Germany – BaFin Issues Final Positions Limits MiFID

On 19 July 2018, GE BaFin issued final position limits, taking effect on 20 July 2018.

  • Italian power future (peak), Panamax-TC-Freight Future, Panamax-TC-Freight Option.
  • There were no changes from the draft position limits which were issued in June 2018.
  • Italian power: 5,340,219 MWh for spot month, 1,045,510 MWh for the other months.
  • Panamax: fixed at 4,049 lots for the spot month and 4,049 lots for the other months.

India – SEBI Primary Investment By FPI

On 13 July, SEBI updated investment by FPIs in primary issuance.

  • SEBI (FPI) Regulations, 2014 mandates that purchase of equity shares of each
    company, by single FPI or group, shall be below 10% of the total issued capital.

Beneficial Owners

  • Rule 23(3) of FPI Regulations requires if same set of ultimate beneficial owners
    invest through multiple entities, they will be treated as part of the same group.
  • Investment limits of such entities are clubbed at investment limit as single FPI.
  • For purpose of identifying investor group, the designated depository participant
    shall obtain details provided by FPI under clause 2.2 of the FPI application form.
  • Monitoring investment limits at group level, done by depositories based on this.

Compliance Process

  • At time of finalized basis of allotment in primary market issuance, registrar and
    transfer agents, use a permanent account number (PAN) issued by Income Tax
    Department of India for checking compliance of single foreign portfolio investor.
  • Obtain validation from depositories for the foreign portfolio investors who have
    invested in particular primary market issuance, to ensure is no breach of limits.
  • Depositories put in place the necessary systems for sharing of information with
    RTAs in timelines for issue procedures, as prescribed by SEBI from time to time

Hong Kong – SFC Amends Codes on Mergers, Takeovers

On 13 July 2018, HK SFC, gazetted amendments to codes on mergers, takeovers.

  • Released consultation conclusions and respondents were generally supportive of
    proposals, majority of which were adopted with some modifications from feedback.
  • The amended codes which were gazetted on 13 July, will be effective immediately.


Key Proposals from Original Consultation:

  • Increase voting approval threshold for whitewash waivers to 75% of shareholders.
  • Panel to require compensation be paid to shareholders who suffered from breach.
  • Clarify the obligations of persons dealing with the Takeovers Executive, Takeovers
    Panel and the Takeovers Appeal Committee in all Codes transactions, cooperation.
  • Also sets out proposed amendments to the term “associate” as well as approval
    of delistings in jurisdictions which do not afford the compulsory acquisition rights.

Hong Kong – SFC Trade Disclosure FAQs

On 15 June, HK SFC issued FAQs on disclosure of transaction data.

  • Issued consultation conclusions on proposals for regulation of asset management.
  • Point-of-sale transparency and disclosure required for discretionary accounts Nov.
  • Among others, new code requirements govern the disclosure of non-quantifiable
    monetary benefits and independence status, come into effect on August 17 2018.
  • FAQs respond to queries raised by industry regarding the implementation of rule.


  • FAQs address commissions from trailer funds, and independence of intermediary.
  • Expect licensed and registered persons to disclose maximum percentage of trailer
    fees receivable for specific fund as per distribution agreement with product issuer.
  • One objective of disclosure requirement, is to ensure that only truly independent
    intermediaries can represent themselves as independent, allows as one-off basis.

France – AMF MiFID II Guide for IAs

On 13 June, FR AMF issued updated guide for investment advisers.

Updated Guide

  • To support IAs in fulfillment of obligations, AMF updated MiFID 2 guide of October 2017.
  • More than an overview of impact of MIF 2, the guide aims to serve as a tool for IAs.
  • MiFID 2 transposed into French law by a law of 23 June 2016, in force 3 January 2018.
  • For IAs, provisions similar to MiFID transposed by order of 22 June 2017 (no. 1107).
  • Under the French IA (CIF) regime, the relevant provisions have been incorporated
    into the AMF General Regulation, these provisions, came into force on Jun. 8, 2018.
  • French IA system is changing the organization of CIFs, it introduces new concepts.
  • Eg concept of independent investment advice, and introduces new obligations for IAs.


  • The MiFID 2 guide for IAs published by the AMF now contains eight thematic sheets.
  • Seven thematic sheets of first version have been enhanced by the provisions of the
    AMF General Regulation, as well aspractical answers to frequently asked questions.
  • 8th sheet aims to present, in non-exhaustive way, steps of the customer relationship.
  • Sheets include impacts of MiFID 2 on IAs, enhancing IA authorization and monitoring
    procedure, rules of governance of the IA, and the prevention of conflicts of interest.
  • Independent investment advice, governance of financial instruments, strengthening
    customer information, evaluation of suitability of products, and putting into practice

U.S. – NASDAQ Options Position Limits

On 5 June, NASDAQ, PHLX, BX rules on SPY ETF position limits.

  • Pilot program no position limits on SPY securities scheduled to expire Jul. 12, 2018.

New Limits

  • In lieu of extending SPY Pilot Program for another year, proposed position, exercise
    limits of 1,800,000 contracts, options on SPY, becoming operative on 12 July 2018.
  • Permanent position and exercise limits established, no need to report on pilot now.


  • Pending SEC filing, plan to be effective 30 days from filing, no other major change.

Saudi Arabia – CMA on Foreign Investment

On 4 June, SA CMA adopted FAQ on investment by foreign firms.

  • Rules on investment of qualified foreign financial institution in listed securities.
  • Document aims to answer questions, which may be raised by foreign investors,
    licensed persons and interested parties, regarding rules governing investments.

Germany – BaFin Holding Notification Form

On 1 June, BaFin issued form for notification of holding acquisition.

  • German Banking Act (KWG) section 2c(1) requires BaFin, Bundesbank be notified
    of acquisition of significant/qualified interest in a securities trading company/bank.
  • Information should be provided, in accordance with MiFID II delegated regulation.
  • Voluntary form to assist with providing relevant information are on BaFin website.

U.S. – MIAX SPY Position Limit Increase

On 31 May, MIAX replaced SPY pilot program with position limits.

  • Amended Rule 307/309, Interpretations, Policies .01 to allow SPY Pilot Program
    terminate, establish position, exercise limits of 1,800,000 contracts on SPY options.
  • Operative on 12 July 2018, so no lapse in time between pilot termination, new limits.