MORGAN STANLEY

UK PROSPECTUS

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as Issuer

(incorporated under the laws of the State of Delaware in the United States of America)

€1,250,000,000 Floating Rate Senior Registered Notes Due 2019 (the " Notes ")

This prospectus (this " UK Prospectus ") comprises (i) this document, and (ii) the documents and information specified in the section headed "Incorporation by Reference" below.

Application has been made to the United Kingdom Financial Conduct Authority (the " FCA ") in its capacity as United Kingdom competent authority for the purposes of Directive 2003/71/EC (the " Prospectus Directive ") and relevant implementing measures in the United Kingdom to approve this UK Prospectus. Application will be made for the Notes to be admitted to the Official List of the FCA and to trading on the Regulated Market of the London Stock Exchange plc (the " London Stock Exchange "), a regulated market for the purposes of Directive 2004/39/EC (the Markets in Financial Instruments Directive). This UK Prospectus constitutes a prospectus for the purposes of Section 87G of the Financial Services and Markets Act 2000, as amended. This UK Prospectus has been prepared for the purpose of the admission of the Notes to trading on the Regulated Market of the London Stock Exchange.

Investing in the Notes involves risks. See " Risk Factors " beginning on page 1.

THE NOTES ARE NOT BANK DEPOSITS AND ARE NOT INSURED BY THE UNITED STATES FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY, NOR ARE THEY OBLIGATIONS OF, OR GUARANTEED BY, A BANK.

THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION AND STATE SECURITIES REGULATORS HAVE NOT APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED IF THIS UK PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE.

Neither Morgan Stanley (the "Issuer") nor Morgan Stanley & Co. International plc (the "Agent" or "MSI plc") has taken or will take any action in any country or jurisdiction that would permit a public offering of the Notes or possession or distribution of any offering material in relation to a public offering in any country or jurisdiction outside the United States where action for that purpose is required. Each investor must comply with all applicable laws and regulations in each country or jurisdiction in or from which the investor purchases, offers, sells or delivers such Notes or has in the investor's possession or distributes this UK Prospectus.

Morgan Stanley's short-term and long-term debt has been respectively rated (i) R-1 (middle) and A (high), with a stable outlook, by DBRS, Inc. (" DBRS "), (ii) F1 and A, with a stable outlook, by Fitch Ratings, Inc. (" Fitch "), (iii) P- 2 and Baa2, with a positive outlook, by Moody's Investors Service, Inc. (" Moody's "), (iv) a-1 and A, with a negative outlook, by Ratings and Investment Information, Inc. (" R&I ") and (v) A-2 and A-, with a negative outlook, by Standard & Poor's Financial Services LLC through its business unit Standard & Poor's Ratings Services (" S&P ").

DBRS is not established in the European Economic Area (the " EEA ") but the rating it has assigned to Morgan Stanley may be endorsed by DBRS Ratings Limited, a rating agency which is established in the EEA and registered under Regulation 1060/2009 of the European Parliament and of the Council of 16 September 2009 on credit rating agencies, as amended (the " CRA Regulation ") by the relevant competent authority.

Fitch is not established in the EEA but the rating it has assigned to Morgan Stanley is endorsed by Fitch Ratings Limited, a rating agency established in the EEA and registered under the CRA Regulation by the relevant competent authority.

Moody's is not established in the EEA but the rating it has assigned to Morgan Stanley is endorsed by Moody's Investors Service Limited, a rating agency established in the EEA and registered under the CRA Regulation by the relevant competent authority.

R&I is not incorporated in the EEA and is not registered under the CRA Regulation.

S&P is not established in the EEA but the rating it has assigned to Morgan Stanley is, with effect from 9 April 2012, endorsed by Standard & Poor’s Credit Market Services Europe Limited, a rating agency established in the EEA and registered under the CRA Regulation by the relevant competent authority.

17 December 2014

This UK Prospectus comprises a prospectus for the purposes of Article 5 of the Prospectus Directive.

