Legal Information

European Union legislation

In the European Union legislation, financial analysis activity is regulated by the following legal instruments:

  • Market Abuse Directive - MAD: Directive 2014/57/EU of the European Parliament and of the Council of 16 April 2014 on criminal sanctions for market abuse (market abuse directive)
  • Financial Instruments Markets Directive (MiFID): Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU Text with EEA relevance.

These two directives establish rules regarding the management of conflicts of interest of financial analysts, imposing, namely, their disclosure.

In this way, these Directives contribute to a greater impartiality and more demanding technical basis for investment recommendations.

The rules of Community law do not, however, impose requirements on the suitability, ethics and professional qualifications of financial analysts and investment advisers. These rules were enshrined by the Portuguese legislator in the Securities Code and by the CMVM in Regulation no. 3/2010.

Portuguese Legislation

In the Portuguese legislation, namely that which transposes the above mentioned European Directives, the activity of the financial analyst and investment adviser is regulated in the following legal and regulatory instruments:

Securities Code

Refer, in particular, to the following standards:

Article 12-A: defines what are Investment Recommendations

Article 12-B: defines the content of the Investment Recommendations

Article 12-C: regards Investment Recommendations and Conflicts of Interest

Article 33: includes investment advice among the activities covered by the mediation of conflicts in charge of the CMVM

Article 290 no. 1, al. f): classifies the investment advisory activity as an investment service

Article 291: classifies the Financial Analysis activity as an Investment Assistance Service

Article 293: Classifies investment advisory firms as financial intermediaries in the form of investment firms

Article 294: clarifies what is meant by investment advice

Article 301: subject to the exercise of investment advisory activity to be registered with the CMVM

Article 309-D: lists the duties of the financial intermediary that prepares Investment Recommendations

Article 314-A: List the information that the investment adviser must obtain from the investor when proposing to provide services

CMVM Regulation n.º 3/2010

This CMVM Regulation is of enormous relevance to the professional activity of the financial analyst and investment adviser, insofar as it sets out the duties of conduct and professional qualification of these professionals and establishes principles of action towards the protection of investors and the efficiency of Marketplace.

In particular, consult the following standards:

Article 10: professional qualification of investment consultants

Article 36: registration and professional qualification of financial analysts