MiFID -- An Introduction

July 15, 2005


Paris, France 15 July 2005

The European Union's Markets in Financial Services Directive (MiFID) involves the most far-reaching reform of any major financial market ever undertaken. As a result of this new legislation, Celent estimates that investment firms will be able to significantly increase their revenues.

In a new report, " ," Celent outlines the major changes in regulation that MiFID seeks to achieve. More importantly, the report analyses the impact and implications of MiFID in terms of the structure of the European financial markets, including an analysis of changes in the areas of market data, order execution policies, liquidity fragmentation and best execution requirements.

According to Octavio Marenzi, co-author of the report, "European investment firms remain woefully unprepared for MiFID. Many are totally unaware of the contents and direction of the directive, and virtually none have taken any concrete steps to prepare themselves for the new structure of European capital markets that MiFID will give rise to. Rather than simply being a regulatory compliance exercise, MiFID gives rise to myriad new business opportunities for investment firms."

The major changes in regulation that MiFID seeks to achieve will be discussed at an upcoming roundtable hosted by Celent on November 29, 2005 at the Le Ritz Paris. Click here for additional information on this event.

A table of contents is available online.

of Celent's Securities and Investmentsresearch services can download the report electronically by clicking on the icon to the left.  Non-members should contact info@celent.com for more information.


Send mail to info@celent.com with questions or comments about this Web site.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned operating unit of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
Tel: +1 212 345 1366

Europe (London)
Chris Williams
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
Tel.: +81 3 3500 3023

Table of Contents


Paris, France 15 July  2005

MiFID - An Introduction

Return to report Abstract

Executive Summary 3
Introduction 4
  Time Line 5
Major Articles in MiFID 6
  Article 19 - Conduct of Business 6
  Article 21 - Best Execution 7
  Article 22 - Client Order Handling 7
  Article 27 - Firm Public Quotes 7
  Article 28 - Post-Trade Disclosure 8
  Article 69 - End of Concentration Rules  9
Market Structure Implications 11
  Pre-Trade Reference Price 11
  Post-Trade Market Data 12
  Rise of MTFS? 14
  Crossed and Locked Markets 15
Measuring Execution Quality 17
  Fill Rate 17
  Speed 17
  Price Improvement 18
  Spread 19
Business Implications 21
I.T. Impact 23
Conclusions 27



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