Morgan Stanley accepts responsibility for the information contained in this UK Prospectus. To the best of the knowledge and belief of Morgan Stanley (which has taken all reasonable care to ensure that such is the case), the information contained in this UK Prospectus is in accordance with the facts and does not omit anything likely to affect the import of such information.

No person has been authorised by Morgan Stanley to give any information or to make any representation not contained or incorporated by reference in this UK Prospectus or any other document entered into in relation to the Notes, and, if given or made, that information or representation should not be relied upon as having been authorised by Morgan Stanley or the Agent. Neither the delivery of this UK Prospectus nor the offering, sale or delivery of any Notes will, in any circumstances, create any implication that the information contained in this UK Prospectus is true subsequent to the date hereof or the date upon which this UK Prospectus has been most recently amended or supplemented, or that there has been no adverse change in the financial situation of Morgan Stanley since the date hereof or, as the case may be, the date upon which this UK Prospectus has been most recently amended or supplemented, or that any other information supplied in connection with the Notes is correct at any time subsequent to the date on which it is supplied or, if different, the date indicated in the document containing the same. The Agent expressly does not undertake to review the financial condition or affairs of Morgan Stanley during the life of the Notes. Investors should review, inter alia , the most recent financial statements of Morgan Stanley when evaluating the Notes or an investment therein. Such financial statements shall not form a part of this UK Prospectus unless they have been expressly incorporated herein. In case of any websites mentioned in this UK Prospectus, neither Morgan Stanley nor the Agent accepts responsibility for the information appearing on such websites. For the avoidance of doubt, the information appearing on such websites and pages does not form part of this UK Prospectus save to the extent expressly incorporated by reference herein.

The Agent has not separately verified the information contained herein. Accordingly, no representation, warranty or undertaking, express or implied, is made and no responsibility is accepted by the Agent as to the accuracy or completeness of this UK Prospectus or any document incorporated by reference herein or any further information supplied in connection with the Notes. The Agent does not accept liability in relation to this UK Prospectus or any document incorporated by reference herein or their distribution or with regard to any other information supplied by or on behalf of Morgan Stanley.

The distribution of this UK Prospectus and the offering, sale and delivery of the Notes in certain jurisdictions may be restricted by law. Persons into whose possession this UK Prospectus comes are required by Morgan Stanley and the Agent to inform themselves about and to observe those restrictions.

This UK Prospectus may not be used for the purpose of an offer or solicitation by anyone in any jurisdiction in which that offer or solicitation is not authorised or to any person to whom it is unlawful to make such an offer or solicitation.

This UK Prospectus does not constitute an offer of or an invitation to subscribe for or purchase any Notes and should not be considered as a recommendation by Morgan Stanley or the Agent that any recipient of this UK Prospectus should subscribe for or purchase any Notes. Each recipient of this UK Prospectus will be taken to have made its own investigation and appraisal of the condition (financial or otherwise) of Morgan Stanley and of the terms of the Notes.

Prospective investors should consult their own legal and financial advisors as to any specific risks for them in the light of their own circumstances entailed by the purchase of, or holding of, or the receipt of any payments on the Notes or otherwise by an investment in the Notes, for example, as a result of their being residents of or subject to tax in any jurisdiction.

Save as disclosed in the paragraphs beginning with "Residential Mortgage and Credit Crisis Related Matters" in Part I – Item 3 entitled "Legal Proceedings" at pages 35 to 46 and in the paragraphs beginning with "Legal" under the heading "Contingencies" in Part 2 – Item 8 entitled "Notes to Consolidated Financial Statements" at pages 239 to 243 of Morgan Stanley's Annual

