Reform of the Markets in Financial Instruments Directive

On December 8, 2010, the European Commission published a public consultation on the review of the Markets in Financial Instruments Directive (“MiFID”). The Consultation follows technical advice published in July 2010 and October 2010 by the Committee of European Securities Regulators relating to a number of potential MiFID reforms. The Consultation will be open until February 2, 2011. The Commission expects to issue formal legislative proposals in Spring 2011, but the Consultation already indicates the direction these proposals are likely to take. The Consultation proposes numerous reforms that would significantly change the operation of the EU securities and derivatives markets, including a new regime for access by third-country firms to EU markets, increased regulation of derivatives and regulation of currently exempt organized trading venues such as broker crossing systems.