The Chartered Institute of Public Finance and Accountancy (CIPFA) is working with Local Authorities (LAs) and relevant Financial Institutions (FIs) to deliver an online solution to manage the initial and ongoing requirements of both parties under the MiFID II electing up process. In addition, CIPFA will be seeking to further enhance its training provision to provide an online platform to deliver relevant training to assist LAs in passing the qualitative test.

Many LAs will wish to request their FI counterparts to classify them as “Professional” and are increasingly concerned about the initial classification process and ongoing requirement to share information in a timely fashion. Similarly, FIs are facing many LA classification requests over a short period in Q4 2017.

CIPFA’s solution to managing this process is “Public Sector Link”. This is an online portal whereby LAs record their key organisational and individual data in a consistent format that is easily transmitted to multiple FIs. The system will allow them to request to be elected up to Professional, as well as easily allowing them to share further information which may result in a change in status on an ongoing basis. The platform will be available to FIs and LAs later in 2017 and CIPFA would like to hear more about how you view the impact of MiFID II on your business. We would like to have your feedback through responses to the following brief questionnaire.

Please note, your responses will be treated as confidential and any data presented regarding the results of this questionnaire will be on a consolidated basis and your organisation will not be identifiable. The results will inform the final scoping, and future design of the Platform, and will be shared with participants and presented at relevant CIPFA events.

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* 1. Name of Organisation

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* 2. Type of Organisation

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* 3. Please select the activities that your organisation currently participates in with Local Authorities and LGPSs

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* 4. How many Public Sector relationships do you have?

  Clients (as per FCA definition) Other
Local Authorities
Housing Associations
Higher & Further Education
Charities
NHS

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* 5. What percentage of Local Authority clients would you be expecting to elect up to "Professional"

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* 6. Are you expecting to classify relevant LAs at organisational level or on a Product by Product basis

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* 7. Please indicate whether the following products / services that your organisation currently provide to LAs and LGPSs will continue to remain available, in the event of a Retail classification, or whether new / different products will be required. 

  Existing products will continue to be available Changes required to products available
Money Market Deposits
Structured Deposits
Money Market Funds
Other Fixed Income Funds
Property Funds
Equity Funds
Other VNAV Funds
Exchange Traded Funds
Tradeable Instruments (Bonds, CDs, TBills, Floating Rate Notes, Commercial Paper)
Custody
Advisory

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* 8. If you don't have to ability to provide all the products currently offered to Professional clients to LA Retail Clients, are you expecting to change your services / products, and what would be the impact on LAs? (e.g. switch out of current funds / accounts into different funds / accounts)

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* 9. Once you start acepting Electing Up requests from clients, how long would you expect the classification process to take for your LA clients?

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* 10. How many hours do you anticipate spending on each LA Electing Up request?

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* 11. If an Elected Up Professional Client made you aware of information that would require reclassification as Retail, what action would you take?

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* 12. In order to determine whether a LA passes the "qualitative test" for being able to be classified as Professional (i.e. the assessment of the expertise, experience and knowledge of a Local Authority that gives reasonable assurance, in light of the nature of transactions or services envisaged, that the client is capable of making his own investent decisions and understanding of the risks involved), which of the following would you find useful for each relevant indidual within the organisation:

  Critical Important Quite Important Not relevant
Length of Experience within the Financial Markets
Length of Experience in Local Authorities
Category of Current Role (e.g. Back Office, Dealer, Supervisory, Ultimately Responsible)
Length of Service in Current Role
Relevant Qualifications
Training Courses / Events Attended
Number of relevant transactions undertaken

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* 13. To what extent would you think the following cause you concern when applying the "Qualitative Test" referred to above?

  Major concern Significant concern Some concern None
Lack of access to real-time market data
Lack of evidence of objective risk management framework
Limited dedicated internal resources

Over-reliance on external organisations for decision making
Lack of detail in published treasury management strategies
Not part of network / community / club
Limited attendance at peer conferences / events

Low scrutiny of function (members / auditors)

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* 14. Are you expecting to obtain classification on a product by product basis or at entity level?

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* 15. To what extent would the following platform features benefit you?

  Critical Valued Useful Irrelevant Unsure

Managed workflow for Electing Up process
Platform for ongoing obligations for managing classifications
Standardised and Comprehensive data from LAs to support Electing Up requests
Electronically certified by verified officers within in LA

Live dashboard for managing dialogue during the Electing Up process, and easy viewing of current classifications

Peer comparison reports providing progress/outcomes against anonymised FI universe

FI to LA communication tools e.g. messaging

Publication of products / research
Secure transmission of other key documents (e.g. SSIs, Dealing Mandates, Authorised Signatory Lists, KYC information, Deal Confirmations etc)

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* 16. Please use this space to enter any other comments you may wish to make

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* 17. Assuming the FCA provides no further detail on the minimum investment balance criteria of £15m, how would you expect to measure this?

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* 18. Contact Information

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* 19. Would you like to register an interest in hearing more information about Public Sector Link?

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