Mifid II: widening the net

Author: | Published: 24 Feb 2014

Recently announced EU reforms introduce yet another set of compliance considerations for traders, and the possibility of greater regulatory intervention

On January 14 2014, the European Parliament and European Council reached agreement in principle on the revised Markets in Financial Instrument Directive (Mifid II). The announcement signaled an important milestone in a long and difficult road to a major overhaul of a pillar of the EU financial regulatory framework.

Mifid II will mark a significant change in the mindset of EU regulatory authorities. Its scope will be expanded to cover a greater range of products and entities, there will be a much greater focus on investor protection, and a more intrusive and interventionist approach to regulation. There will also be significant changes affecting organised trading of financial instruments, pre- and post-trade transparency (among other aspects of market infrastructure), and a greater focus on enforcement and supervision by national regulators.