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The MiFID metamorphosis: A new paradigm for market structure
Journal of Securities Operations & Custody,
3
(4),
317-332
(2011)
Abstract
Assessing the Markets in Financial Instruments Directive (MiFID), adopted in April 2004 and implemented at Member State level by the end of 2007, this paper finds that the legislation has been remarkably successful in terms of improving market structure and efficiency. In the authors’ view, the upcoming MiFID review should therefore take a ‘light touch’, clarifying some definitions and extending the transparency regime to non-equity markets. They argue that easier and cheaper access to consolidated data solutions will also allow end-users to fully participate in the changes brought about by MiFID, ultimately restoring investors’ trust and pushing more liquidity in equity markets. The start of the European Security and Markets Authority (ESMA) then should allow for better enforcement of the conduct of business rules. The report aims at assessing the state of European equity markets after the introduction of MiFID, merging fundamental changes in securities regulation with insights of economic theory, competition policy and European policies.
Keywords: capital markets; securities regulation; MiFID; best execution; market structure; data consolidation; trading venues
The full article is available to subscribers to the journal.
Author's Biography
Karel Lannoo is Chief Executive of the Centre for European Policy Studies (CEPS) since 2000 and Senior Research Fellow since 1997. CEPS is one of the leading independent European think tanks, with a strong reputation in economic and foreign policy research. Karel has published some books and numerous articles in specialist magazines and journals on general European policy, and specifically financial regulation and supervision matters. He has spoken at several European Parliament, Commission and related institutions’ hearings and also participated in studies for national and international bodies (EU institutions, OECD, ADB, World Bank). Karel is a regular speaker at international gatherings and in executive programmes. Before joining CEPS, he was employed in the cultural sector, worked for the Italian conglomerate Ferruzzi and for a professional federation. Karel was also active as a freelance writer for several specialist financial sector publications. He holds a baccalaureate in philosophy and an MA in history from the University of Leuven, Belgium (1985) and obtained a postgraduate in European studies (CEE) from the University of Nancy, France (1986). Karel is an independent director of Bolsas Y Mercados Espanoles (BME), the company that runs the Madrid stock exchange. He also directs the European Capital Markets Institute (ECMI) and the European Credit Research Institute (ECRI), both separate legal entities that are managed by CEPS.
Diego Valiante PhD is a Research Fellow at ECMI and CEPS since March 2009. He holds a BSc in Economics and an MSc in Law and Economics from LUISS — Guido Carli University in Rome. Diego also holds an LL.M. Master in Law and Economics from the University of Hamburg. and, in 2010, he earned a PhD in Law and Economics from LUISS University. As a result of his interdisciplinary education, Diego’s main research areas are in financial and secu - rities regulation and markets, as well as competition law and policy, corporate governance and economics. He has published commentaries for a notable Italian law review, and papers on financial markets, services and regulation. Diego is currently involved in working groups on major aspects of European capital markets and is often invited to speak at events and provide lectures on economic and regulatory issues of capital markets and financial regulation. Before joining CEPS and ECMI, he also worked as an intern in the public authorities division of a major investment bank in Canary Wharf, London.
