Ireland as a Location for MiFID Investment Firms 2024

Ireland is home to a significant number of investment firms regulated under the legislative framework set out in the revised Markets in Financial Instruments Directive 2014/65 (“MiFID II”) and the Markets in Financial Instruments Regulation 600/2014 (“MiFIR”).

As of early May 2024, Ireland has 89 authorised MiFID investment firms. There are a number of advantages to being authorised in Ireland under this framework, including:

  • a strong regulatory framework with a credible and experienced regulator, the Central Bank of Ireland (the “CBI”);
  • a favourable passporting regime with the ability to passport to other European Economic Area (“EEA”) member states either on a branch or a cross-border services basis;
  • a favourable tax regime, due to a combination of a 12.5% corporate tax rate and an exceptionally extensive and comprehensive set of double tax agreements; and
  • access to a sophisticated financial services ecosystem with a deep pool of talent including managers, professional advisers and service providers including not only native English speakers but a sizeable international population.

Regulatory Framework

Generally, a firm must be authorised by the CBI under the European Union (Markets in Financial Instruments) Regulations 2017 (the “MiFID Regulations”) if it wishes to provide investment services and/or activities in Ireland.

As MiFID is a maximum harmonisation regime, the prudential rules with which an investment firm that is authorised by the CBI must comply are similar to those in other EU jurisdictions i.e. there is no significant “gold plating”. The key legislative requirements with which an Irish MiFID firm must comply are the MiFID Regulations (which transpose MiFID II into Irish law), MiFIR and directly applicable Commission Delegated Regulations. There is also an array of applicable secondary legislation and guidance/Q&A issued by the European Securities and Markets Authority (“ESMA”) and/or the CBI.

From a capital perspective, most MiFID firms are subject to the prudential framework set out under the Investment Firms Regulation 2019/2033/EU (the “IFR”) and the Investment Firms Directive 2019/2034/EU (the “IFD”).


An investment firm that is authorised by the CBI under the MiFID Regulations can passport its authorisation into other EEA jurisdictions, either on a cross-border freedom of services basis or by establishing a branch, without the need to seek further authorisation under MiFID.  

Third Country Firms and Per Se Professionals

An investment firm authorised in a non-EEA member state (a “Third Country Firm”) may be able to provide investment services to per se professional clients (as defined under MiFID) in Ireland if it falls within the so-called “safe harbour” exemption under the MiFID Regulations.

The Safe Harbour Exemption

Regulation 5(4) and (5) of the MiFID Regulations permit a Third Country Firm to provide MiFID services/activities to a per se professional client and/or to an eligible counterparty without establishing a branch in Ireland, once it satisfies certain requirements, namely:

  • the Third Country Firm’s head or registered office must be in a non-EEA member state and it must not have a branch in Ireland. In this context, the Third Country Firm should take care not to establish any permanent presence in Ireland that could be deemed a de facto branch;
  • the Third Country Firm must be subject to authorisation and supervision in the third country in which it is established and the relevant competent authority must pay due regard to any recommendations of the Financial Action Task Force (“FATF”) in the context of anti-money laundering and countering the financing of terrorism; and
  • co-operation arrangements must be in place between the CBI and the competent authorities of the third country that include provisions regulating the exchange of information for the purpose of preserving the integrity of the market and protecting investors.

The Equivalence Framework

Article 46 of MiFIR allows for the provision of investment services in the EEA by a Third Country Investment Firm, subject to the fulfilment of certain conditions (the “Equivalence Framework”). 

Under MiFIR, a Third Country Firm can provide investment services to or perform investment activities for per se professional clients and/or eligible counterparties without establishing a branch where it is registered in the Register of Third Country Firms kept by ESMA (the “Register”).

However, before a Third Country Firm can be entered into the Register, several conditions must be fulfilled. In particular, the European Commission must have adopted a decision pursuant to Article 47 of MiFIR as to the equivalence of the supervisory and regulatory regime of the third country where the firm is established. To date, no such equivalence decision has been adopted.

Moreover, the Equivalence Framework, as set out in the IFR and IFD, has been applicable to firms since 26 June 2021. Specifically, the IFR amends MiFIR to require a Third Country Firm to establish necessary arrangements and procedures to report detailed information to ESMA on an annual basis as a condition of registration. 

The IFR also makes changes to the process for assessing equivalence. In particular, where the scale and scope of the services provided and the activities performed by Third Country Firms in the EU are likely to be of systemic importance, the IFR amends MiFIR to:

  • provide for a more granular equivalence assessment as to whether firms authorised in the relevant third country comply with equivalent legally binding prudential, organisational and business conduct requirements; and
  • give the European Commission powers to attach operational conditions to equivalence decisions.

