Six major global banks have adopted the first fully-digitised MiFID II trade compliance engine for the financial markets.
The new service from Droit Financial Technologies (Droit) was launched in January ahead of the MiFID II deadline, and instantly expands the ability of financial institutions to comply with the thousands of pages of MiFID II regulations. Goldman Sachs Asset Management has also gone live as the first buy-side client.
The new platform, whose clients include BNP Paribas, CACIB, Goldman Sachs (including both its broker/dealer and GSAM entities), and UBS, is an extension of Droit’s award-winning ADEPT (the Operating System for Regulation). It provides the current and complete digitised machine-readable MiFID II rule text and machine-executable implementation, enabling complete verification and auditability of every trading decision, including traceability to the letter of the law.
“Droit’s ADEPT product is a central part of our eligibility architecture for MiFID II for both our broker/dealer and GSAM businesses, across a range of obligations. Droit’s innovative approach to the digitisation of regulation and eligibility, and the evolution of their ADEPT product fits well with our overall strategy,” says Jo Hannaford, Managing Director, Technology Division, Goldman Sachs.
“Droit has successfully implemented an innovative and exciting platform which helps us strategically respond to industry and regulatory changes, like MiFID II, in the interest of better serving our clients. It is a core part of our digital strategy to work with leading providers like Droit to complement our in-house expertise to stay at the cutting edge of digital global markets,” says Cyril Cottu, Global Head of eCommerce and Digital, BNP Paribas Global Markets.
“The speed and ease with which we can implement new regulatory rule sets coupled with the flexibility of the core product integration means Droit is well placed to be the strategic regulatory eligibility platform for the Investment bank,” says Simon Herbert, MiFID II Programme Lead at UBS Investment Bank.
“Digitisation is much more than an exercise in tagging data; it’s the complete analytic structuring of one of the financial markets’ largest ever pieces of legislation. Droit provides the full stack, starting with digitising the actual legal texts into an open, standard, machine-readable format through to standard executable implementations within real-time systems,” says Satya Pemmaraju, CEO of Droit. “As regulations live and breathe, so our clients’ implementations and legal sources evolve in synchronicity.”
Transactional compliance requires the knowledge, maintenance and automation of highly complex global rule systems. Droit’s Adept platform responds to this need by generating the full global cross-regulatory implications and obligations of a trade in real-time along with unprecedented per-enquiry audit capabilities.
The corpus of digitised machine-readable legislation is represented using the open Akoma Ntoso XML standard that is now used by numerous regulatory and legislative bodies. The machine-executable implementation is called from with trading and operational systems.
MiFID II is the latest in the range of global regulations implemented in ADEPT which has been in live production since March 2014, and which now encompasses derivatives and securities across all asset classes, all G20 aligned regulatory regimes, global CCPs and execution platforms. ADEPT supports eligibility and scope of obligation determination for 14 critical MiFID II/MiFIR mandates.
