MIFID

Regulation and MIFID

MiFID stands for the Market in Financial Instruments Directive. It is a new EU Directive which came into effect on November 1st 2007.

It is a comprehensive piece of legislation which sets out a standardised regulatory regime covering investment services and financial markets in Europe.

It contains measures which are designed to improve the organisation and functioning of investment firms, facilitate cross border trading and thereby encourage the integration of EU capital markets.

MiFID will apply strong standards of legislation to all EU financial services firms which will now be competing on an international scale with cost and service benefits for consumers.

FAQ

To whom does the Directive apply?

MiFID applies to all firms that provide investment services. These services include share dealing, the provision of investment advice or managing investments on a discretionary basis. Investment firms all across Europe , such as private banks, stockbrokers and investment managers, must meet the requirements.

What will MiFID mean for you?

MiFID is good news for consumers. Its main goal is to promote the emergence of an efficient, transparent and integrated financial trading infrastructure, ensuring a higher degree of investor protection. This means a greater choice of investment service providers who will all be required to conform to high standards of behaviour for their clients. Firms will be subject to increased competition forcing them to be more responsive regarding their clients and to offer a better level of service. When executing client orders, firms will have to take all reasonable steps to deliver the best possible result for their clients.

How will MiFID affect you?

We envisage that MiFID will not impact on your day to day dealings with Cantor Fitzgerald and the way we currently provide investment services to you. We must hold information on file for you in order to provide you with the most suitable products and advice. Each service that is provided to you must be suitable for you and in accordance with your personal details and investment objectives. You may also note some changes and additional information on your contract notes.

The changes implemented by the new regulations require us to disclose the following information to you:

Client Categorisation

Following the implementation of MiFID we are required to classify each of our clients into one of three categories: Retail Client, Professional Client or Eligible Counterparty. Retail applies to private investors; Professional applies to experienced investors with substantial investment experience; Eligible Counterparties is applicable to market participants, such as other investment firms or stockbrokers.

Your client categorisation determines the level of protection under MiFID. It determines your rights and obligations when dealing with Cantor Fitzgerald.

Retail clients are awarded the highest level of protection.

It is possible for more experienced investors with assets in excess of €500,000 and relevant investment experience to request categorisation as a “professional client”. This categorisation is only suited to individuals who are highly experienced and knowledgeable and who can assume the risks associated with their investment decisions. Cantor Fitzgerald will use its discretion when requested to amend a client’s categorisation. This decision will be made in accordance with the best interest of the client and what we believe is the most suitable category for that client. We are not obliged to amend a client category should we deem it unsuitable.

Terms of Business

Our Terms of Business relevant to your account are available for you to view on our website.

Order Execution Policy

MiFID requires us as an investment firm to provide you with best execution when transacting orders on your behalf. Our order execution policy is available on line for viewing.

Conflicts of Interest Policy

MiFID also requires that Cantor Fitzgerald disclose the arrangements we operate in order to prevent conflicts of interest which could result in a loss to our clients. The purpose of the conflicts of interest policy is to outline how Cantor Fitzgerald manages conflicts in our business.

What do I do and where can I go if I have questions?

If you have any further questions relating to MiFID please contact your usual point of contact in Cantor or alternatively please speak to our Client Services Department on 01- 6333888 during the hours of 9am and 6pm, Monday to Friday.