Execution of orders on behalf of clients
Concluding an agreement to buy or sell a financial instrument on a client's behalf needs an investment firm licence or a banking licence under MiFID II Annex I, Section A(2). The brokerage must set out a best execution policy and report transactions to its supervisory authority, then it can passport across the EEA.
Definition
Concluding agreements to buy or sell financial instruments on behalf of clients.
- MiFID II, Annex I, Section A(2): 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 · Abu Dhabi Global Market (ADGM)
Investment firm licence
Financial Services Permission for Dealing in Investments as Agent or Matched Principal (Category 3A)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 · Dubai International Financial Centre (DIFC)
Investment firm licence
Financial Services Permission for Dealing in Investments as Agent or Operating an Alternative Trading System (Category 3A)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
What factors determine best execution under MiFID II?
Brokers weigh price, execution cost, speed, the likelihood of execution and settlement, order size and market impact. For a retail client, the main benchmark is total consideration: the instrument's price plus every cost of executing the order.
What post-trade transaction reporting is required for executed orders?
The executing firm reports full transaction details, trader identification, client identifiers and exact trade parameters included, to its national competent authority or an approved reporting mechanism. The deadline is the close of the following working day.
Sources
- MiFID II Annex I, Section A(2) · retrieved 2026-09-24
Planning execution of orders on behalf of clients? Get the licence right first
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