MiFID was formally adopted by the EU legislator on 30 April 2004, but until now, a systematic overview and discussion of the impact of the directive and its different provisions has not existed. The European Directive 2004/39/EC, better known as the Market in Financial Instruments Directive (MiFID), is nothing short of a revolution. This directive represents the cornerstone of the Commission's Financial Services Action Plan and was recently transposed into national law and implemented by investment services providers.

MiFID will fundamentally alter the structure of European securities markets, in a way that possibly not many other pieces of EU financial services legislation have so far done. Much of the available analysis surrounding MiFID has focused on compliance, on building the supporting IT infrastructure and on upgrading procedures within financial institutions. Yet the regulatory impact of MiFID extends far beyond short-term implementation for investment firms. The unprecedented scope of harmonization of securities markets legislation and the resulting open architecture ushered in by MiFID, especially in trade execution and reporting, will cause a profound upheaval within existing market structures.

MiFID is indeed revolutionary; its role and impact can be considered ground-breaking from the competitive, economic and legislative points of view. MiFID came into force in the EU and European Economic Area (EEA) countries on 1 November 2007, but as there were serious delays at the level of the member states and firms in adapting to this, a full appreciation of the changes brought about by this process can still be expected to take some time.