The City watchdog has today revealed proposals to bolster a critical piece of incoming red tape, including extended plans for taping bankers' phone calls.
The Financial Conduct Authority (FCA) has published its third consultation paper on the implementation of the revised Markets in Financial Instruments Directive, which is due to come into force in January 2018, and is a successor to one of the pieces of legislation that effectively gives the UK passporting rights, more commonly known as MiFID II.
Proposals put forward by the FCA include extending the requirements on taping telephone conversations and monitoring emails beyond those strictly required by the directive to cover conversations advising corporate finance activities.
Andrew Bailey, chief executive at the FCA, said: "The changes to rules we are proposing today reflect key themes that we have worked on in both retail and wholesale markets over recent years to promote competition and market integrity."
Tim Cant, a senior associate from law firm Ashurst told City A.M. the extension of the taping rules to corporate finance activities might come as "kind of a cold water shock because they haven't had this before and quite a lot of discussions [are] going on in an informal way".
The FCA has had its own taping rules in place since 2009. These rules are not dissimilar to those in MiFID II but apply to certain sectors, such as oil market activity, which the new regulations do not.
As MiFID II stems from the EU, some might wonder whether the legislation has any relevance to the UK following the Brexit vote.
However, Bailey added: "As we said in our statement following the EU referendum result, firms must continue to abide by their obligations under UK law including those derived from EU law. They must continue with implementation plans for legislation that is still to come into effect, of which MiFID II is one such example."
The FCA consultation on the new proposals is open until next January.