Reshaping Order Execution and the Role of Interest Groups under MiFID II

Posted: 21 Jan 2012 Last revised: 25 May 2012

See all articles by Guido Ferrarini

Guido Ferrarini

University of Genoa - Law Department and Centre for Law and Finance; European Corporate Governance Institute (ECGI)

Niamh Moloney

London School of Economics - Law Department; European Corporate Governance Institute (ECGI)

Date Written: May 2012

Abstract

The controversial and long-awaited Commission Proposals to revise the cornerstone Markets in Financial Instruments Directive 2004 (MiFID I) were presented in October 2011. This article places this important reform (MiFID II) in context by examining the impact of MiFID I since its application to EU financial markets in November 2007 and by considering what MiFID I’s impact suggests for the design of the MiFID II regime. It considers how MiFID I reshaped the EU share trading marketplace and how the dominant interests which shaped MiFID I’s regulatory design fared. It also examines how those interest groups are seeking to shape MiFID II and the implications. It suggests that the influence of interest groups may have led to an overly ambitious Proposal which is excessively concerned with investment firm and trading platform interests, and not sufficiently concerned with the overall efficiency and effectiveness of EU share trading markets. It calls for a more modest approach to reform, based on fine-tuning MiFID I.

Keywords: MiFID; order execution; exchanges; transparency; trading systems

JEL Classification: G1, G2, G10, G15, G18, K2, K22, N20

Suggested Citation

Ferrarini, Guido and Moloney, Niamh, Reshaping Order Execution and the Role of Interest Groups under MiFID II (May 2012). European Business Organization Law Review, Forthcoming 2012. Available at SSRN: https://ssrn.com/abstract=1989041 or http://dx.doi.org/10.2139/ssrn.1989041

Guido Ferrarini (Contact Author)

University of Genoa - Law Department and Centre for Law and Finance ( email )

Via Balbi, 22
16126 Genova, 16100
Italy
+39 010 209 9894 (Phone)
+39 010 209 9890 (Fax)

HOME PAGE: http://www.clfge.org

European Corporate Governance Institute (ECGI)

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

HOME PAGE: http://www.ecgi.org

Niamh Moloney

London School of Economics - Law Department ( email )

Houghton Street
London WC2A 2AE, WC2A 2AE
United Kingdom

European Corporate Governance Institute (ECGI)

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

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