Report on Form 10-K for the fiscal year ended 31 December 2013, in the paragraphs beginning with "Residential Mortgage and Credit Crisis Related Matters" in Part II – Item 1 entitled "Legal Proceedings" at pages 166 to 167 and in the paragraphs beginning with "Legal" under the heading "Contingencies" in Part I – Item 1 entitled "Notes to Condensed Consolidated Financial Statements" at pages 76 to 80 of Morgan Stanley's Quarterly Report on Form 10-Q for the quarterly period ended 31 March 2014, in the paragraphs beginning with "Residential Mortgage and Credit Crisis Related Matters" in Part II – Item 1 entitled "Legal Proceedings" at pages 174 to 176 and in the paragraphs beginning with "Legal" under the heading "Contingencies" in Part I – Item 1 entitled "Notes to Condensed Consolidated Financial Statements" at pages 75 to 80 of Morgan Stanley's Quarterly Report on Form 10-Q for the quarterly period ended 30 June 2014 and in the paragraphs beginning with "Residential Mortgage and Credit Crisis Related Matters" in Part II – Item 1 entitled "Legal Proceedings" at pages 183 to 184 and in the paragraphs beginning with "Legal" under the heading "Contingencies" in Part I – Item 1 entitled "Notes to Condensed Consolidated Financial Statements" at pages 76 to 81 of Morgan Stanley's Quarterly Report on Form 10-Q for the quarterly period ended 30 September 2014, there are no governmental, legal or arbitration proceedings (including any such proceedings which are pending or threatened of which Morgan Stanley is aware) during the 12-month period before the date of this UK Prospectus which may have, or have had in the recent past, a significant effect on Morgan Stanley or the financial position or profitability of Morgan Stanley or Morgan Stanley's group consisting of Morgan Stanley and its consolidated subsidiaries (the "Morgan Stanley Group").

There has been no significant change in the financial or trading position of the Morgan Stanley Group since 30 September 2014.

There has been no material adverse change in the prospects of Morgan Stanley since 31 December 2013. There are no recent events particular to Morgan Stanley which are to a material extent relevant to the evaluation of Morgan Stanley's solvency.

The issue of the Notes was approved by resolutions of the board of directors of Morgan Stanley held on 14 June 2004, 20 September 2005, 11 November 2005, 12 October 2006, 18 March 2007, 16 June 2008, 20 October 2009, 19 October 2010, 18 October 2011, 23 October 2012 and 31 October 2014.

Total expenses related to the admission to trading of the Notes is about GBP 2,750. The interest rate on the Notes will be equivalent to the Base Rate based on the Index Maturity plus the Spread. This is not an indication of future yield.

Morgan Stanley does not intend to provide any post-issuance information in respect of the Notes.

THE NOTES HAVE NOT BEEN RECOMMENDED BY ANY UNITED STATES FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE.

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Risk Factors ............................................................................................................................................................ 1 Incorporation by Reference .................................................................................................................................. 14 Description of Morgan Stanley ............................................................................................................................ 18 Description of the Notes ....................................................................................................................................... 19 United Kingdom Taxation .................................................................................................................................... 32 United States Federal Taxation ............................................................................................................................ 33 Plan of Distribution .............................................................................................................................................. 38 Use of Proceeds .................................................................................................................................................... 41 Benefit Plan Investor Considerations ................................................................................................................... 42

RISK FACTORS

This section describes the principal risks of investing in the Notes. Prospective investors should read the entire UK Prospectus. Words and expressions defined elsewhere in this UK Prospectus have the same meanings in this section. Prospective investors should consider, among other things, the following:

RISKS RELATING TO MORGAN STANLEY

The following are risks that may affect Morgan Stanley and its ability to fulfil its obligations under the Notes.

Liquidity and Funding Risk

Liquidity and funding risk refers to the risk that Morgan Stanley will be unable to finance its operations due to a loss of access to the capital markets or difficulty in liquidating its assets. Liquidity and funding risk also encompasses its ability to meet its financial obligations, including the Notes, without experiencing significant business disruption or reputational damage that may threaten its viability as a going concern. For more information on how Morgan Stanley monitors and manages liquidity and funding risk, see "Management's Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources" in Part II, Item 7 of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” in Part I, Item 2 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 31 March 2014, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” in Part I, Item 2 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 30 June 2014 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” in Part I, Item 2 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 30 September 2014, which have been incorporated by reference on pages 14 to 17 of this UK Prospectus.

