MiFID is a âMarkets in Financial Instrumentsâ Directive of the European Parliament and Council of Europe. The aim of this directive is to ensure unified rules of financial instruments trade in the entire EU. These rules are based on the principles of greater security of investors, better transparency, and integral approach to regulation in all the EU-member countries; thus the rules contribute to better integral market of financial services. This directive affects financial institutionsâ trade of financial instruments including consultations to the subject of financial issues and products extension; it also influences the activity of securities brokers and property management; and the directive is evaluated as a sort of reform in securities stock-exchange.
In Lithuania, the main novelties, which are determined by this EU directive, are as follows:
- Elimination of stock-exchange monopoly. The possibility to create buy/sell deals on financial instruments included into the trade on the regulated market off stock-exchange.
- A well distinguished principle of honest behaviour with customers.
- Differentiation of the banksâ customers and the customers of finance brokersâ enterprises into non-professionals, professionals, and proper deal parties. Different customersâ groups will be applied different security means.
- Intensification of the procedures of investment researches prepared by finance analysts.
In order to integrate MiFID requirements into the FORPOST banking information system, which is used in the majority of Lithuanian banks, now there has been implemented one of the MiFID directive requirements, i.e. formation of the securities deals data file, designed for TRS (Transaction Reporting System). Further stages of the project are being analysed at the moment. Next steps of MiFID development in the FORPOST banking information system will be taken in the nearest future.