COBS 2.3C Research and execution services
Application
1This section applies to an investment firm providing execution services to:
- (1)
a firm carrying on MiFID, equivalent third country or optional exemption business; or
- (2)
an investment firm authorised under MiFID that is not within (1); or
- (3)
a UCITS management company; or
- (4)
a full-scope UK AIFM; or
- (5)
a small authorised UK AIFM; or
- (6)
a residual CIS operator; or
- (7)
an incoming EEA AIFM branch2; or
- (8)
Requirement on a firm that executes orders and provides research to price and supply services separately
A firm providing execution services must:
- (1)
identify separate charges for its execution services that only reflect the cost of executing the transaction;
- (2)
subject each other benefit or service (other than an acceptable minor non-monetary benefit in COBS 2.3A.19R) which it provides to persons listed in COBS 2.3C.1R(1) to (6) to a separately identifiable charge; and
- (3)
ensure that the supply of, and charges for, other benefits or services under (2) is not influenced or conditioned by levels of payment for execution services.
[Note: article 13(9) of the MiFID Delegated Directive]
Compliance with COBS 2.3C.2R is intended to enable a firm subject to COBS 2.3A.15R and COBS 2.3A.16R to comply with its obligation not to accept and retain fees, commissions or any monetary or non-monetary benefits paid or provided by any third party or a person acting on behalf of a third party in relation to the provision of the service to clients.
[Note: recital 26 to the MiFID Delegated Directive]