Best execution of client orders

(1) An investment services undertaking that executes orders from its clients for the purchase or sale of financial instruments within the meaning of section 2(8), first sentence, nos. 1 to 3, must
1. take all sufficient steps, in particular establishing and regularly reviewing order execution arrangements, to obtain the best possible result for its clients, and
2. ensure that the execution of each individual client order is carried out in accordance with those arrangements. (2) In drawing up its execution arrangements, the investment services undertaking must take into account all relevant criteria for achieving the best possible result, in particular the prices of the financial instruments, the costs associated with the execution of the order, speed, likelihood of execution and settlement, and the size and nature of the order, and must weight those criteria having regard to the characteristics of the client, the client order, the financial instrument and the execution venue.
(3) Where the investment services undertaking executes orders of retail clients, its execution arrangements must include provisions ensuring that the best possible result is determined by reference to the total consideration. The total consideration is made up of the price for the financial instrument and all costs associated with execution of the order. Where an order in a financial instrument can, in accordance with the investment services undertaking's execution arrangements, be executed at several competing venues, the costs also include the investment services undertaking's own commissions or fees charged to the client for an investment service. The costs to be taken into account in calculating the total consideration include the fees and charges of the execution venue at which the transaction is executed, clearing and settlement costs, and any other charges paid to third parties involved in the execution of the order.
(4) Where the investment services undertaking executes an order in accordance with an express client instruction, the duty to obtain the best possible result is deemed satisfied to the extent covered by that instruction.
(5) The order execution arrangements must include
1. particulars of the different execution venues in relation to each class of financial instrument, and the factors determining the choice of an execution venue,
2. at least the execution venues at which the investment services undertaking can consistently obtain the best possible results in executing client orders. Where the execution arrangements within the meaning of subsection (1), no. 1, also permit execution of orders outside trading venues within the meaning of section 2(22), the investment services undertaking must expressly draw its clients' attention to this and obtain their express consent, either generally or in relation to each transaction, before client orders are executed at those execution venues.
(6) The investment services undertaking must
1. inform its clients of its execution arrangements before providing investment services for the first time, and obtain their consent to those arrangements, and
2. notify its clients without delay of any material changes to the arrangements under subsection (1), no. 1. The information on the execution arrangements must explain clearly, in sufficient detail, and in a manner comprehensible to the client, how the investment services undertaking executes client orders.
(7) The investment services undertaking must be able to demonstrate to a client, on request, that the client's order was executed in accordance with the execution arrangements.
(8) An investment services undertaking may not accept any remuneration, rebate or non-monetary benefit, whether for the execution of client orders at a particular trading venue or execution venue, or for the routing of client orders to a particular trading venue or execution venue, where this would constitute a breach of the requirements of section 63(1) to (7) and (9), section 64(1) and (5), sections 70, 80(1), second sentence, no. 2, (9) to (11), or subsections (1) to (4) of this section, or of Article 39a of Regulation (EU) No 600/2014.
(9) Further particulars are laid down in the regulatory technical standards adopted under Article 27(10) of Directive 2014/65/EU, and in Delegated Regulation (EU) 2017/565, in particular on
1. the establishment of execution arrangements under subsections (1) to (5), in Article 64,
2. the review of arrangements under subsection (1), in Article 66,
3. the nature, scope and medium of the information on execution arrangements under subsection (6), in Article 66, and
4. the obligations of investment services undertakings that transmit client orders to third parties for execution, or that carry out financial portfolio management without themselves executing the orders or decisions, to act in the best interests of their clients, in Article 65.