MiFID directive
What is MiFID?
The financial services industry in the European Union is regulated by EU directives. As part of the moves towards a single European financial market, MiFID (Markets in Financial Instruments Directive) has been transposed into national law in all the EU members states since 1 November 2007.
MiFID
Markets in Financial Instruments Directive
This new directive will be applicable to all European banks and investment firms and their clients.
Purpose
The main purpose of MiFID is to increase the harmonisation of investment services and the level of investor protection within the EU. Nordea bank has always maintained high standards of consumer protection and therefore welcomed MiFID, which allows banks and investors to operate and be subject to the same rules and regulations throughout the EU.
- increase transparency of investment services;
- ensure a high level of client protection;
- define standards for the best execution of orders;
- enable investment firms to operate throughout the EU with a home-state licence (so-called EU passport);
- harmonise the organisational requirements for investment firms.
How will MiFID affect you?
Classification
To determine the level of investor protection applicable to you, Nordea will have you assigned to one of the three client categories specified in MiFID. You will be informed about the category you have been assigned.
Suitability of services provided to you
In order to invest with Nordea, you as an investor will have to provide additional information, first of all, about your experience and knowledge related to the financial instruments you invest in, your financial status, and your investment goals. This information will be used only to recommend you products and services suitable and/or appropriate to your type of business.
Clarification of instructions and contracts with the clients
To ensure greater transparency for its clients, Nordea clarified some of its activity guidelines, for example:
- we have provided a detailed description of the steps take to ensure that all necessary measures are employed to achieve the best possible result in the execution of your order.
- we have enumerated how possible conflicts of interest are determined, how they can be avoided, and how they are controlled.
- greater transparency of the services provided to you, primarily due to clearer instructions and documents;
- higher quality consulting services focusing on the specific risks related to the financial instruments that are recommended;
- better protection of your interests by ensuring that Nordea products and services are appropriate to your type of business or personal category and always adhering to the "best execution of orders" principle.