SWEDEN Law and Practice Contributed by: Robert Karlsson, Helena Rönqvist, Caroline Landerfors and Vilma Slättegård, Magnusson Law
• requirements relating to the board of direc - tors and management, including rules relating to the composition and independence of the board of directors, as well as competence and good repute for board members and management. 6.5 Order Handling Rules The SMA and a number of EU regulations con - tain extensive rules regarding order handling and best execution. In general, when executing a client’s order, an investment firm shall take all measures necessary to attain the best possible result for the client in respect of, inter alia, price, cost, etc. The investment firm must also have in place systems and guidelines to enable the institution to attain the best possible result for the client. 6.6 Rise of Peer-to-Peer Trading Platforms When the use of peer-to-peer lending started to grow in Sweden, companies that arranged such platforms were not clearly regulated and super - vised by the SFSA. It was later established that companies that facilitate peer-to-peer lending platforms by providing or intermediating credits to consum - ers must be authorised in accordance with the CCOA. As noted in the foregoing, the Depart - ment of Finance has proposed that the CCOA shall be repealed from 1 July 2025 (subject to certain transitional provisions). Peer-to-peer lending platforms that provide or intermediate consumer loans must thereafter be authorised in accordance with the SBFBA. Certain peer-to-peer business models that facili - tate payments have been authorised pursuant to the PSA.
Crowdfunding platforms that relate to financial instruments must be authorised either under the EU Crowdfunding Regulation or the SMA. Peer-to-peer lending platforms and other lending-based crowdfunding platforms have increased the availability of consumer credits on the market, which has in turn increased the con - sumer risks involved in these types of products. The SFSA has for the last several years identified over-indebtedness as one of the highest-priority consumer risks on the financial market. 6.7 Rules of Payment for Order Flow Payment for order flow is regulated by the Mar - kets in Financial Instruments Regulation (MiFIR). Article 39a of MiFIR stipulates that investment firms that are acting on behalf of retail clients or certain professional clients are prohibited from receiving any fee, commission or non-monetary benefit from any third party for executing orders from those clients on a particular execution ven - ue or for forwarding orders of those clients to any third party for their execution on a particular execution venue. The prohibition against payment for order flow does not apply to rebates or discounts on the transaction fees of execution venues, if such rebates or discounts are permitted under the approved and public tariff structure of a trad - ing venue and as long the rebates or discounts exclusively benefit the client. Such discounts or rebates may not result in a monetary benefit to the investment firm. In addition to the foregoing, according to the SMA and supplementing regulations issued by the SFSA, investment firms may accept fees or commissions, or other non-monetary benefits, from a third party only if the payment or benefit is designed to enhance the quality of the relevant
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