On Friday 20 March, with a large number of companies forced into using remote working because of the coronavirus pandemic, the European Securities and Markets Authority (ESMA) clarified its expectations regarding compliance with the MiFID II directive's requirement on the recording of telephone conversations.
The directive states that credit institutions and investment firms must keep a record of all telephone conversations relating to, at least, transactions concluded when dealing on own account and the provision of client order services that relate to the reception, transmission and execution of orders.
In a public statement, ESMA acknowledges that “considering the exceptional circumstances created by the Covid-19 outbreak, some scenarios may emerge where, notwithstanding steps taken by the firm, the recording of relevant conversations required by MiFID II may not be practicable”, citing as an example a significant proportion of staff working remotely, or the lack of access to electronic communication tools by customers.
In such exceptional cases, ESMA states that it expects companies to take alternative steps to mitigate the risks related to the lack of recording, such as taking minutes or written notes of telephone conversations, after first informing the customer that the call cannot be recorded.
These steps must of course be “temporary” and the recording of telephone conversations must be reinstated “as soon as possible”, says ESMA.
To read the statement, go to: https://bit.ly/33AlbiL (Original version in French by Marion Fontana)