Financial Intermediation

Abstract

Legislation on protection of investors against wrongful actions of financial intermediaries is considered to be one of the most important elements of EU securities law. Central to this protection are requirements and rules of conduct set out in Market in Financial Instruments Directive (MiFID). The main objectives of MiFID are to increase consumer protection, transparency and competition in financial services, to raise the effectiveness of regulatory cooperation and to establish a regulation based on principles of conduct (Skinner, 2007). In order to achieve these goals, MiFID brought ‘maximum harmonization’ to the markets, closing all the loopholes that were left open under the previous legal regime, which concentrated on rule of ‘minimum harmonization and mutual recognition’.