Liquidity is essential to Morgan Stanley's businesses and Morgan Stanley relies on external sources to finance a significant portion of Morgan Stanley's operations.

Liquidity is essential to Morgan Stanley's businesses. Morgan Stanley's liquidity could be negatively affected by its inability to raise funding in the long-term or short-term debt capital markets or its inability to access the secured lending markets. Factors that Morgan Stanley cannot control, such as disruption of the financial markets or negative views about the financial services industry generally, including concerns regarding the remaining sovereign debt issues in Europe or fiscal matters in the U.S., could impair its ability to raise funding. In addition, Morgan Stanley's ability to raise funding could be impaired if investors or lenders develop a negative perception of its long-term or short-term financial prospects due to factors such as if it were to incur large trading losses, are downgraded by the rating agencies, suffer a decline in the level of its business activity, or if regulatory authorities take significant action against it, or it discovers significant employee misconduct or illegal activity. If Morgan Stanley is unable to raise funding using the methods described above, it would likely need to finance or liquidate unencumbered assets, such as its investment and trading portfolios, to meet maturing liabilities. Morgan Stanley may be unable to sell some of its assets, or it may have to sell assets at a discount from market value, either of which could adversely affect its results of operations, cash flows and financial condition, including with respect to the Notes.

Morgan Stanley's borrowing costs and access to the debt capital markets depend significantly on Morgan Stanley's credit ratings.

The cost and availability of unsecured financing generally are impacted by Morgan Stanley's short-term and long-term credit ratings. The rating agencies are continuing to monitor certain issuer specific factors that are important to the determination of Morgan Stanley's credit ratings, including governance, the level and quality of earnings, capital adequacy, funding and liquidity, risk appetite and management, asset quality, strategic direction, and business mix. Additionally, the rating agencies will look at other industrywide factors such as regulatory or legislative changes, macro-economic environment, and perceived levels of government support, and it is possible that they could downgrade Morgan Stanley's ratings and those of similar institutions. For example, in November 2013, Moody's took certain ratings actions with

respect to eight large U.S. banking groups, including downgrading Morgan Stanley, to remove certain uplift from the U.S. government support in their ratings. See also "Management’s Discussion and Analysis of Financial Condition and Results of Operation—Liquidity and Capital Resources—Credit Ratings" in Part II, Item 7 of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” in Part I, Item 2 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 31 March 2014, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” in Part I, Item 2 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 30 June 2014 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” in Part I, Item 2 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 30 September 2014, which have been incorporated by reference on pages 14 to 17 of this UK Prospectus.

The Notes are senior unsecured obligations of Morgan Stanley, and all payments on the Notes, including the repayment of principal, are subject to the credit risk of Morgan Stanley

Morgan Stanley is a holding company and depends on payments from Morgan Stanley's subsidiaries.

Morgan Stanley is a parent holding company and depends on dividends, distributions and other payments from its subsidiaries to fund dividend payments and to fund all payments on its obligations, including debt obligations, such as the Notes. Regulatory, tax restrictions or elections and other legal restrictions may limit Morgan Stanley's ability to transfer funds freely, either to or from its subsidiaries. In particular, many of Morgan Stanley's subsidiaries, including its broker-dealer subsidiaries, are subject to laws, regulations and self-regulatory organization rules that authorize regulatory bodies to block or reduce the flow of funds to the parent holding company, or that prohibit such transfers altogether in certain circumstances, including steps to "ring fence" entities by regulators outside of the U.S. to protect clients and creditors of such entities in the event of financial difficulties involving such entities. These laws, regulations and rules may hinder its ability to access funds that Morgan Stanley may need to make payments on its obligations, including the Notes. Furthermore, the Office of the Comptroller of the Currency, the Federal Reserve, the Federal Deposit Insurance Corporation (the " FDIC ") and other regulators with supervisory authority over one or more of Morgan Stanley's bank company subsidiaries have the authority, and under certain circumstances, the duty, to prohibit or to limit the payment of dividends by the banking organizations they supervise, including Morgan Stanley's bank company subsidiaries.

