Thomson Reuters and Clifford Chance have expanded their recent collaboration to provide services to financial institutions who must comply with new post-trade transparency requirements as mandated by the Markets in Financial Instruments Directive II (MiFID II).
The collaboration comes ahead of the 3 January 2018 deadline for meeting the MiFID II legislation which, according to the Financial Conduct Authority, is a wide-ranging piece of legislation and, depending on a financial institution’s business model, could affect a range of functions including trading, transaction reporting, and client services.
Compliance with MiFID II legislation will require financial institutions to update client documentation for all clients that trade in securities. To comply with this regulation, some institutions will need complex legal advice on the scope and detail of the ensuing contractual amendments as well as a plan for updating the legal documents and responding to queries for a high volume of clients, known as re-papering. It will also require additional people and processes that few financial institutions currently employ as part of their ongoing operations.
Thomson Reuters and Clifford Chance have a proven approach to regulatory compliance that was developed in response to recent regulations relating to margin rules for uncleared derivatives. Similarly, this new joint approach combines Clifford Chance’s deep knowledge and expertise around the legal implications of MiFID II with the ability of Thomson Reuters Legal Managed Services to deliver scalable, flexible, and technology-enabled solutions to support all aspects of documentation projects, including: project management, contract data management, client outreach, contract drafting and negotiation, data extraction and quality assurance.
“Financial institutions are still working on the best way forward when it comes to handling certain aspects of MiFID II, and this is the case when it comes to updating the Terms of Business and similar documentation. Most are still working on their plans to solve this challenge and to prepare for the questions they might receive from their own clients in response to the changing documentation,” says Eric Laughlin (pictured), managing director, Thomson Reuters Legal Managed Services. “Thomson Reuters and Clifford Chance are ready to help tackle these challenges with an approach that combines guidance on the legal requirements with the technology-enabled processes to undertake the large volumes of new documentation that MiFID II compliance will require.”
Monica Sah, regulatory partner at Clifford Chance, says: “We are committed to delivering a world-class service to our customers that offers the highest quality advice and support in the most efficient and effective way possible. Working with industry leaders, such as Thomson Reuters, to combine our strengths and theirs is increasingly important as we help clients to overcome challenges of unprecedented scale and complexity.”
The joint offering for MiFID II includes a full scoping and analysis service to identify the best approach to re-paper a financial institution’s full inventory of legal documents within the shortest period of time. It also provides robust and detailed playbooks and a suite of templates to ensure compliant documentation, plus cost effective and scalable teams of full-time legal and financial professionals globally to provide the managed services of drafting, client outreach and negotiation work. In addition, it handles all the related project management capabilities to ensure a successful outcome and minimise the impact and demand placed on internal teams.
“A distinct advantage of the combined offering is that we can be ready to commence a project within a matter of weeks and can provide fully transparent pricing and certainty. And, if needed, we have the added advantage of deploying advanced document assembly and data extraction technology and capabilities,” says Laughlin.