Third Country Firms and Retail/Opted-Up Professional Clients

Under the MiFID Regulations, a Third Country Firm will generally need to establish a branch in Ireland and obtain prior authorisation from the CBI before providing investment services/activities to retail clients and opted-up professional clients.

However, it is possible that a Third Country Firm will be able to provide such services/activities without establishing a branch on a “reverse solicitation basis” i.e. when the client initiates, at its own exclusive initiative, the provision of the relevant service or performance of the relevant activity. This is provided for in Regulation 51 of the MiFID Regulations. Where a client does solicit services on a reverse solicitation basis, this does not entitle the Third Country Firm to market new categories of investment products or investment services to that client. Careful consideration should be given before relying on this provision, in particular, applicants should review the ESMA’s Q and A document on this topic.1

The Authorisation Process

An entity wishing to become authorised by the CBI as a MiFID firm must apply to the CBI for authorisation. The MiFID application process generally involves the steps set out in the table below.

Stages of the Authorisation Process

Step 1: Pre-engagement and scoping

Each applicant for authorisation must consider whether its proposed business model:

  • requires authorisation pursuant to the MiFID Regulations;
  • can comply with the MiFID Regulations;
  • can comply with the CBI’s requirements and any other financial services law; and
  • is capable of complying with, and adhering to, the requirements that must be satisfied on an ongoing basis.

The applicant seeking authorisation engages with professional advisors to scope out the business proposed in Ireland. It is important for applicants to:

  • understand resourcing expectations (discussed below); and  
  • identify what investment and ancillary services it requires authorisation for (including any potential additional permissions under the domestic Investment Intermediaries Act 1995).

The applicant, typically through its legal advisors, requests a preliminary meeting with the CBI to discuss the proposed application.

Step 2: Preliminary Meeting

A preliminary meeting will be arranged with the Central Bank to discuss the application, timeline and any gating issues.

The applicant must submit a slide deck to the CBI, 15 working days or more before the preliminary meeting, including a summary of:

  • its ownership structure;
  • its business model;
  • the regulatory permissions sought;
  • its key products/services;
  • its client base;
  • its governance, risk management and resourcing arrangements, including staffing arrangements;
  • proposed resourcing/staffing of the firm;
  • details of any proposed critical or important outsourcing;
  • a summary overview of the proposed internal control functions and frameworks to include at least the risk, compliance and internal audit functions, and where applicable, client assets;
  • where applicable, background/context on the shareholders and the wider group;
  • the rationale for locating in Ireland;
  • the firm’s readiness (“As-Is State” vs “To-Be State”) with high-level timeline and plan of action to the firm’s desired authorisation date; and
  • financial resilience information. This includes prudential capital requirement projections and indicative three year projected financials (incorporating income statement, balance sheet and capital projections).must prepare a high-level presentation for a preliminary application to the CBI.

The CBI recently published its Authorisation Guidance Note for MiFID Investment Firms - Preliminary Meeting Pre-Application Presentation, (available here). This Guidance recommends that the slide deck should include no more than 30 slides and provides Appendices to aid firms in mapping their activities.

Step 3: Key Facts Document (“KFD”)

After the preliminary meeting, the CBI will provide feedback and invite the applicant to provide a “Key Facts Document” (“KFD”) for its review. The KFD builds on the information provided in the slide deck described above (i.e. the proposed business and operational model and associated risks) and irons out any initial gating issues before the formal application. In particular, the KFD should include the following information:

  • introduction and the purpose, scope and rationale for authorisation application;
  • brief background of the applicant firm and the reason(s) why the applicant firm has selected Ireland as a location from which to carry out investment services and apply for MiFID II authorisation;
  • business model;
  • client assets;
  • clients;
  • governance & staff resourcing arrangements;
  • high-level capital projections for the First 3 Years (i.e. Year 0, Year 1, Year 2, Year 3);
  • requests for permission, derogation or use of a waiver under relevant legislation; and
  • application submission timeline

 The KFD should be provided in word or PDF format and be more detailed than the slide deck.

The CBI will review the KFD and will revert with comments. In our experience, there are typically a minimum of two rounds of questions on the KFD.

The CBI recently published its Authorisation Guidance Note for MiFID Investment Firms - Key Facts Document (available here) which notes that:

“The length of time the KFD assessment process takes will vary depending on the complexity of the business proposal and the quality of the firm’s KFD submission, with high quality KFD submissions generally progressing faster as less clarifications are necessary from the Central Bank’s perspective”.