Morgan Stanley's liquidity and financial condition have in the past been, and in the future could be, adversely affected by U.S. and international markets and economic conditions.

Morgan Stanley's ability to raise funding in the long-term or short-term debt capital markets or the equity markets, or to access secured lending markets, has in the past been, and could in the future be, adversely affected by conditions in the U.S. and international markets and economy. Global market and economic conditions have been particularly disrupted and volatile in the last several years and continue to be, including as a result of the European sovereign debt crisis, and uncertainty regarding U.S. fiscal matters. In particular, its cost and availability of funding have been, and may in the future be, adversely affected by illiquid credit markets and wider credit spreads. Continued turbulence in the U.S., the E.U. and other international markets and economies could adversely affect its liquidity and financial condition, including with respect to the Notes, and the willingness of certain counterparties and customers to do business with it.

Market Risk

Market risk refers to the risk that a change in the level of one or more market prices, rates, indices, implied volatilities (the price volatility of the underlying instrument imputed from option prices), correlations or other market factors, such as market liquidity, will result in losses for a position or portfolio owned by Morgan Stanley. For more information on how Morgan Stanley monitors and manages market risk, see "Quantitative and Qualitative Disclosures about Market Risk" in Part II, Item 7A of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, "Quantitative and Qualitative Disclosures about Market Risk" in Part I, Item 3 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 31 March 2014, "Quantitative and Qualitative Disclosures about Market Risk" in Part I, Item 3 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 30 June 2014 and "Quantitative and Qualitative Disclosures about Market Risk" in Part

I, Item 3 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 30 September 2014, which have been incorporated by reference on pages 14 to 17 of this UK Prospectus.

Morgan Stanley's results of operations may be materially affected by market fluctuations and by global and economic conditions and other factors.

Morgan Stanley's results of operations may be materially affected by market fluctuations due to global and economic conditions and other factors. Morgan Stanley's results of operations in the past have been, and in the future may continue to be, materially affected by many factors, including the effect of economic and political conditions and geopolitical events; the effect of market conditions, particularly in the global equity, fixed income, credit and commodities markets, including corporate and mortgage (commercial and residential) lending and commercial real estate markets; the impact of current, pending and future legislation (including the Dodd-Frank Wall Street Reform and Consumer Protection Act (the " Dodd-Frank Act ")), regulation (including capital, leverage and liquidity requirements), policies (including fiscal and monetary), policies (including fiscal and monetary) and legal and regulatory actions in the U.S. and worldwide; the level and volatility of equity, fixed income and commodity prices, interest rates, currency values and other market indices; the availability and cost of both credit and capital as well as the credit ratings assigned to Morgan Stanley's unsecured short-term and long-term debt; investor, consumer and business sentiment and confidence in the financial markets; the performance of its acquisitions, divestitures, joint ventures, strategic alliances or other strategic arrangements; its reputation; inflation, natural disasters, and acts of war or terrorism; the actions and initiatives of current and potential competitors, as well as governments, regulators and self-regulatory organizations; the effectiveness of its risk management policies; and technological changes and risks, including cybersecurity risks; or a combination of these or other factors. In addition, legislative, legal and regulatory developments related to its businesses are likely to increase costs, thereby affecting results of operations. These factors also may have an adverse impact on its ability to achieve its strategic objectives.

The results of Morgan Stanley's Institutional Securities business segment, particularly results relating to its involvement in primary and secondary markets for all types of financial products, are subject to substantial fluctuations due to a variety of factors, such as those enumerated above that Morgan Stanley cannot control or predict with great certainty. These fluctuations impact results by causing variations in new business flows and in the fair value of securities and other financial products. Fluctuations also occur due to the level of global market activity, which, among other things, affects the size, number and timing of investment banking client assignments and transactions and the realization of returns from its principal investments. During periods of unfavorable market or economic conditions, the level of individual investor participation in the global markets, as well as the level of client assets, may also decrease, which would negatively impact the results of Morgan Stanley's Wealth Management business segment. In addition, fluctuations in global market activity could impact the flow of investment capital into or from assets under management or supervision and the way customers allocate capital among money market, equity, fixed income or other investment alternatives, which could negatively impact its Investment Management business segment.

