Purpose of MiFID

The regulatory frameworks for investment service providers has been significantly revised by the European authorities, in response to the 2008 financial crisis, driven by a double purpose to improve the transparency of financial markets and to increase the investors protection.
For transactions on financial markets, the measures introduced by the regulations aim to limit the opacity of markets, regardless of the products traded (shares, bonds, derivatives). Pre- and post-trade transparency is thus at the center of the device, materialized by higher requirements in terms of publication of transactions and reporting to supervisors.

In this post-crisis context, investor protection remains a priority. Measures to provide clients with standardized and detailed information, ex ante and ex post, on costs and charges are a key element of the recently implemented devices. The introduction of a product governance and client knowledge system within the organizations, which aims to offer clients the best product for their profile, its needs and objectives, is also a significant progress. The rules of professional conduct aimed in particular at preventing conflicts of interest with regard to the remuneration of brokers have been significantly revised, by introducing a strict framework or even prohibitions in certain situations, thus recalling the fundamental nature of the primacy of the client’s interest.