Dealing on own account
Trading against the firm's own capital to conclude a market transaction needs an investment firm licence or a banking licence under MiFID II Annex I, Section A(3). Market makers and systematic internalisers authorised this way face strict capital adequacy rules, conduct supervision and pre-trade transparency duties, and can passport across the EEA.
Definition
Trading financial instruments against proprietary capital, which includes acting as counterparty to client trades.
- MiFID II, Annex I, Section A(3): official text
Which licence you need
Licence families that typically permit this activity:
- IF · Abu Dhabi Global Market (ADGM)
Investment firm licence
Financial Services Permission for Dealing in Investments as Principal (Category 2)FSRA
- IF · Australia
Australian financial services licence (AFSL)
ASIC
- IF · Bermuda
Investment Business Licence
Investment Business Licence (standard licence, under the Investment Business Act 2003)BMA
- IF · Cayman Islands
Securities Investment Business Licence / Registered Person
CIMA
- IF · Cyprus
Cyprus Investment Firm (CIF) authorisation
CySEC
- IF · Czech Republic
Investment Firm licence
CNB
- IF · Dubai International Financial Centre (DIFC)
Investment firm licence
Financial Services Permission for Dealing in Investments as Principal (Category 2)DFSA
- IF · Estonia
Authorisation as an investment firm
FI
- IF · Germany
Investment firm licence
BaFin
- IF · Hong Kong
Type 1 Licence for Dealing in Securities
SFC
- IF · Hong Kong
Type 2 Licence for Dealing in Futures Contracts
SFC
- IF · Ireland
Investment Firm Authorisation (MiFID II)
CBI
- IF · Italy
Investment firm licence (SIM)
CONSOB
- IF · Latvia
Investment firm licence
LB
- IF · Lithuania
Financial brokerage firm licence
LB
- IF · Luxembourg
Investment firm authorisation
CSSF
- IF · Malaysia (Labuan)
Securities Licensee licence
Securities Licensee licence (dealing in / advising on securities)Labuan FSA
- IF · Malta
Investment services licence (Category 1, 2, or 3)
MFSA
- IF · Mauritius
Investment Dealer Licence
FSC
- IF · Netherlands
Investment firm licence
Investment firm licence (Vergunning beleggingsonderneming) under Wft Article 2:96 and MiFID IIAFM
- IF · Poland
Brokerage House licence (dom maklerski)
KNF
- IF · Seychelles
Securities Dealer's Licence
FSA
- IF · Singapore
Capital Markets Services (CMS) Licence
MAS
- IF · Slovakia
Investment firm licence
NBS
- IF · South Africa
Over-the-Counter Derivative Provider (ODP) authorisation
Over-the-Counter Derivative Provider (ODP) authorisation under the Financial Markets ActFSCA
- IF · Spain
AV) investment firm licence
CNMV
- IF · Switzerland
Securities firm licence
FINMA
- IF · United Kingdom
MIFIDPRU Investment Firm Authorisation (Part 4A FSMA)
FCA
Where it can be licensed
Frequently asked questions
Does proprietary trading always require a MiFID II investment firm licence?
Not always. A firm trading purely for its own account, with no external clients, may qualify for the dealing-on-own-account exemption under MiFID II Article 2. Market makers, members of a regulated market and algorithmic high-frequency traders are usually excluded from that exemption.
What transparency requirements apply to systematic internalisers?
A systematic internaliser must publish firm bid and offer quotes during market hours, for liquid instruments up to standard market size. Commercial access to those quotes has to stay non-discriminatory, open equally to qualified institutional and retail counterparties.
Sources
- MiFID II Annex I, Section A(3) · retrieved 2026-09-24
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