Consultation on CESR's draft advice on the second set of mandates from the European Commission on the Markets in Financial Instruments Directive (MiFID)

CESR publishes today its consultation paper (CESR ref: 04-562) with its proposed advice responding to the second set of mandates from the European Commission on the legislative measures to implement the Markets in Financial Instruments Directive. CESR's advice on this second set of mandates must be submitted to the European Commission by the end of April 2005.
When completed, CESR's advice on both this set of mandates and the first set of mandates received in January 2004 (which must be submitted by the end of January 2005), will assist the European Commission in developing a legal text which will take the form of either a Regulation or a Directive.
This legislation will set out what is known under the Lamfalussy legislative process as Level 2 technical implementing measures.
The draft technical advice on the second set of mandates under the MiFID covers aspects falling under two areas. The first aspect of this advice is related to Intermediaries and includes; the definition of investment advice and the list of financial instruments (article 4); the general obligations to act fairly, honestly and professionally (article 19.1); the suitability test (on article 19.4); the appropriateness test (article 19.5 article 19.6); the execution only business and the transactions executed with eligible counterparties (article 24). The second aspect of this advice relates to Markets; in particular, limit order displays (article 22) and pre-trade transparency of internalizers (article 27).
Comments on the guidelines are welcomed by 21 January 2005 and can be submitted online via CESR's website under the heading