MiFID II, AIFMD and CBD: Why Europe’s fund competitiveness starts with compliance
Europe’s financial industry is changing fast.
While capital moves freely across borders, rules do not always follow suit.
For fund managers and investment firms, the tension between opportunity and fragmentation defines their daily reality.
At dorhyan.eu, we believe that Europe’s competitiveness begins with its structure. In finance, structure means compliance. This is not a bureaucratic burden, but rather a framework that enables firms to grow, attract capital and earn the trust of investors across the European Union.
The key directives that shape this framework are MiFID II, AIFMD and the Cross-Border Distribution of Funds Directive (CBD). While each directive governs a different part of the value chain, together they define how Europe’s investment ecosystem functions. Understanding how they overlap is no longer just a legal detail, but a strategic advantage.
MiFID II (the Markets in Financial Instruments Directive, 2014/65/EU) sets out the rules for how investment firms should operate. It regulates client protection, governance, market transparency and reporting.
In practice, MiFID II defines who can advise on, execute, and manage investments across the EU and how this must be done. For Dorhyan.eu clients, it’s the baseline; the rulebook that turns professionalism into permission.
The Alternative Investment Fund Managers Directive (AIFMD) (2011/61/EU) extends these principles to fund management. It regulates hedge funds, private equity, and real estate funds, setting standards for authorisation, risk management and investor reporting.
The new AIFMD II reform (Directive 2024/927/EU) strengthens delegation and transparency requirements (learn more from our blog). In other words, compliance is a moving target. For managers, anticipating these changes early can transform complexity into a competitive advantage.
The Cross-Border Distribution of Funds Directive (2019/1160/EU), often called the CBD Directive, closes the loop. It harmonises the marketing of UCITS and AIFs across Europe by defining pre-marketing rules, notification procedures and obligations for investors and facilities.
For the first time, fund structures in one EU country can be promoted in another under consistent rules. In effect, the CBD transforms a previously fragmented system of national regulations into a more integrated European market.
These three directives rarely stand alone.
A single business model might trigger all three: an investment adviser under MiFID II managing an AIF under AIFMD and marketing it across the EU under CBD. Failing to comply with one layer does not just create regulatory risk; it can also slow growth, delay fundraising or limit access to institutional investors.
That’s why Dorhyan.eu helps clients design compliance systems rather than ad hoc solutions. When implemented correctly, compliance enables progress: smoother onboarding, faster market entry and fewer legal barriers between you and your investors.
After all, regulation is not the enemy of growth. In Europe, it’s the foundation of credibility.
Europe’s greater challenge is not ambition, but integration.
The European Securities and Markets Authority (ESMA) is pushing hard for alignment, but local interpretations still differ.
Managers who understand the connections between MiFID II, AIFMD and CBD can grow their businesses faster, make smarter decisions and distribute funds across borders more efficiently. Those who don’t will remain confined by national boundaries and compliance issues.
The market rewards those who are prepared.
Modern investors look for more than just returns; they also expect transparency, ESG alignment and operational efficiency. Every delay or inconsistency in reporting or authorisation translates into lost momentum.
In this sense, structure has become strategy.
At dorhyan.eu, we see compliance as infrastructure.
It’s what turns legal complexity into operational clarity and what transforms regulatory friction into scalability.
By helping fund managers and investment firms align with MiFID II, AIFMD, and CBD from day one, we build the foundations for growth that is both compliant and competitive.
Because in Europe, success doesn’t just depend on capital.
It depends on structure.
And structure begins with compliance.
Sources:
EUR-Lex — “Markets in Financial Instruments Directive (2014/65/EU) — MiFID II.” (Official Journal of the European Union, June 2014)
European Securities and Markets Authority (ESMA) — “MiFID II: Directive 2014/65/EU – Interactive Single Rulebook.” (ESMA, Updated 2024)
Linklaters — “Overview and Updates: Alternative Investment Fund Managers Directive (AIFMD).” (Linklaters, 2024)
Investopedia — “Understanding the Alternative Investment Fund Managers Directive (AIFMD).” (Investopedia Editorial Team, 2024)
FE Fundinfo — “The European Cross-Border Distribution Framework.” (FE Fundinfo Insight, 2023)
Société Générale Securities Services — “Cross-Border Fund Distribution (CBFD): Key Insights.” (Société Générale Securities Services, 2023)
