What is MiFID and what is its purpose?

MiFID stands for the "Markets in Financial Instruments Directive". This directive is a key part of a package of European Union laws aimed at creating a single, more transparent market in financial services across all EU member states. In particular, MiFID aims to harmonise the rules governing the activities of financial services firms, to promote easier cross border business, increase market transparency and improve investor protection. It replaces the Investment Services Directive (ISD), which has been in place since 1995.

National authorities within the EU are required to implement MiFID in their respective countries with effect from 1 November 2007. To this end, Cyprus introduced legislation to implement Directive 2004/39/EC of the European Parliament and of the Council on Markets in Financial Instruments and Directive 2006/31/EC of the European Parliament and of the Council of 5th April, 2006. The relevant legislation is the Investment Services and Activities and Regulated Markets Law of 2007, number 144(1) of 2007, which was passed by the Cyprus House of Representatives on 25th October, 2007, replacing the previous Investment Firms Law of 2002 with effect from 1st November, 2007.