent from its clients where the relevant instruments are not admitted to trading on a [[regulated market]] or [[MTF]].}} | {{quote|However, on a purposive reading of the express consent requirement, an investment firm does not have to obtain express consent from its clients where the relevant instruments are not admitted to trading on a [[regulated market]] or [[MTF]].}} | ||