European Commission 25 April 2016, Commission Delegated Regulation (EU) 2017/565 of 25 April 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of that Directive (Text with EEA relevance. ) Also known as
Commission Delegated Regulation (EU) 2017/565, adopted pursuant to Directive 2014/65/EU (MiFID II), supplements that Directive by establishing detailed organisational requirements and operating conditions for investment firms, including rules on compliance, risk management, conflicts of interest, remuneration, outsourcing, personal transactions, and record-keeping. Key provisions define financial instruments and related terms (including systematic internalisers, algorithmic trading, direct electronic access, and spot contracts in currencies and commodities), set out conduct-of-business obligations governing information to clients, suitability and appropriateness assessments, best execution, and client order handling, and impose specific requirements for underwriting, placing, and investment research. The Regulation applies directly in all Member States from the date of application of Directive 2014/65/EU and extends, where relevant, to management companies under Directives 2009/65/EC and 2011/61/EU.AI
European Union ·
Table of Contents CHAPTER I. SCOPE AND DEFINITIONS Article 1. Subject-matter and scope Article 2. Definitions Article 3. Conditions applying to the provision of information Article 4. Provision of investment service in an incidental manner Article 5. Wholesale energy products that must be physically settled Article 6. Energy derivative contracts relating to oil and coal and wholesale energy products Article 7. Other derivative financial instruments Article 8. Derivatives under Section C(10) of Annex I to Directive 2014/65/EU Article 9. Investment advice Article 10. Characteristics of other derivative contracts relating to currencies Article 11. Money-market instruments Article 12. Systematic internalisers for shares, depositary receipts, ETFs, certificates and other similar financial instruments Article 13. Systematic internalisers for bonds Article 14. Systematic internalisers for structured finance products Article 15. Systematic internalisers for derivatives Article 16. Systematic internalisers for emission allowances Article 17. Relevant assessment periods Article 18. Algorithmic trading Article 19. High frequency algorithmic trading technique Article 20. Direct electronic access CHAPTER II. ORGANISATIONAL REQUIREMENTS SECTION 1. Organisation Article 21. General organisational requirements Article 22. Compliance Article 23. Risk management Article 24. Internal audit Article 25. Responsibility of senior management Article 26. Complaints handling Article 27. Remuneration policies and practices Article 28. Scope of personal transactions Article 29. Personal transactions SECTION 2. Outsourcing Article 30. Scope of critical and important operational functions Article 31. Outsourcing critical or important operational functions Article 32. Service providers located in third countries SECTION 3. Conflicts of interest Article 33. Conflicts of interest potentially detrimental to a client Article 34. Conflicts of interest policy Article 35. Record of services or activities giving rise to detrimental conflict of interest Article 36. Investment research and marketing communications Article 37. Additional organisational requirements in relation to investment research or marketing communications Article 38. Additional general requirements in relation to underwriting or placing Article 39. Additional requirements in relation to pricing of offerings in relation to issuance of financial instruments Article 40. Additional requirements in relation to placing Article 41. Additional requirements in relation to advice, distribution and self-placement Article 42. Additional requirements in relation to lending or provision of credit in the context of underwriting or placement Article 43. Record keeping in relation to underwriting or placing CHAPTER III. OPERATING CONDITIONS FOR INVESTMENT FIRMS SECTION 1. Information to clients and potential clients Article 44. Fair, clear and not misleading information requirements Article 45. Information concerning client categorisation Article 46. General requirements for information to clients Article 47. Information about the investment firm and its services for clients and potential clients Article 48. Information about financial instruments Article 49. Information concerning safeguarding of client financial instruments or client funds Article 50. Information on costs and associated charges Article 51. Information provided in accordance with Directive 2009/65/EU and Regulation (EU) No 1286/2014 SECTION 2. Investment advice Article 52. Information about investment advice Article 53. Investment advice on an independent basis SECTION 3. Assessment of suitability and appropriateness Article 54. Assessment of suitability and suitability reports Article 55. Provisions common to the assessment of suitability or appropriateness Article 56. Assessment of appropriateness and related record-keeping obligations Article 57. Provision of services in non-complex instruments Article 58. Retail and Professional Client agreements SECTION 4. Reporting to clients Article 59. Reporting obligations in respect of execution of orders other than for portfolio management Article 60. Reporting obligations in respect of portfolio management Article 61. Reporting obligations in respect of eligible counterparties Article 62. Additional reporting obligations for portfolio management or contingent liability transactions Article 63. Statements of client financial instruments or client funds SECTION 5. Best execution Article 64. Best execution criteria Article 65. Duty of investment firms carrying out portfolio management and reception and transmission of orders to act in the best interests of the client Article 66. Execution policy SECTION 6. Client order handling Article 67. General principles Article 68. Aggregation and allocation of orders Article 69. Aggregation and allocation of transactions for own account Article 70. Prompt fair and expeditious execution of client orders and publication of unexecuted client limit orders for shares traded on a trading venue SECTION 7. Eligible counterparties Article 71. Eligible counterparties SECTION 8. Record-keeping Article 72. Retention of records Article 73. Record keeping of rights and obligations of the investment firm and the client Article 74. Record keeping of client orders and decision to deal Article 75. Record keeping of transactions and order processing Article 76. Recording of telephone conversations or electronic communications SECTION 9. SME growth markets Article 77. Qualification as an SME Article 78. Registration as an SME growth market Article 79. Deregistration as an SME growth market CHAPTER IV. OPERATING OBLIGATIONS FOR TRADING VENUES Article 80. Circumstances constituting significant damage to investors' interests and the orderly functioning of the market Article 81. Circumstances where significant infringements of the rules of a trading venue or disorderly trading conditions or system disruptions in relation to a financial instrument may be assumed Article 82. Circumstances where a conduct indicating behaviour that is prohibited under Regulation (EU) No 596/2014 may be assumed CHAPTER V. POSITION REPORTING IN COMMODITY DERIVATIVES Article 83. Position reporting CHAPTER VI. DATA PROVISION OBLIGATIONS FOR DATA REPORTING SERVICE PROVIDERS Article 84. Obligation to provide market data on a reasonable commercial basis Article 85. Provision of market data on the basis of cost Article 86. Obligation to provide market data on a non-discriminatory basis Article 87. Per user fees Article 88. Unbundling and disaggregating market data Article 89. Transparency obligation CHAPTER VII. COMPETENT AUTHORITIES AND FINAL PROVISIONS Article 90. Determination of the substantial importance of the operations of a trading venue in a host Member State CHAPTER VIII. FINAL PROVISIONS Article 91. Entry into force and application ANNEX I. Record-keeping 31.3.2017
EN
Official Journal of the European Union
L 87/1
COMMISSION DELEGATED REGULATION (EU) 2017/565
of 25 April 2016
supplementing Directive 2014/65/EU of the European Parliament and of the Council as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of that Directive
(Text with EEA relevance)
THE
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