Consob has launched a new dialogue with the market through a consultation on a broad package of amendments to the Markets, Intermediaries and Issuers Regulations. The review pursues two objectives: on the one hand, to implement the European regulatory developments introduced by the MiFID, AIFMD and UCITS Directive, as well as the MiFIR Regulation; on the other hand, to reduce the burden on market participants, making the regulatory framework more efficient and consistent with market developments.

The initiative forms part of the process aimed at strengthening the Capital Markets Union by improving the transparency and accessibility of market data, reducing reporting requirements, supporting investment research and achieving greater harmonisation of the rules applicable to managers of undertakings for collective investment in transferable securities (UCITS) and alternative investment funds (AIFs). The proposals are accompanied by a preliminary regulatory impact assessment covering those areas in which Consob retains a degree of discretion and which do not merely involve the implementation of European legislation. The assessment was calibrated to the nature of the initiative, which is intended to streamline the regulatory framework. With regard to market infrastructures, the proposal updates, among other matters, the rules applicable to intermediaries that deal on own account by executing client orders outside a trading venue, known as systematic internalisers. It replaces the current approach based on quantitative trading thresholds and strengthens the flow of information to Consob. The rules on position limits, pre-trade and post-trade transparency and the provision of market data are also revised.

For intermediaries, one of the most significant changes concerns the simplification of their best execution obligations. In particular, the requirement to publish annually a list of the top five execution venues and information on the quality of execution obtained is removed. The package also addresses investment research, bringing the rules into line with the new framework introduced by the Listing Act through a review of the conditions under which research services may be paid for separately.

Significant changes also concern the collective asset management sector. The amendments broaden the range of activities that may be carried out by managers, including the reception and transmission of orders by UCITS management companies; harmonise liquidity management tools and the related disclosure obligations towards investors; update the rules governing loan-originating AIFs; and address conflicts of interest relating to undertakings for collective investment established at the initiative of third parties. The procedures for the retail marketing of European Union AIFs in Italy will also be updated.

The proposals also cover insurance-based investment products (IBIPs) distributed by intermediaries subject to Consob supervision. They are intended to streamline pre-contractual disclosure requirements and reduce the burden on market participants, while promoting greater alignment with the rules issued by the Italian Insurance Supervisory Authority (Ivass).

Certain amendments also concern financial advisers. The consultation document clarifies the criteria under which the Supervisory Body for Financial Advisers (Ocf) may impose the penalty immediately below or above the one ordinarily applicable, specifying in particular the conditions under which a penalty may be reduced.

The package is completed by a number of coordination measures concerning the register of investment firms, intermediaries’ internet domains and authorisation procedures.

The consultation will remain open for 60 days from the date of publication of the document. Comments may be submitted in accordance with the procedures set out in the consultation document by completing the relevant consultation response form and sending it through the dedicated submission form.