Professional or institutional investor regulations

On this website, ‘professional’ or ‘institutional’ investors are those who qualify as a ‘Professional Client’ as defined under the ‘Markets in Financial Instruments Directive’ and implemented into the Financial Conduct Authority Conduct of Business Rules, COBS 3.5 in the United Kingdom.

In summary a person who can be classified as a professional client under the Markets in Financial Instruments Directive will generally need to meet one or more of the following requirements:

(1) An entity required to be authorised or regulated to operate in the financial markets. The following list includes all authorised entities carrying out the characteristic activities of the entities mentioned, whether authorised by an EEA State or a third country and whether or not authorised by reference to a directive:

(a) a credit institution;
(b) an investment firm;
(c) any other authorised or regulated financial institution;
(d) an insurance company;
(e) a collective investment scheme or the management company of such a scheme;
(f) a pension fund or the management company of a pension fund;
(g) a commodity or commodity derivatives dealer;
(h) a local
(i) any other institutional investor;

(2) a large undertaking that meets two of the following tests: (i) a balance sheet total of EUR 20,000,000; (ii) an annual net turnover of EUR 40,000,000; (iii) own funds of EUR 2,000,000

(3) a national or regional government, a public body that manages public debt, a central bank, an international or supranational institution (such as the World Bank, the IMF, the ECB, the EIB) or another similar international organisation.

(4) another institutional investor whose main activity is to invest in financial instruments

Please note that the above summary is provided for information purposes only. If you are uncertain as to whether you can both be classified as a professional client under the Markets in Financial Instruments Directive, you should seek independent advice.