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Published]","attribution":{"prepared_by":"ESMA","published_by":"ESMA","published_in":"ESMA Q&A tool","document_type":"qa_answer","legal_nature":"not_legislation","addressees":"not stated in the document","dates":{"published_on":"2017-11-10","question_submitted_on":"2017-11-10","locators":{"published_on":"ESMA Q&A Excel export ESMA_QA_1857, column 'Esma responses', date line","question_submitted_on":"ESMA Q&A Excel export ESMA_QA_1857, column 'Date of submission'"}},"adoption":null}},"provenance":{"official_url":"https://www.esma.europa.eu/publications-data/questions-answers/1857","check":{"result":"matched","checked_at":"2026-10-26","against":"the ESMA publication"},"repo_path":"spaces/mifid-ii/level-3/q-and-a/esma/esma-qa-1857-inducements.md","body_sha256":"2d2ded9d1fa738107d71c52132388052ad06373d7f0ccb57979ae326ee3bb9f0"},"units":[],"markdown":"---\ntitle: \"ESMA Q&A 1857 — Q&A — Inducements [Answer Published]\"\nshortTitle: \"ESMA Q&A 1857 — Q&A — Inducements [Answer Published]\"\nanswer_id: ESMA_QA_1857\ntopic: \"Inducements (research)\"\nstatus: \"Answer Published\"\ntype: qa\ninstrument_type: qa\nauthority: ESMA\nbinding: false\nbinding_character: non_binding\nlegal_status: in_force\nregulation: \"MiFID II\"\nmifid_level3: true\nmica_level2: false\nlegal_basis: \"MiFID II\"\ndate: 10 November 2017\nsource_link: https://www.esma.europa.eu/publications-data/questions-answers/1857\nlifecycle: \"Answer Published\"\ntext_version: \"ESMA Q&A register, 10 November 2017\"\nsource_url: \"https://www.esma.europa.eu/publications-data/questions-answers/1857\"\ncheck_status: matched\nverified: true\nlast_checked: 2026-10-26\nchecked_against: \"the ESMA publication\"\nsource:\n  prepared_by: \"ESMA\"\n  published_by: \"ESMA\"\n  published_in: \"ESMA Q&A tool\"\n  evidence:\n    prepared_by: \"ESMA Answer\"\n    locator: \"ESMA Q&A entry ESMA_QA_1857: field 'ESMA Answer', no 'Answer provided by' line\"\ndocument_type: \"qa_answer\"\nlegal_nature: \"not_legislation\"\naddressees: \"not stated in the document\"\ndates:\n  published_on: \"2017-11-10\"\n  question_submitted_on: \"2017-11-10\"\n  locators:\n    published_on: \"ESMA Q&A Excel export ESMA_QA_1857, column 'Esma responses', date line\"\n    question_submitted_on: \"ESMA Q&A Excel export ESMA_QA_1857, column 'Date of submission'\"\nlifecycle_label: \"Answer Published\"\n---\n\n**Answer by ESMA, published in its Q&A tool · not legislation · published 10 Nov 2017 [Answer Published]**\n\n*Answer Published · ESMA Q&A register, 10 November 2017 · Checked against the ESMA publication on 26 Oct 2026 · [Official source](https://www.esma.europa.eu/publications-data/questions-answers/1857)*\n\n| | |\n|---|---|\n| **Full title** | ESMA Q&A 1857 — Q&A — Inducements \\[Answer Published\\] |\n| **Prepared by** | ESMA |\n| **Published by** | ESMA, in the ESMA Q&A tool |\n| **Reference** | ESMA_QA_1857 |\n| **Document type** | Q&A |\n| **Legal nature** | Not legislation |\n| **Addressees** | Not stated in the document |\n| **Dates** | Published 10 November 2017; question submitted 10 November 2017 |\n| **Legal basis** | MiFID II |\n| **Related instruments** | None recorded |\n| **Text on this page** | Word for word — the full text of the ESMA publication |\n\n**Inducements**\n\n### Question\n\nIn connection with an investment firm providing investment advice on an independent basis or portfolio management services, what is, with a perspective on Chapter II of the implementing directive,the legal status of a fee, commission or monetary benefit, after it has been received by an investment firm from a third party or a person acting on behalf of a third party as an inducement, and prior to it being transferred in full by the investment firm to the client?\n\n***\n\n### Answer\n\n\\[ESMA 35-43-349 MiFID II Q&As on Investor protection Ch. 12, question 2\\]\n\nArticle 12(1) of the MiFID II Delegated Directive requires that all fees, commissions or any monetary benefits received from a third party, or person acting on behalf of a third party, in relation to the provision of independent investment advice or portfolio management shall be transferred in full to the client. Once it is received by an investment firm from a third party or a person acting on behalf of a third party, and prior to the transfer to the client, the fee, commission or monetary benefit should be considered a liability of the investment firm, which is subject to the obligation in Article 12(1) of the MiFID II Delegated Directive to return the money to the client “as soon as reasonably possible after receipt”.\n\nThe terms of business and/or contractual arrangements in place between the investment firm and a client should document how inducements are treated by the investment firm, including how the regulatory obligation to transfer such money to a client is discharged and the status of fees, commissions or monetary fees in case of insolvency. Such arrangements should provide for the transfer of the inducement by transferring to a client asset account, if the client holds a client asset account with the investment firm, or provide for some other means, such as, by cheque or bank transfer to the client’s account held externally. In any event, an investment firm must have systems and controls in place to transfer the money to the client as soon as reasonably possible after receipt. As set out in Recital 74 of MiFID II, an investment firm is not permitted to offset the inducement from any fees owed by the client to the firm.\n\n***\n\n**Source:** [ESMA original document](https://www.esma.europa.eu/publications-data/questions-answers/1857)\n"}