Markets in Financial Instruments Directive – Directive 2014/65/EU

Scope

and definitions — Art. 1 MiFID II — Scope 1. This Directive shall apply to investment firms, market operators, and third-country firms providing investment…

Exemptions

1. This Directive shall not apply to: (a) insurance undertakings or undertakings carrying out the reinsurance and retrocession activities referred to in…

Optional exemptions

1. Member States may choose not to apply this Directive to any persons for which they are the home Member State, provided that the activities of those persons…

Definitions

1. For the purposes of this Directive, the following definitions apply: (1) ‘investment firm’ means any legal person whose regular occupation or business is…

Requirement for authorisation

1. Each Member State shall require that the provision of investment services and/or the performance of investment activities as a regular occupation or…

Scope of authorisation

1. The home Member State shall ensure that the authorisation specifies the investment services or activities which the investment firm is authorised to…

Procedures for granting and refusing requests for authorisation

1. The competent authority shall not grant authorisation unless and until such time as it is fully satisfied that the applicant complies with all requirements…

Withdrawal of authorisations

The competent authority may withdraw the authorisation issued to an investment firm where such an investment firm: (a) does not make use of the authorisation…

Management body

1. Competent authorities granting the authorisation in accordance with Article 5 shall ensure that investment firms and their management bodies comply with…

Shareholders and members with qualifying holdings

1. The competent authorities shall not authorise the provision of investment services or performance of investment activities by an investment firm until they…

Notification of proposed acquisitions

1. Member States shall require any natural or legal person or such persons acting in concert (the ‘proposed acquirer’), who have taken a decision either to…

Assessment period

1. The competent authorities shall, promptly and in any event within two working days following receipt of the notification required under the first…

Assessment

1. In assessing the notification provided for in Article 11(1) and the information referred to in Article 12(2), the competent authorities shall, in order to…

Membership of an authorised investor compensation scheme

The competent authority shall verify that any entity seeking authorisation as an investment firm meets its obligations under Directive 97/9/EC at the time of…

Initial capital endowment

Member States shall ensure that the competent authorities do not grant authorisation unless the investment firm has sufficient initial capital in accordance…

Organisational requirements

1. The home Member State shall require that investment firms comply with the organisational requirements laid down in paragraphs 2 to 10 of this Article and in…

Exemptions from product governance requirements

An investment firm shall be exempted from the requirements set out in the second to fifth subparagraphs of Article 16(3) and in Article 24(2), where the…

Algorithmic trading

1. An investment firm that engages in algorithmic trading shall have in place effective systems and risk controls suitable to the business it operates to…

Trading process and finalisation of transactions in an MTF and an OTF

1. Member States shall require that investment firms and market operators operating an MTF or an OTF, in addition to meeting the organisational requirements…

Specific requirements for MTFs

1. Member States shall require that investment firms and market operators operating an MTF, in addition to meeting the requirements laid down in Articles 16…

Specific requirements for OTFs

1. Member States shall require that an investment firm and a market operator operating an OTF establishes arrangements preventing the execution of client…

Regular review of conditions for initial authorisation

1. Member States shall require that an investment firm authorised in their territory comply at all times with the conditions for initial authorisation…

General obligation in respect of on-going supervision

Member States shall ensure that the competent authorities monitor the activities of investment firms so as to assess compliance with the operating conditions…

Conflicts of interest

1. Member States shall require investment firms to take all appropriate steps to identify and to prevent or manage conflicts of interest between themselves…

General principles and information to clients

1. Member States shall require that, when providing investment services or, where appropriate, ancillary services to clients, an investment firm act honestly…

Assessment of suitability and appropriateness and reporting to clients

1. Member States shall require investment firms to ensure and demonstrate to competent authorities on request that natural persons giving investment advice or…

Provision of services through the medium of another investment firm

Member States shall allow an investment firm receiving an instruction to provide investment or ancillary services on behalf of a client through the medium of…

Obligation to execute orders on terms most favourable to the client

1. Member States shall require that investment firms take all sufficient steps to obtain, when executing orders, the best possible result for their clients…

Client order handling rules

1. Member States shall require that investment firms authorised to execute orders on behalf of clients implement procedures and arrangements which provide for…

Obligations of investment firms when appointing tied agents

1. Member States shall allow an investment firm to appoint tied agents for the purposes of promoting the services of the investment firm, soliciting business…

Services provided to professional clients

1. The requirements laid down in point (c) of Article 24(4) shall not apply to services provided to professional clients except for investment advice and…

Transactions executed with eligible counterparties

1. Member States shall ensure that investment firms authorised to execute orders on behalf of clients, and/or to deal on own account, and/or to receive and…