Morgan Stanley may experience declines in the value of Morgan Stanley's financial instruments and other losses related to volatile and illiquid market conditions.

Market volatility, illiquid market conditions and disruptions in the credit markets make it extremely difficult to value certain of its securities, particularly during periods of market displacement. Subsequent valuations, in light of factors then prevailing, may result in significant changes in the values of these securities in future periods. In addition, at the time of any sales and settlements of these securities, the price Morgan Stanley ultimately realize will depend on the demand and liquidity in the market at that time and may be materially lower than their current fair value. Any of these factors could cause a decline in the value of Morgan Stanley's securities portfolio, which may have an adverse effect on its results of operations in future periods.

In addition, financial markets are susceptible to severe events evidenced by rapid depreciation in asset values accompanied by a reduction in asset liquidity. Under these extreme conditions, hedging and other risk management strategies may not be as effective at mitigating trading losses as they would be under more normal market conditions. Moreover, under these conditions market participants are particularly exposed to trading strategies employed by many market participants simultaneously and on a large scale, such as crowded trades. Morgan Stanley's risk management and monitoring processes seek to quantify and mitigate risk to more extreme market moves. However, severe market events have historically been

difficult to predict, as seen in the last several years, and Morgan Stanley could realize significant losses if extreme market events were to occur.

Holding large and concentrated positions may expose Morgan Stanley to losses.

Concentration of risk may reduce revenues or result in losses in Morgan Stanley's market-making, investing, block trading, underwriting and lending businesses in the event of unfavorable market movements. Morgan Stanley commits substantial amounts of capital to these businesses, which often results in its taking large positions in the securities of, or making large loans to, a particular issuer or issuers in a particular industry, country or region.

Morgan Stanley has incurred, and may continue to incur, significant losses in the real estate sector.

Morgan Stanley finances and acquires principal positions in a number of real estate and real estate-related products for its own account, for investment vehicles managed by affiliates in which it also may have a significant investment, for separate accounts managed by affiliates and for major participants in the commercial and residential real estate markets.

Morgan Stanley also originates loans secured by commercial and residential properties. Further, it securitizes and trades in a wide range of commercial and residential real estate and real estate-related whole loans, mortgages and other real estate and commercial assets and products, including residential and commercial mortgage-backed securities. These businesses have been, and may continue to be, adversely affected by the downturn in the real estate sector. In connection with these activities, Morgan Stanley has provided, or otherwise agreed to be responsible for, certain representations and warranties. Under certain circumstances, it may be required to repurchase such assets or make other payments related to such assets if such representations and warranties were breached. Between 2004 and December 31, 2013, it sponsored approximately $148.0 billion of residential mortgage-backed securities (" RMBS ") primarily containing U.S. residential loans. Of that amount, Morgan Stanley made representations and warranties concerning approximately $47.0 billion of loans and agreed to be responsible for the representations and warranties made by third-party sellers, many of which are now insolvent, on approximately $21.0 billion of loans. At December 31, 2013, the current unpaid principal balance ("UPB") for all the residential assets subject to such representations and warranties was approximately $17.2 billion and the cumulative losses associated with U.S. RMBS were approximately $13.5 billion. Morgan Stanley did not make, or otherwise agree to be responsible, for the representations and warranties made by third party sellers on approximately $79.9 billion of residential loans that it securitized during that time period. Morgan Stanley has not sponsored any U.S. RMBS transactions since 2007.

Morgan Stanley has also made representations and warranties in connection with its role as an originator of certain commercial mortgage loans that it securitized in commercial mortgage-backed securities (" CMBS "). Between 2004 and December 31, 2013, Morgan Stanley originated approximately $50.6 billion and $13.0 billion of U.S. and non-U.S. commercial mortgage loans, respectively, that were placed into CMBS sponsored by it. At December 31, 2013, the current UPB for all U.S. commercial mortgage loans subject to such representations and warranties was $33.0 billion. At December 31, 2013, the current UPB when known for all non-U.S. commercial mortgage loans, subject to such representations and warranties was approximately $3.0 billion and the UPB at the time of sale when the current UPB is not known was $0.4 billion.

