Financial Market Directive Implementation Act

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Basic data
Title: Act implementing the Markets in Financial Instruments Directive and the Commission's Implementing Directive
Short title: Financial Market Directive Implementation Act
Abbreviation: FRUG (not official)
Type: Federal law
Scope: Federal Republic of Germany
Legal matter: Capital market law
Issued on: July 16, 2007 ( BGBl. I p. 1330 )
Entry into force on: Mostly November 1st, 2007
Last change by: Art. 19a No. 4 G of December 21, 2007
( Federal Law Gazette I p. 3089, 3139 )
Effective date of the
last change: 		December 28, 2007
(Art. 20 G of December 21, 2007)
Please note the note on the applicable legal version.

The Financial Market Directive Implementation Act (FRUG abbreviation) is a German article law that transposes Directive 2004/39 / EC on markets in financial instruments into national law.

The law results in extensive changes for securities trading and thus above all in the securities trading law . As Article 2, it also contains a new Stock Exchange Act , which replaced the old Stock Exchange Act on November 1, 2007. At the same time, most of the changes made by the FRUG come into effect. Only the authorizations to issue ordinances came into force on the day after their promulgation.

On the basis of the authorizations included in the Securities Trading Act by the FRUG, the ordinance specifying the rules of conduct and organizational requirements for investment services companies was issued on July 20, 2007 (Wertpapierdienstleistungs-Behavior- und Organizationverordnung, WpDVerOV for short). The duties of financial instruments offering investment services company ( financial institutions , banks and other providers of financial services) to their customers is there are essentially guidelines on the following topics (played strongly here in brief):

  • Classification of the client (classification according to the degree of experience and knowledge in dealing with financial instruments)
  • Design of customer information
  • Information to be obtained from the customer
  • Reporting obligations to customers
  • Processing of customer orders (is treated very differently)
  • Organizational and record-keeping obligations of investment services companies.

Also on July 20, 2007, the Federal Ministry of Finance issued the First Ordinance amending the Financial Analysis Ordinance , which essentially regulates the organizational obligations of investment services companies. Both of these ordinances came into force on November 1, 2007, like the FRUG.

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