Monitoring of compliance with the rules of the MTF or the OTF and with other legal obligations

1. Member States shall require that investment firms and market operators operating an MTF or OTF establish and maintain effective arrangements and procedures…

Suspension and removal of financial instruments from trading on an MTF or an OTF

1. Without prejudice to the right of the competent authority under Article 69(2) to demand suspension or removal of a financial instrument from trading, an…

SME growth markets

— Art. 33 MiFID II — SME growth markets 1. Member States shall provide that the operator of an MTF may apply to its home competent authority to have the MTF…

Freedom to provide investment services and activities

1. Member States shall ensure that any investment firm authorised and supervised by the competent authorities of another Member State in accordance with this…

Establishment of a branch

1. Member States shall ensure that investment services and/or activities as well as ancillary services may be provided within their territories in accordance…

Access to regulated markets

1. Member States shall require that investment firms from other Member States which are authorised to execute client orders or to deal on own account have the…

Access to CCP, clearing and settlement facilities and right to designate settlement system

1. Without prejudice to Titles III, IV or V of Regulation (EU) No 648/2012, Member States shall require that investment firms from other Member States have the…

Provisions regarding CCPs, clearing and settlement arrangements in respect of MTFs

1. Member States shall not prevent investment firms and market operators operating an MTF from entering into appropriate arrangements with a CCP or clearing…

Establishment of a branch

1. A Member State may require that a third-country firm intending to provide investment services or perform investment activities with or without any ancillary…

Obligation to provide information

A third-country firm intending to obtain authorisation for the provision of any investment services or the performance of investment activities with or without…

Granting of the authorisation

1. The competent authority of the Member State where the third‐country firm has established or intends to establish its branch shall only grant authorisation…

Provision of services at the exclusive initiative of the client

1. Member States shall ensure that where a retail client or professional client within the meaning of Section II of Annex II established or situated in the…

Withdrawal of authorisations

— Art. 43 MiFID II — Withdrawal of authorisations The competent authority which granted an authorisation under Articles 41 may withdraw the authorisation…

Authorisation and applicable law

1. Member States shall reserve authorisation as a regulated market to those systems which comply with this Title. Authorisation as a regulated market shall be…

Requirements for the management body of a market operator

1. Member States shall require that all members of the management body of any market operator shall at all times be of sufficiently good repute, possess…

Requirements relating to persons exercising significant influence over the management of the regulated market

1. Member States shall require the persons who are in a position to exercise, directly or indirectly, significant influence over the management of the…

Organisational requirements

1. Member States shall require the regulated market: (a) to have arrangements to identify clearly and manage the potential adverse consequences, for the…

Systems resilience, circuit breakers and electronic trading

1. Member States shall require a regulated market to establish and maintain its operational resilience in accordance with the requirements laid down in Chapter…

Tick sizes

1. Member States shall require regulated markets to adopt tick‐size regimes in shares, depositary receipts, exchange‐traded funds, certificates and other…

Admission of financial instruments to trading

1. Member States shall require that regulated markets have clear and transparent rules regarding the admission of financial instruments to trading. Those rules…

Specific conditions for the admission of shares to trading

1. Member States shall ensure that regulated markets require that the foreseeable market capitalisation of the company for whose shares admission to trading is…

Suspension and removal of financial instruments from trading on a regulated market

1. Without prejudice to the right of the competent authority under Article 69(2) to demand suspension or removal of a financial instrument from trading, a…

Access to a regulated market

1. Member States shall require a regulated market to establish, implement and maintain transparent and non-discriminatory rules, based on objective criteria…

Monitoring of compliance with the rules of the regulated market and with other legal obligations

1. Member States shall require that regulated markets establish and maintain effective arrangements and procedures including the necessary resource for the…

Provisions regarding CCP and clearing and settlement arrangements

1. Without prejudice to Titles III, IV or V of Regulation (EU) No 648/2012, Member States shall not prevent regulated markets from entering into appropriate…

List of regulated markets

Each Member State shall draw up a list of the regulated markets for which it is the home Member State and shall forward that list to the other Member States…

Position limits in commodity derivatives and position management controls in commodity derivatives and derivatives of emission allowances

1. Member States shall ensure that competent authorities, in line with the calculation methodology determined by ESMA in the regulatory technical standards…

Position reporting by categories of position holders

1. Member States shall ensure that an investment firm or a market operator operating a trading venue which trades in commodity derivatives or in derivatives of…

Designation of competent authorities

1. Each Member State shall designate the competent authorities which are to carry out each of the duties provided for under the different provisions of…

Cooperation between authorities in the same Member State

If a Member State designates more than one competent authority to enforce a provision of this Directive or of Regulation (EU) No 600/2014, their respective…

