On 13 October 2010, CESR published its advice on client categorisation in the context of the European Commission’s review of the Markets in Financial Instruments Directive (2004/39/EC) (“MiFID”).

In the technical advice, CESR concludes that the MiFID rules on client categorisation are generally appropriate and do not need significant change but recommends some minor changes intended to clarify:  

  • The range of entities that fall within certain categories of clients specified as ‘per se professional clients’ in Annex II of MiFID.  
  • For the purposes of the definition of per se professional clients and per se eligible counterparties (“ECPs”), the reference in MiFID to regional governments and public debt bodies includes local authorities.  
  • When dealing with ECPs, firms must act honestly, fairly and professionally and communicate in a way that is fair, clear and not misleading.