The Association of Independent Financial Advisers (AIFA) has published new guidance in an attempt to clarify the different requirements of the Markets in Financial Instruments Directive (MiFID).

Deputy director general Fay Goddard explains that the differing needs of firms which have opted into the directive - such as the specific Professional Indemnity (PI) obligations - are causing some confusion among IFAs.

"In order to dispel these myths and half-truths, we are issuing this guidance to reiterate some facts about MiFID and its implications for IFAs," she states.

Among the main myths dismissed by the guidance is the belief that firms which opt in to MiFID are no longer bound by the same regulations as those which are only subject to the jurisdiction of the Financial Services Authority (FSA).

Such firms are still authorised and regulated by the FSA, AIFA observes, but may provide investment advice in other member states of the EU using a MiFID passport.

"You will still be subject to conduct of business and all relevant FSA rules but will have different capital and PI requirements to non-MiFID firms," AIFA adds.

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