Monitor and Manage: MiFID and Power in the Regulation of EU Financial Markets

Yearbook of European Law, Vol. 27, 2008

38 Pages Posted: 21 Sep 2007 Last revised: 19 Jul 2010

See all articles by Larry Catá Backer

Larry Catá Backer

The Pennsylvania State University (University Park) – Penn State Law


MiFID, the Market in Financial Instruments Directive, in force 1st November 2007, is hailed as the next great step toward market integration within the European Union. It is grounded in two key traditional policies of market regulation: surveillance and management. MiFID will exact a greater degree of transparency - paralleling American principles of market regulation. It will also require adherence to a best execution standard for all clients. Most analyses have focused on the costs and implementation of these requirements. Transparency is viewed as either a burden (or opportunity) because of the need to produce, keep and manage more data. Markets in information will surely grow. The "best execution" standards provide a greater means of standardizing industry practices - with the potential benefit to regulators to which power over market behavior should flow. This article will focus on the potential ramifications of the surveillance and regulatory aspects of MiFID in terms of nature of the character of the regulatory power in the financial products sector. Specifically the article examines the effects of the creation of the markets for information elaborated or augmented through MiFID in terms of the regulation of the behavior of participants in financial markets and the entities they serve. Particular attention will be paid to the effects of MiFID on public and private anti-corruption campaigns, the use of these regulations to influence the behavior of issuers and market middlemen, and the potential utility of these regulations to elements of civil society and the media in their campaigns for corporate and capital social responsibility.

Keywords: securities regulation, MiFID, surveillance, financial services providers

JEL Classification: K22,M14

Suggested Citation

Backer, Larry Catá, Monitor and Manage: MiFID and Power in the Regulation of EU Financial Markets. Yearbook of European Law, Vol. 27, 2008, Available at SSRN:

Larry Catá Backer (Contact Author)

The Pennsylvania State University (University Park) – Penn State Law ( email )

Lewis Katz Building
University Park, PA 16802
United States

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