Part II Investment Firms and Investment Services, 8 Inducements

Subject(s):

Conduct of business regulation — Enforcement — Investment business — Regulated activities — Supervision

This chapter discusses the MiFID II inducement rules. During the negotiations on MiFID II, it became clear that inducements were a topic on which there was no easy agreement between the Member States. While certain Member States pressed for a total ban on inducements, others were unwilling to impose such strict rules. The political compromise allowed for deviating rules by those Member States requesting stricter rules. This may seem counter to the European legislator’s general approach to limit Member State options by creating ‘single rulebooks’ and greater regulation. The authors express disappointment that, on such an important topic, the European market will continue to have deviating rules per Member State. The Dutch legislator has already indicated that it will make use of this; according to the authors, other Member States where stricter rules apply may do likewise, leaving an un-level playing field for investment firms regarding the use of inducements.