Requirements and Guidance for MiFID Firms 

Supplementary Supervisory Requirements

The Supplementary Supervisory Requirements for MiFID Investment Firms primarily relate to the submission of information by firms to the Central Bank so that the Central Bank can carry out its prudential supervisory function.

View the Supplementary Supervisory Requirements

Books & Records Requirements

The Central Bank has drawn up a list of the minimum records that MiFID Investment Firms are required to keep. (This list does not extend to record keeping requirements arising from other legislation.) The list of minimum records is non-exhaustive and should not be understood as a limitation of the scope of the records that might have to be maintained to ensure compliance with MiFID.

View the Books & Records Requirements

Client Asset Requirements

These requirements set out the rights, duties and responsibilities of a firm in relation to client money and client financial instruments received and held by it arising from its investment business activities. A MiFID Investment Firm must firstly be authorised by the Central Bank to hold assets belonging to its clients. Where a firm is authorised to hold client assets, it must do so in accordance with the Client Asset Requirements and it is required to have its external auditors assess, at least on a six monthly basis, its compliance with these requirements. 

View the Client Asset Requirements

Capital Requirements Directive

MiFID Investment Firms are required to calculate their capital requirements in accordance with the criteria outlined in the Capital Requirements Regulations. Firms are required to hold the minimum level of capital as calculated under the Regulations at all times and are required to submit capital returns to the Central Bank on a periodic basis. 

Firms are also required under the Regulations to initiate the Internal Capital Adequacy Assessment Process. This process requires firms to assess the risks posed by their business, to assess the mitigants in place and to determine an appropriate level of capital for those risks.  It is the responsibility of each firm to design and operate their own process.  The Central Bank through its Supervisory Review and Evaluation Process will undertake an assessment of the firm’s internal process and this review will be proportionate to the nature, scale and complexity of the activities of the firm.

• The Central Bank's Regulatory Document Implementation of the CRD (28 December 2006, amended January 2011)
• Impending changes to the Capital Requirements Directive affecting (MiFID) investment firms (December 2010)
• Investment Firms' Guidelines on ICAAP Submission
• Investment Firms' ICAAP Portal
• CEBS Paper on the ICAAP for Smaller Institutions  

European Supervisory Authorities - Guidelines

Section 1.4 of the Central Bank's Regulatory Document Implementation of the CRD, issued in December 2006, requires MiFID Investment Firms subject to the CRD to ensure that their operations are consistent with the European Banking Authority (EBA) guidelines (previously the Committee of European Banking Supervisors or CEBS), unless otherwise instructed by the Central Bank.

MiFID Investment Firms should also ensure that their operations are consistent with guidelines issued by the European Securities and Markets Authority (ESMA), unless otherwise instructed by the Central Bank.

Please note that the following list of guidelines is not intended to be exhaustive and firms are advised to regularly review the EBA and ESMA websites for new and revised guidelines.

EBA Guidelines

• EBA Guidelines on Internal Governance (GL 44)
• Guidelines on Remuneration Policies and Practices (GL 42) 
• Guidelines on Liquidity Cost Benefit Allocation (GL 36)
• Guidelines on the management of operational risks in market-related activities (GL 35)
• Guidelines on the management of concentration risk under the supervisory review process (GL 31)
• CEBS Guidelines on Stress Testing (GL 32)
• Implementation guidelines on Article 106(2)(c) and (d) of Directive 2006/48/EC recast (GL 38)
• Implementation guidelines regarding instruments referred to in Article 57(a) of Directive 2006/48/EC recast (GL 33)
• Guidelines on the implementation of the revised large exposures regime (GL 26)
• Implementation Guidelines for Hybrid Capital Instruments (GL 27)
• Compendium of Supplementary Guidelines on implementation issues of operational risk (GL 21)
• Technical aspects of the management of interest rate risk arising from non-trading activities under the supervisory review process (GL 11)
• Guidelines on the Application of the Supervisory Review Process under Pillar 2 (CP03 revised) (GL 03) Please note that Section 2.1 of GL03 has been repealed

ESMA Guidelines 

• Guidelines - Systems and controls in an automated trading environment for trading platforms, investment firms and competent authorities
• Guidelines on certain aspects of the MiFID compliance function requirements
• Guidelines on certain aspects of the MiFID suitability requirements
• Guidelines for the prudential assessment of acquisitions and increases in holdings in the financial sector required by Directive 2007/44/EC

Themed Inspections

The following are letters issued by the Central Bank in relation to themed inspections conducted by the Central Bank on MiFID Investment Firms.

• Best Execution under MiFID - Themed Inspection of Investment and Stockbroking Firms
• Corporate Governance Standards - Themed Inspection of Investment Firms

Implementation of MiFID

A joint Central Bank and Industry Working Group was established to prepare for the implementation of MiFID. The Working Group issued the MiFID - Feedback on Discussions of Conduct of Business Industry Working Group in question and answer format, as a guide to the provisions of the MiFID regulations.

Consumer Protection

Other regulatory requirements which investment intermediaries must comply with in the area of consumer protection are set out below:

• Consumer Protection Code 2012
• Consumer Protection Code 2012 Guidance
• Minimum Competency Code 2011