The Markets in Financial Instruments Directive comes into effect on 1st of November, 2007.  MiFID will replace the existing Investment Services Directive (ISD).  MiFID is an EU wide effort to update the regulations around the investment banks.  The directive will allow companies to provide services across borders and establish branches in other European states.  Companies affected by MiFID include investment banks, market data companies, trading platforms and exchanges. 

Extended Scope
Extended Scope for MiFID is given in the following points:

1. MiFID extends the coverage of the current ISD and introduces new and more extensive requirements that firms will have to adapt to, in particular for their conduct of business and internal organization. 
2. MiFID extends the scope of share trading through exchanges to include shifting shares between their customers without having to go through exchanges, which is easier. 
3. Her Majesty’s Trust (HMT) is also considering amending the relief of stamp duty for shares traded over-the-counter (OTC) and which are admitted to trading on multilateral trading facilities (MTF), such as AIM and Plus Markets.
4. MiFID upgrades the advice on core investment service that can be passported on stand-alone basis.
5. Lastly, MiFID extends the scope of passport to cover derivatives and contracts.
   

Note: Passporting means a UK firm’s rights to carry on business in another EEA state if it has an entitlement under a relevant single market directive

Consequences
The consequences for not complying with MiFID could be grave.  Companies could face fines and extensive scrutiny by the regulatory authority if they are not compliant with MiFID by the 1st of November 2007.  Late reaction by senior management can lead to hasty decisions and financial loss as companies turn to their IT vendors for last minute solutions.  Above all, companies could lose out on opportunities for new business.

How Tabaq Software can help you?
jComply makes it possible for companies to create policies based on external regulations such as MiFID and disseminate them to their employees.  The training module in the system can help the compliance managers in creating multiple choice tests which can be published to the end users for evaluation.  The system automatically maintains an audit trail which can show an auditor or a compliance manager an entire chain of events.  All in all, jComply goes full circle and can help a company achieve its desired compliance ratio for a regulation.

To read more about jComply visit, jComply page.

Reference
For more information on MiFID, visit
Markets in Financial Instruments Directive (MiFID)
http://www.fsa.gov.uk/pages/About/What/International/mifid/index.shtml