FINANCIAL SERVICES: MOVES TOWARDS INVESTMENT SERVICES DIRECTIVE REVIEW.

Consultation of interested parties comes in the context of the legislative approach on financial services established on the basis of recommendations from the Committee of European Securities Market Regulators ("Lamfalussy Committee").The Investment Services Directive is one of the initiatives aiming to facilitate the creation of an efficient, integrated and disciplined Community financial market. Commission services have already significantly modified their initial proposals to take account of the 77 responses received during the first round of consultation. The main issues that Investment Services Directive review needs to address are therefore:- fine-tuning investor protection obligations to take account of new forms of investment services;- broadening the scope of the Directive to include, among other things, investment advice and trading of commodity derivatives;- simplifying the classification of order-execution systems and making it more flexible. The future Directive would not dictate whether a particular trading system should be defined as an investment firm or as a regulated market;- a greater emphasis on ensuring that different trading systems performing similar functions are subject to comparable regulation;- clarifying requirements for the disclosure of quotes or details of transactions performed off-exchange. It is suggested that these transparency...