MiFID: The markets in financial instruments directive
MiFID is a complete rewrite and updating of the Investment Services Directive (ISD). In areas already covered by the ISD it introduces greater detail, clarity and prescription. It also covers new areas of business, so commodities and derivatives of all forms are legislated for, and investment advice is now a core activity, previously it was ancillary.
The Directive is intended to have a substantial procompetition effect in equity markets. The new Directive thus has a substantial and pervasive effect on all financial businesses not regulated as credit institutions or insurance companies, but may well impact parts of their business too. In the UK the greatest impacts will probably be in equity market structures and the financial advice market.
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