ESMA · ESMA_QA_1784 Answer Published
Underwriting and placing
- Regulation
- Markets in Financial Instruments Regulation (MiFIR) Regulation (EU) No 600/2014 - Investor Protection and Intermediaries
- Topic
- Underwriting and placing
- Submitted
- 2016-10-10
- Answered
- 2016-10-10
Question
Article 38(1)(a) of the MiFID II Delegated Regulation states that “investment firms which provide advice on corporate finance strategy, as set out in Section B (3) of Annex I, and provide the service of underwriting or placing of financial instruments, shall, before accepting a mandate to manage the offering, have arrangements in place to inform the issuer client of the various financing alternatives available with the firm”. What are "the various financing alternatives” to be considered?
Answer
[ESMA 35-43-349 MiFID II Q&As on Investor protection Ch. 6, question 1] The various financing alternatives may be limited to those appropriate to the issuer client’s needs. However, they should not be limited to financing alternatives that constitute investment services; for example, loans or extension of credit facilities shall be included if appropriate and offered by the firm. The firm should inform the issuer client which financing alternatives have not been considered, including financing alternatives not offered by the firm, with a short explanation of why they were discounted.
This Q&A is published by European Securities and Markets Authority and is non-binding. It does not constitute legal advice. Updated weekly from official ESA sources.
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