1. Investment firms acting on behalf of retail clients, as defined in Article 4(1), point (11), of Directive 2014/65/EU, or professional clients as referred to in Section II of Annex II to that Directive shall not receive any fee, commission or non-monetary benefit from any third party for executing orders from those clients on a particular execution venue or for forwarding orders of those clients to any third party for their execution on a particular execution venue (‘payment for order flow’).

The first subparagraph shall not apply to rebates or discounts on the transaction fees of execution venues, where permitted under the approved and public tariff structure of a trading venue  in the Union or of a third-country trading venue, where they exclusively benefit the client. Such discounts or rebates shall not result in a monetary benefit to the investment firm.

2. A Member State in which, before 28 March 2024,  investment firms acting on behalf of clients are established which receive a fee, a commission or a non-monetary benefit from any third party for executing orders from those clients on a particular execution venue or for forwarding orders of those clients to any third party for their execution on a particular execution venue, may exempt investment firms under its jurisdiction from the prohibition  laid  down  in paragraph 1 until 30 June 2026 where those investment firms provide investment services to clients domiciled or established in that Member State.

To apply the exemption referred to in the first subparagraph, a Member State which fulfils the condition laid down in the first subparagraph shall notify ESMA by 29 September 2024 to that effect. ESMA shall maintain a list of Member States using that exemption. The list shall be made available to the public and updated regularly.