A Differentiated Approach to Client Protection: The Example of MiFID

Ghent University Financial Law Institute Working Paper No. 2010-07

58 Pages Posted: 10 Jun 2010

See all articles by Marc Kruithof

Marc Kruithof

Ghent University Law School; Ghent University, Department of Interdisciplinary Study of Law, Private Law and Business Law

Walter Gerven

KU Leuven

Date Written: June 8, 2010

Abstract

In this contribution to the June 2010 SECOLA conference in Istanbul on "The Failure of Contracting: Financial Crisis, Financial Services and General European Contract Law", we analyze the system of differentiated client protection under the EU Markets in Financial Instruments Directive (“MiFID”), and compare this regime to the approach used by standard private law.

We provide context and background on the genesis of the MiFID client categorization system, and describe its black letter content in detail. We also make an inventory of all MiFID conduct of business rules that differentiate between professional and retail clients. We then analyze to what extent this regulatory system differs from the way in which investor protection is to be differentiated based on general principles of private (contract or tort) law.

Keywords: MiFID, client categorization, differentiated client protection, professional clients, retail clients, investor protection, conduct of business rules, investment services

JEL Classification: K22, K12, K13

Suggested Citation

Kruithof, Marc and Gerven, Walter, A Differentiated Approach to Client Protection: The Example of MiFID (June 8, 2010). Ghent University Financial Law Institute Working Paper No. 2010-07, Available at SSRN: https://ssrn.com/abstract=1622682 or http://dx.doi.org/10.2139/ssrn.1622682

Marc Kruithof (Contact Author)

Ghent University Law School ( email )

Universiteitstraat 4
Gent, B-9000
Belgium

Ghent University, Department of Interdisciplinary Study of Law, Private Law and Business Law ( email )

Universiteitstraat 4
Gent, B-9000
Belgium

Walter Gerven

KU Leuven ( email )

Oude Markt 13
Leuven, Vlaams-Brabant 3000
Belgium

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