Reception and transmission of orders
Receiving orders to buy or sell securities and passing them to third-party brokers for execution requires an investment firm licence or a banking licence under MiFID II Annex I, Section A(1). Authorised introducing brokers benefit from European passporting rights, allowing them to market services and aggregate client orders across all EEA member states.
Definition
Receiving client orders in financial instruments and passing them to another firm for execution.
- MiFID II, Annex I, Section A(1): official text
Which licence you need
Licence families that typically permit this activity:
- IF · Abu Dhabi Global Market (ADGM)
Financial Services Permission for Dealing in Investments as Agent or Matched Principal (Category 3A)
FSRA
- IF · Abu Dhabi Global Market (ADGM)
Financial Services Permission for Advising on Investments or Arranging Deals in Investments (Category 4)
FSRA
- IF · Australia
Australian financial services licence (AFSL)
ASIC
- IF · Bermuda
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 (povolení k činnosti obchodníka s cennými papíry - OCP)
CNB
- IF · Dubai International Financial Centre (DIFC)
Financial Services Permission for Dealing in Investments as Agent or Operating an Alternative Trading System (Category 3A)
DFSA
- IF · Dubai International Financial Centre (DIFC)
Financial Services Permission for Advising on Financial Products or Arranging Deals in Investments (Category 4)
DFSA
- IF · Estonia
Authorisation as an investment firm
FI
- IF · Germany
Investment firm licence (Erlaubnis zur Erbringung von Wertpapierdienstleistungen nach § 15 WpIG)
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 Business Firm Authorisation (Section 10 IIA 1995)
CBI
- IF · Ireland
Investment Firm Authorisation (MiFID II)
CBI
- IF · Italy
Società di Intermediazione Mobiliare (SIM) investment firm licence
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 (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 (Vergunning beleggingsonderneming) under Wft Article 2:96 and MiFID II
AFM
- IF · Poland
Brokerage House licence (dom maklerski)
KNF
- IF · Seychelles
Securities Dealer's Licence (full or restricted)
FSA
- IF · Singapore
Capital Markets Services (CMS) Licence
MAS
- IF · Slovakia
Investment firm licence (povolenie na poskytovanie investičných služieb pre obchodníka s cennými papiermi)
NBS
- IF · South Africa
Financial Services Provider licence - Category I (advice and/or intermediary services, non-discretionary, incl. crypto assets)
FSCA
- IF · Spain
Sociedad de Valores y Agencia de Valores (SV / AV) investment firm licence
CNMV
- IF · Switzerland
Securities firm licence (Wertpapierhaus-Bewilligung nach Art. 41 FINIG)
FINMA
- IF · United Kingdom
MIFIDPRU Investment Firm Authorisation (Part 4A FSMA)
FCA
Where it can be licensed
Frequently asked questions
Can an order reception and transmission broker hold client money?
An investment firm authorised solely for order reception and transmission may hold client money only if it holds the relevant ancillary permission under MiFID II Section B(1). Without that permission, all client funds and securities must flow directly to the executing broker.
What disclosure rules apply when receiving payment for order flow?
MiFID II strictly restricts payment for order flow. Firms transmitting client orders must demonstrate that any routing arrangements or venue fees enhance execution quality for the client and do not create conflicts of interest or undermine best execution obligations.
Sources
- MiFID II Annex I, Section A(1) · retrieved 2026-09-24
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