Chapter 1 - MiFID

Question 1

What were the main policy goals of MiFID?

Answer 1

1. Remove cross border hurdles by not applying host state rules on incoming passporting firms.
2. Extend the range of investments for which an EU passport could be obtained for.
3. Introduce EEA investor protections.

Question 2

What were the 4 requirements MiFID introduced?

Answer 2

1. Best execution
2. Disclosure requirements
3. Client specific rules on appropriateness and suitability.
4. Rules on inducements

Question 3

Which operations could be passported under MiFID?

Answer 3

1. Receipt, transmitting and execution orders.
2. Personal Account Dealing
3. Portfolio Management
4. Investment Advice
5. Underwriting on a firm and non-firm commitment basis.
6. Operating an MTF

Question 4

What is the process the FCA takes when transferring EU legislation into UK law?

Answer 4

Discussion Paper –> Consultation Paper –> Policy Statement