MiFID II enters into force on January 3, 2018, and is designed to reform reporting standards and inject more transparency into the European asset management sector.

First Eagle Investment Management will absorb the costs of external research once sweeping new European legislation enters into force in a few weeks’ time. 

The second iteration of the European Union’s Markets in Financial Instruments Directive, or MiFID II, will require asset managers to “unbundle” the costs of equity research, separating them from management fees.

Although First Eagle is not subject to the directive, “we believe that this part of the directive points the way forward for our industry,” said Mehdi Mahmud, president and chief executive of First Eagle Investment Management. “To be equitable and consistent across our entire client base, we have decided to use our own resources to absorb the costs of external research purchased by First Eagle investment teams for all our clients worldwide.”

MiFID II enters into force on January 3, 2018, and is designed to reform reporting standards and inject more transparency into the European asset management sector. 

The industry has generally moved towards footing the bill, as opposed to passing additional research costs onto clients. 

But it is unlikely that research will come cheap.

For example, Barclays has said its top service package from equities analysts could cost as much as $455,000, while Alliance Bernstein’s sell-side unit has quoted some firms around $150,000 a year.