Introduction
In today’s highly regulated financial environment, the need for accurate, complete, timely, reliable, and readily accessible records has never been more critical. Increasingly, financial firms are receiving formal requests from regulators regarding MiFID II Directive (Directive 2014/65/EU) RTS 24 (Venue obligation) and Article 16(6) and 16(7) (investment firm obligation) data submissions. These regulatory inquiries can come at short notice and often carry significant consequences for firms that are unprepared.
Failing to respond adequately could lead to hefty penalties, reputational damage, and operational disruption. As such, having a robust record-keeping system is no longer a luxury, it’s a necessity.
At Reg-X, we provide automated, secure, and fully compliant record-keeping solutions designed to make regulatory compliance stress-free, cost-effective, and audit-ready.
What Are the requirements to comply with MiFID II RTS 24 and Article 16(6) and 16(7)?
Understanding the scope of MiFID II RTS 24 and Article 16(6) and 16(7) and is essential for any firm seeking to stay compliant:
RTS 24: Order Record Keeping for Venue
Part of the Markets in Financial Instruments Regulation (MiFIR), RTS 24 mandates investment firms operating venues to retain granular records of all orders and transactions. These records support market transparency and enable regulators to monitor trading behaviour for compliance and potential abuse. Regulators such as the European Securities and Markets Authority (ESMA) and the Financial Conduct Authority (FCA) can request this data at any time.
🔗 Learn more from ESMA’s RTS 24 Guidelines
MiFID II Directive (Directive 2014/65/EU): Article 16(6) and 16(7)
Outlines the obligations for investment firms to maintain records of all services, activities, and transactions to enable competent authorities to perform their supervisory tasks. MiFID II Delegated Regulation (Commission Delegated Regulation (EU) 2017/565) – Article 75, along with Section 2 of Annex IV, specifies the details that investment firms must record concerning client orders and decisions to deal.
Why Are RTS 24 and MiFID II Directive (Directive 2014/65/EU): Article 16(6) and 16(7) Requests Increasing?
Over the past 12 months, there has been a marked increase in RTS 24 and MIFIR Annex IV requests from regulators across the UK and EU. This uptick stems from heightened regulatory scrutiny following notable compliance breaches and a push for better data governance.
Key drivers include:
- Increased enforcement actions by regulators like FCA, AMF, BoI, CSSF etc..
- Greater emphasis on data integrity, audit trails, and reporting accuracy.
- Widespread adoption of data analytics by regulators to flag discrepancies.
A 2024 review by ESMA revealed persistent issues in data completeness and timeliness, which has prompted a more proactive approach to onsite inspections and data requests.
🔗 ESMA’s MiFID II Compliance Review
What are key challenges firms are facing in Record Keeping?
Firms have multitude of challenges with Record Keeping, namely:
- Data Fragmentation and Inconsistent Formats: Orders and execution data are spread across multiple front-office systems with different formats, misaligned with regulatory specifications.
- Non-Compliant Storage and Lack of Audit Trails: Tactical solutions like CSV files and Access databases are non-compliant (e.g., no WORM format) and lack proper audit trails for regulatory traceability.
- Slow Response to Regulatory Requests: Collating and transforming data into regulatory format can take months due to fragmented systems and inconsistent data structures.
- Poor Data Quality and Oversight: Lack of structured controls and assurance leads to inaccurate data and poor-quality regulatory responses.
- Scalability and Performance Issues: Tactical solutions struggle with increasing trade volumes, leading to processing delays and reporting failures.
- Complex and Evolving Regulatory Requirements: Varying reporting formats and validation rules across different sections of MiFID II regulation increase the complexity of maintaining compliance.
Consequences of Poor Record-Keeping
Firms that cannot meet RTS 24 and MIFIR Annex IV requests face significant risks, including:
- Regulatory fines in the millions for non-compliance
- Costly and resource-intensive remediation efforts
- Loss of client trust and reputational damage
- Potential licensing restrictions or suspension
Recent cases highlight that regulators are unforgiving of record-keeping failures, especially when they detect repeated data inaccuracies or lack of preparedness.
How Reg-X Helps You Stay Ahead
Reg-X RegData Record-Keeping Solution Includes:
- Automated Data Capture – Using a powerful ETL, transform your orders and executions from multiple systems to regulatory compliance format and insure accuracy and reduce manual input errors.
- Secure Cloud-Based Storage – Long-term storage fully compliant with MiFID II and SEC record keeping requirements
- Rapid Data Retrieval – Easily access and respond to regulator requests in minutes, not days.
- Audit-Ready Reports – Generate regulator-ready reports instantly, ensuring full transparency.
- RegAssure™ Completeness and Accuracy Tools – Built to validate data integrity and meet complex compliance obligations.
With Reg-X, you can ensure your firm is always prepared, protected, and proactive in the face of increasing regulatory demands.
Final Thoughts: Don’t Wait for a Request
Compliance is not about reacting — it’s about being ready. With regulatory expectations rising, firms must future-proof their compliance strategy with smart, automated, and secure solutions.
Whether you’re concerned about RTS 24, MIFIR Annex IV, or other record-keeping challenges, Reg-X is here to streamline your processes, reduce risks, and keep you ahead of the compliance curve.
Get in Touch Today
Ready to simplify your compliance? Contact us for a free demo and discover how Reg-X can safeguard your firm against record-keeping risks.