Supervisory powers

1. Competent authorities shall be given all supervisory powers, including investigatory powers and powers to impose remedies, necessary to fulfil their duties…

Sanctions for infringements

1. Without prejudice to the supervisory powers including investigatory powers and powers to impose remedies of competent authorities in accordance with Article…

Publication of decisions

1. Member States shall provide that competent authorities publish any decision imposing an administrative sanction or measure for infringements of Regulation…

Exercise of supervisory powers and powers to impose sanctions

1. Competent authorities shall exercise the supervisory powers including, investigatory powers and powers to impose remedies, referred to in Article 69 and the…

Reporting of infringements

1. Member States shall ensure that competent authorities establish effective mechanisms to enable reporting of potential or actual infringements of the…

Right of appeal

1. Member States shall ensure that any decision taken under the provisions of Regulation (EU) No 600/2014 or under laws, regulations or administrative…

Extra-judicial mechanism for consumers complaints

1. Member States shall ensure the setting-up of efficient and effective complaints and redress procedures for the out-of-court settlement of consumer disputes…

Professional secrecy

1. Member States shall ensure that competent authorities, all persons who work or who have worked for the competent authorities or entities to whom tasks are…

Relations with auditors

1. Member States shall provide, at least, that any person authorised within the meaning of Directive 2006/43/EC of the European Parliament and of the Council…

Data protection

The processing of personal data collected in or for the exercise of the supervisory powers including investigatory powers in accordance with this Directive…

Obligation to cooperate

1. Competent authorities of different Member States shall cooperate with each other where necessary for the purpose of carrying out their duties under this…

Cooperation between competent authorities in supervisory activities, for on-site verifications or investigations

1. A competent authority of one Member State may request the cooperation of the competent authority of another Member State in a supervisory activity or for an…

Exchange of information

1. Competent authorities of Member States having been designated as contact points for the purposes of this Directive and of Regulation (EU) No 600/2014 in…

Binding mediation

1. The competent authorities may refer to ESMA situations where a request relating to one of the following has been rejected or has not been acted upon within…

Refusal to cooperate

A competent authority may refuse to act on a request for cooperation in carrying out an investigation, on-the-spot verification or supervisory activity as…

Consultation prior to authorisation

1. The competent authorities of the other Member State involved shall be consulted prior to granting authorisation to an investment firm which is any of the…

Powers for host Member States

1. Host Member States shall provide that the competent authority may, for statistical purposes, require all investment firms with branches within their…

Precautionary measures to be taken by host Member States

1. Where the competent authority of the host Member State has clear and demonstrable grounds for believing that an investment firm acting within its territory…

Cooperation and exchange of information with ESMA

1. The competent authorities shall cooperate with ESMA for the purposes of this Directive, in accordance with Regulation (EU) No 1095/2010. 2. The competent…

Accessibility of information on the European single access point

1. From 10 January 2030, Member States shall ensure that, when making public any information referred to in Article 27(3) and (6), Article 33(3), points (c)…

Exchange of information with third countries

1. Member States and in accordance with Article 33 of Regulation (EU) No 1095/2010, ESMA, may conclude cooperation agreements providing for the exchange of…

Exercise of the delegation

1. The power to adopt delegated acts is conferred on the Commission subject to the conditions laid down in this Article. 2. The delegation of power referred to…

Committee procedure

1. The Commission shall be assisted by the European Securities Committee established by Commission Decision 2001/528/EC (18). That committee shall be a…

Reports and review

1. Before 3 March 2020 the Commission shall, after consulting ESMA, present a report to the European Parliament and the Council on: (a) the functioning of…

Amendments to Directive 2011/61/EU

Directive 2011/61/EU is amended as follows: (1) in point (r) of Article 4(1), the following point is added: ‘(vii) a Member State, other than the home Member…

Transposition

1. Member States shall adopt and publish, by 3 July 2017, the laws, regulations and administrative provisions necessary to comply with this Directive. They…

Repeal

Directive 2004/39/EC, as amended by the acts listed in Annex III, Part A of this Directive, is repealed with effect from 3 January 2018, without prejudice to…

Transitional provisions

1. Until 3 January 2021: (a) the clearing obligation set out in Article 4 of Regulation (EU) No 648/2012 and the risk mitigation techniques set out in Article…

Transitional provision on the authorisation of credit institution referred to in point (1)(b) of Article 4(1) of Regulation (EU) No 575/2013

Competent authorities shall inform the competent authority referred to in Article 8 of Directive 2013/36/EU where the envisaged total assets of an undertaking…

Entry into force

This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

Addressees

This Directive is addressed to the Member States.