Special Regulatory Requirements

Question 1

A client moves into physically delivered OTC traded commodity derivatives. Which of the following statements is true in relation to the application of MiFID?
AMiFID will always apply BMiFID will apply if the client is an eligible counterparty CMiFID will apply if the client is a professional client DMiFID will never apply in this situation

Answer 1

MiFID will always apply,

MiFID does not cover derivatives used for commercial (risk management) purposes, but does cover the trading of commodity derivatives for non-commercial or speculative uses. This includes physically delivered OTC derivatives.

Question 2

Which of the following describes the most important benefit of using a Trade Repository?
ATo agree the terms of a trade BSpeed up settlement of transaction CTo provide a transparent record DEnsure central counterparties are used

Answer 2

To provide a transparent record ,

This is seen as the most important as far as regulators are concerned.