These Guidelines also include a template for completing the KFD, tables of the type of information to be provided about board members, Pre-Approval Controlled Functions (“PCFs”) and staffing arrangements, and sample charts for illustrating the qualifying shareholdings and organisational structure.

Step 4: Formal Application

Once the KFD is clear of comment, the Central Bank will decide whether to invite the applicant to submit its formal application.

The formal application requires the following documentation and information:

  • completed MiFID Application Form. The application form is available here;
  • a Programme of Operations setting out in detail the Firm’s business model, governance framework, risk and compliance framework, high level capital requirements, wind down plans, resourcing and outsourcing and organisational structure chart;
  • shareholding information on each of the qualifying holders of the applicant firm (including group structure);
  • financial and capital projections for years 0-3; and
  • completed individual questionnaires (“IQs”) for all holders of “pre-approval controlled functions” (e.g. directors and senior managers);
  • a client asset management plan (if the applicant intends to hold client assets);  and
  • orderly and forced winding down plan of the firm including the ICAAP for Class 1 minus and Class 2 applicant firms.

The Central Bank may request other documents such as certain policies in its discretion.

The CBI recently published its Authorisation Guidance Note on Completing an Application Form for Authorisation as a MiFID Investment Firm (available here) which notes that incomplete applications will be returned to the applicant.

In our experience, there are typically a minimum of three rounds of questions from the CBI before it issues its decision.

Step 5: Review of Application and Determination Process

The CBI will make its determination within 6 months of receiving a completed application.

However, if the CBI requests further information or records in relation to the application, a determination will be made within 6 months after the receipt by the CBI of the further information or records.

Due to the CBI’s thorough review and comment process, an applicant will have the necessary resources, board of directors, risk management framework, outsourcing framework and operations structure in place to carry out regulated activities once it has been granted authorisation.

Key Considerations

For existing groups with substantial operations outside Ireland, an important requirement will be the CBI’s emphasis on ensuring that the applicant’s “heart and mind” will be located in Ireland. This essentially means that the CBI will need to be satisfied that the applicant will be properly run in Ireland and that the CBI will be able to supervise it effectively. Among other things, the CBI will expect to see present in Ireland:

  • a senior management team with strength and depth overseen and directed by a strong board. At a minimum the applicant will require three full time dedicated staff; and
  • organisation structure and reporting lines which ensure there is appropriate separation and oversight of all activities.


An Irish authorised investment firm may outsource/delegate some of its activities to entities in other jurisdictions, subject to compliance in particular with :

  • the MiFID Regulations;
  • Commission Delegated Regulation 565/2017 (“CDR 565”); and
  • the CBI’s Cross-Industry Guidance on Outsourcing.

However, the investment firm will need to be able to satisfy the CBI that there are objective reasons for the outsourcing arrangements i.e. the Irish entity cannot be a letter-box entity or allow the circumvention of (i) the MiFID framework, and (ii) the responsibilities of the investment firm.

Fitness and Probity

The CBI must approve directors and senior executives as part of the authorisation process i.e. the CBI will need to be satisfied that the person appointed to the relevant role is a fit and proper person, with appropriate competence and experience in financial services to enable them to fulfil their duties. In general, to be fit and proper, a person must:

  • be competent and capable;
  • act honestly, ethically and with integrity; and
  • be financially sound.

In addition, the Central Bank (Individual Accountability Framework) Act 2023 creates additional responsibilities and obligations for senior executives which means they are individually accountable for certain decisions and must comply with common conduct standards and additional conduct standards as applicable.2


The CBI’s Regulatory and Supervisory Outlook Report3 suggests that MiFID Investment Firms face the following issues:

  • a lack of fit for purpose governance structures;
  • inadequate disclosure of conflicts of interest to customers;
  • market abuse due to inappropriate use of information;
  • strategic risks due to macro-economic conditions and digitalisation;
  • risks to solvency and liquidity; and
  • overreliance on third party outsource providers.

Accordingly firms applying to be authorised under MiFID should show the CBI that they have appropriate policies, procedures and staff to avoid these issues.

How Can We Help?

McCann FitzGerald LLP is Ireland’s premier law firm and advises on the full range of financial activities undertaken in Ireland. We have substantial experience in successfully guiding applicants through the MiFID application process (including advising on capital and consolidation matters) and in helping them to comply with their legal obligations, once established. If you are considering setting up a MiFID firm in Ireland, please contact us for further information as to how we can help.


  1. See here.
  2. For more information on the Individual Accountability Framework, see here.
  3. See here.

This document has been prepared by McCann FitzGerald LLP for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.