| The EU Markets in Financial Instruments Directive (MiFID) has created a range of new requirements for the entire European financial sector. It aims to create a level playing field by increasing competition between investment firms and trading locations within the European Economic Area (EEA) through the creation of a standardized legal framework. This integration of the capital markets also has the objective of increasing investor protection and enhancing the integrity and efficiency of the markets, as MiFID - results in strict pre- and post-trade transparency requirements for share trading
- introduces particular transparency requirements for systematic internalization of share trading and
- imposes a “best execution” obligation, meaning that companies are required to take all reasonable steps to obtain the best possible result for their clients.
MiFID is binding in all EU countries. Numerous regulations contained in the EU Directive have been firmly anchored in German law or common practice for a long time. FWB® Frankfurter Wertpapierbörse (the Frankfurt Stock Exchange), which is operated by Deutsche Börse AG and Scoach Europa AG (a Deutsche Börse Group company), for instance, remains a regulated stock exchange. Off-exchange OTC trading, introduced to some European countries only with the Directive, was already possible in Germany long before MIFID. FRUG (Markets in Financial Instruments Directive implementation law) The MiFID requirements were incorporated into German national law with the FRUG (Markets in Financial Instruments Directive implementation law, Finanzmarkt richtlinie- Umsetzungs gesetz) and became effective on 1 November 2007. FRUG also led to amendments to German banking and stock exchange regulations, e.g. the Wertpapierhandelsgesetz (WpHG, the Securities Trading Act) and the Börsengesetz, (BörsG, the Stock Exchange Act). MiFID and Deutsche Börse Group Deutsche Börse Group has implemented all regulations affecting the Group. In addition, it offers market participants a comprehensive range of services allowing them to explore new business areas and to meet MIFID requirements without encuring large investment costs. Deutsche Börse Group offers a service which helps investment firms’to meet MIFID requirements in post-trade transparency for off-exchange equity transactions. This service also meets the requirements of the British Financial Services Authority (FSA). Deutsche Börse has therefore been awarded the status “ Trade Data Monitor” by the FSA. Changes in Listing Effects of the FRUG on the stock market listing procedure
The taking effect of the FRUG has led to operational changes of security paper permission for trading [.pdf]. The division of the regulated markets into the market segments official market and regulated market has been removed. Since 1 November 2007, admission to the Frankfurt Stock Exchange is solely to the so called regulated market (General Standard), or a section of the regulated market with further follow-up mandatory reports (Prime Standard).
Please also refer to the circular on the cooperation of German stock exchanges (German only) [.pdf].
Changes in Market Data & Analytics MiFID – Post-trade transparency obligation
With the MiFID OTC Post-trade Transparency Service, Deutsche Börse Group provides its clients with a comprehensive service offering to meet post-trade transparency requirements in accordance with MiFID. This enables clients to publish their OTC transactions that are subject to transparency requirements via Deutsche Börse at minimal expense and in compliance with MiFID. The service covers all instruments that are subject to post-trading transparency requirements Europe-wide, and offers optional automatic delay for large transactions, in accordance with MiFID. In addition the Group offers further services in the field of Market Data & Analytics. Changes in Trading & Clearing MiFID – Market participant information and services
Deutsche Börse Group assists market participants in their MiFID initiatives and offers them comprehensive support with detailed information including reports, publications, presentations and contact persons. Best execution
Deutsche Börse offers private and institutional investors best execution in around 245,000 securities – on the Frankfurt trading floor and the fully electronic trading platform Xetra®. With Xetra BEST®, a Xetra feature, orders are fully executed with a price improvement compared to the Xetra order book and without fixed clearing fees at the best price possible, thereby reducing implicit and explicit costs. In addition, the Frankfurt Stock Exchange offers a best execution report as proof of best execution quality, free of charge. Market participants have the possibility to verify the previous month’s actual execution quality for Xetra and floor trading. Besides average spread, execution time, full execution quota etc., the report will include the amount of orders per segment/index as well as average order volumes. Furthermore, shares in the indices DAX®, MDAX®, TecDAX®, SDAX® can be traded without spread on the floor of the Frankfurt Stock Exchange. Realtime quotes are available on boerse-frankfurt.com – Deutsche Börse’s website for investors. New fee model for floor trading
Deutsche Börse Group introduced a new fee model for floor trading in equities and fixed-income securities on the Frankfurt Stock Exchange, as well as for transaction clearing, on 1 November 2007. Under the new pricing model, fees from floor transactions are calculated per executed order and dependent on order value. The calculation of transaction fees thus has become more transparent for investors. | 
