ESMA has published a consultation and a discussion paper on MiFID/MiFIR. This is the first step in the process of translating the MiFID II/MiFIR requirements into practically applicable rules and regulations to address the effects of the financial crisis and to improve financial market transparency and strengthen investor protection.

MiFID II/MiFIR introduces changes that will have a large impact on the EU’s financial markets including transparency requirements for a broader range of asset classes; the obligation to trade derivatives on-exchange; requirements on algorithmic and high-frequency-trading and new supervisory tools for commodity derivatives. It will also strengthen protection for retail investors through limits on the use of commissions; conditions for the provision of independent investment advice; stricter organisational requirements for products design and distribution; product intervention powers and the disclosure of costs and chargers.

In order to ensure that MiFID II achieves its objects in practice, ESMA has published the following documents:

  • Consultation Paper on MiFID/MiFIR Technical Advice;
  • Discussion Paper on MiFID/MiFIR Draft RTS/ITS. This will provide the basis for a further consultation on the draft RTS/ITS which is expected to be issued in late 2014/early 2015.

The closing date for responses to both papers is Friday 1 August 2014.