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MiFID activities, services and exemptions 

01 December 2011

Impact Amber traffic light Low/medium impact

Other areas to consider

Commodities; Best Interests of Clients

Current MiFID rules

MiFID services and activities

MiFID applies in relation to the MiFID investment services and activities listed in Section A of Annex I to MiFID (including, for example, dealing on own account and reception and transmission of orders) and carried on with respect to financial instruments listed in Section C of Annex I to MiFID (for example, including transferable securities and derivatives).


MiFID provides for a number of specific exemptions from its scope. The exemptions apply either to persons of particular descriptions or to persons carrying on certain limited activities and include exemptions for:

  • EU insurers and reinsurers
  • persons who provide MiFID investment services and activities exclusively for their parent undertakings, for their subsidiaries or for other subsidiaries of their parent undertakings.

MiFID also provides that a Member State may choose not to apply MiFID to any person for which it is the home Member State (the “Optional Exemption”) where that person is not allowed to provide MiFID investment services and activities except the reception and transmission of orders in transferable securities and units in collective investment undertakings and the provision of investment advice in relation to such financial instruments (and fulfils certain other conditions).

MiFID Level 1 Directive Arts: 2, 3, section A of Annex I to MiFID, Section C of Annex I to MiFID

FSA rules

Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 SI2001/544

Proposed changes
Draft Directive
Recitals (26) (27) (30)Article 1 (3)
Article 3 (1)
Article 4 (4)

Services and Activities

To ensure a consistent regulatory approach to distributing products to investors, the Commission in the draft Directive is proposing to:

  • extend MiFID to cover the sale of structured deposits by credit institutions;
  • clarify that MiFID applies to investment firms and credit institutions selling their own securities (as issuer);
  • clarify that MiFID applies when firms sell products to investors (when acting on behalf of issuers) (by amending the definition of “Execution of orders on behalf of clients” to include this activity).

Optional Exemptions

To ensure that investors receive the same level of protection irrespective of the location or the nature of the service providers, limit the Optional Exemption and oblige member states to apply to exempted persons requirements analogous to the MiFID (i) conduct of business rules for investment advice, (ii) authorisation requirements, and further by ensuring that they are covered by an appropriate recognised investor compensation scheme.

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