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Better regulated and transparent financial markets



Directive 2014/65/EU on markets in financial instruments


  • Known as ‘MiFID II’ (markets in financial instruments directive), it aims at making financial markets in the European Union (EU) more robust and transparent.
  • It creates a new legal framework that better regulates investment and trading activities on financial markets and enhances investor protection.


1. Ensuring financial products are traded on regulated venues

The aim is to close loopholes in the structure of financial markets. A new regulated trading platform is established to capture the maximum of unregulated trades. This is the so-called organised trading facility (OTF), which will exist alongside existing trading platforms such as regulated markets.

2. Increased transparency

The rules strengthen the transparency requirements that apply before and after financial instruments are traded, for instance when market participants have to publish information regarding the prices of financial instruments. These requirements are calibrated differently depending on the type of financial instrument.

3. Limiting speculation on commodities

Speculation on commodities – a financial practice that can lead to the prices of basic products (such as agricultural products) soaring – is restricted by introducing a harmonised EU system setting limits on the positions held in commodity derivatives. National authorities may limit the size of a position that market participants can hold in commodity derivatives.

4. Adapting rules to new technologies

Under the new rules, controls must be established for trading activities that are performed electronically at a very high speed, such as high-frequency trading*. Potential risks from the increased use of technology are mitigated by a combination of rules aiming to ensure these trading techniques do not create disorderly markets.

5. Reinforcing investor protection

Investment firms should act in accordance with the best interests of their clients when providing them with investment services. These firms should safeguard their clients’ assets or ensure the products they manufacture, offer or recommend are designed to meet the needs of final clients. Investors will also be provided with increased information on products and services offered or recommended to them. Moreover, firms must ensure that staff remuneration and incentives received by or paid to the firms to recommend a particular financial product are not organised in a way that goes against clients’ interests.

Amendments to Directive 2014/65/EU

  • Directive (EU) 2019/2034 concerns the prudential supervision of investment firms and amends Directive 2014/65/EU to harmonise the required level of initial capital of investment firms operating OTFs and multilateral trading facilities* (MTFs).
  • Amendments introduced by Directive (EU) 2019/2177 transfer the competences previously granted to competent authorities to the European Securities and Markets Authority (ESMA), which becomes responsible for authorising and supervising undertakings that intend to provide data communication services.
  • Directive (EU) 2020/1504 concerns an amendment adopted in relation to Regulation (EU) 2020/1503 on crowdfunding services providers for business (see summary). To avoid a situation where the same activity is subject to multiple authorisations within the EU, legal persons authorised as crowdfunding service providers under Regulation (EU) 2020/1503 are excluded from the scope of Directive 2014/65/EU.
  • Regulation (EU) 2019/2115 introduces new rules to actively promote the use of SME growth markets, a new type of trading venue created under Directive 2014/65/EU and a subcategory of MTFs. These are designed to improve SMEs’ access to capital and enable them to grow, and to encourage the development of specialist markets catering to the needs of SME issuers with growth potential.
  • Amending Directive (EU) 2021/338 was introduced to help recovery from the COVID-19 pandemic. It simplifies the MiFID rules that appeared not useful or too burdensome, reducing, for example, the information on costs and charges to be provided to professional investors and eligible counterparties. Paper-based investment information is to be phased out, except for retail clients if they request to continue to receive it. Banks and financial firms will also be able to bundle research and execution costs in relation to research on small and mid-cap issuers. The periodic reporting due to be published by trading and execution venues and systematic internalisers* is suspended until February 2023. There are also some changes to the position limit regime for commodity derivatives to support the emergence and growth of euro-denominated commodity derivatives markets.

Delegated and implementing acts

The European Commission has adopted a series of delegated and implementing acts, including the following.

  • Delegated Directive (EU) 2017/593 as amended by Delegated Directive (EU) 2021/1269, which deals with aspects of investor protection:
    • safeguarding clients’ funds and financial instruments;
    • product governance*;
    • monetary and non-monetary compensation; and
    • integration of sustainability factors into the product governance obligations.
  • Delegated Regulation (EU) 2017/565 on organisational requirements and operating conditions for investment firms, as amended by Delegated Regulation (EU) 2021/1253 as regards the integration of sustainability factors, risks and preferences.
  • Implementing Regulation (EU) 2016/824 on technical standards for describing the functioning of MTFs and OTFs and their notification to ESMA.


It has applied since 3 January 2018 (postponed by 1 year by Directive (EU) 2016/1034) and had to become law in the Member States by 3 July 2017.


For more information, see:


High-frequency trading. A type of trading that uses computer programs to perform trades at high speed using rapidly updating financial data.
Multilateral trading facility. A facility in which multiple third-party buying and selling trading interests in financial instruments are able to interact in the system.
Systematic Internaliser (SI). SIs are investment firms which on an organised, frequent, systematic and substantial basis, deal on own account when executing client orders outside a regulated market, MTF or OTF without operating a multilateral system.
Product governance. This ensures that firms that manufacture and distribute financial instruments and structured deposits act in their clients’ best interests.


Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (recast) (OJ L 173, 12.6.2014, pp. 349–496).

Successive amendments to Directive 2014/65/EU have been incorporated in the original text. This consolidated version is of documentary value only.


Regulation (EU) 2020/1503 of the European Parliament and of the Council of 7 October 2020 on European crowdfunding service providers for business, and amending Regulation (EU) 2017/1129 and Directive (EU) 2019/1937 (OJ L 347, 20.10.2020, pp. 1–49).

Commission Delegated Directive (EU) 2017/593 of 7 April 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council with regard to safeguarding of financial instruments and funds belonging to clients, product governance obligations and the rules applicable to the provision or reception of fees, commissions or any monetary or non-monetary benefits (OJ L 87, 31.3.2017, pp. 500–517).

Commission Delegated Regulation (EU) 2017/565 of 25 April 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of that Directive (OJ L 87, 31.3.2017, pp. 1–83).

See consolidated version

Commission Implementing Regulation (EU) 2016/824 of 25 May 2016 laying down implementing technical standards with regard to the content and format of the description of the functioning of multilateral trading facilities and organised trading facilities and the notification to the European Securities and Markets Authority according to Directive 2014/65/EU of the European Parliament and of the Council on markets in financial instruments (OJ L 137, 26.5.2016, pp. 10–16).

Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/77/EC (OJ L 331, 15.12.2010, pp. 84–119).

See consolidated version.

last update 14.12.2021