Financial Services & Fintech

Update on MiFID II and MiFIR

26 May 2014

2 min read

ESMA, the European Securities and Markets Authority issued consultation documents for the implementation of the revised Markets in Financial Instruments Directive (MiFID II) and Regulation (MiFIR) on 22nd May 2014. This is the first stage in the process of translating the MiFID II/MiFIR requirements into practically applicable rules and regulations to address the effects of the financial crisis and to improve financial market transparency and strengthen investor protection.

MiFID II/MiFIR introduce changes that will largly impact the EU’s financial markets, including transparency requirements for a broader range of asset classes; the obligation to trade derivatives on-exchange; requirements on algorithmic and high-frequency-trading and new supervisory tools for commodity derivatives. It is envisaged that it will also strengthen protection for retail investors through limits on the use of commissions; conditions for the provision of independent investment advice; stricter organisational requirements for product design and distribution; product intervention powers; and the disclosure of costs and charges.

Over 100 requirements within MiFID II/MiFIR are required for ESMA to draft Regulatory Technical Standards (RTS) and Implementing Technical Standards (ITS), and to provide Technical Advice to the European Commission to allow it to adopt delegated acts.

In order to ensure that MIFID II achieves its objectives in practice, ESMA is publishing the following documents:

  1. Consultation Paper on MiFID/MiFIR Technical Advice
  2. Discussion Paper on MiFID/MiFIR draft RTS/ITS

These publications will be of interest to all stakeholders involved in the securities markets, in particular to investment firms and credit institutions performing investment services and activities. The closing date for responses to both papers is Friday 1 August 2014.

Should you require any further information in relation to MiFID II/MiFIR, kindly contact GVZH here.


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