Over the last several years, the level of litigation and investigatory activity (both formal and informal) by government and self-regulatory agencies has increased materially in the financial services industry. As a result, Morgan Stanley has been and expects that it may continue to become, the subject of increased claims for damages and other relief in the future. Morgan Stanley continues to monitor its real estaterelated activities in order to manage its exposures and potential liability from these markets and businesses. See "Legal Proceedings—Residential Mortgage and Credit Crisis Related Matters" in Part I, Item 3 of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, "Legal Proceedings—Residential Mortgage and Credit Crisis Related Matters" in Part II, Item 1 of Morgan Stanley's Quarterly Report on Form 10-Q for the quarter ended 31 March 2014, "Legal Proceedings— Residential Mortgage and Credit Crisis Related Matters" in Part II, Item 1 of Morgan Stanley's Quarterly Report on Form 10-Q for the quarter ended 30 June 2014 and "Legal Proceedings—Residential Mortgage and Credit Crisis Related Matters" in Part II, Item 1 of Morgan Stanley's Quarterly Report on Form 10-Q for the quarter ended 30 September 2014, which have all been incorporated by reference on pages 14 to 17 of this UK Prospectus.

Credit Risk

Credit risk refers to the risk of loss arising when a borrower, counterparty or issuer does not meet its financial obligations to Morgan Stanley. For more information on how Morgan Stanley monitors and manages credit risk, see "Quantitative and Qualitative Disclosures about Market Risk—Risk Management—Credit Risk" in Part II, Item 7A of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, "Quantitative and Qualitative Disclosures about Market Risk" in Part I, Item 3 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 31 March 2014, "Quantitative and Qualitative Disclosures about Market Risk" in Part I, Item 3 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 30 June 2014 and "Quantitative and Qualitative Disclosures about Market Risk" in Part I, Item 3 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 30 September 2014, which have been incorporated by reference on pages 14 to 17 of this UK Prospectus.

Morgan Stanley is exposed to the risk that third parties that are indebted to Morgan Stanley will not perform their obligations.

Morgan Stanley incurs significant credit risk exposure through the Institutional Securities business segment. This risk may arise from a variety of business activities, including but not limited to entering into swap or other derivative contracts under which counterparties have obligations to make payments to it; extending credit to clients through various lending commitments; providing short or long-term funding that is secured by physical or financial collateral whose value may at times be insufficient to fully cover the loan repayment amount; posting margin and/or collateral and other commitments to clearing houses, clearing agencies, exchanges, banks, securities firms and other financial counterparties; and investing and trading in securities and loan pools whereby the value of these assets may fluctuate based on realized or expected defaults on the underlying obligations or loans.

Morgan Stanley also incurs credit risk in the Wealth Management business segment lending to individual investors, including, but not limited to, margin and securities-based loans collateralized by securities, residential mortgage loans and home equity lines of credit.

While Morgan Stanley believes current valuations and reserves adequately address its perceived levels of risk, there is a possibility that adverse difficult economic conditions may negatively impact its clients and its current credit exposures. In addition, as a clearing member firm, Morgan Stanley finances its customer positions and it could be held responsible for the defaults or misconduct of its customers. Although Morgan Stanley regularly reviews its credit exposures, default risk may arise from events or circumstances that are difficult to detect or foresee.

A default by a large financial institution could adversely affect financial markets generally.

The commercial soundness of many financial institutions may be closely interrelated as a result of credit, trading, clearing or other relationships between the institutions. For example, increased centralization of trading activities through particular clearing houses, central agents or exchanges as required by provisions of the Dodd-Frank Act may increase its concentration of risk with respect to these entities. As a result, concerns about, or a default or threatened default by, one institution could lead to significant market-wide liquidity and credit problems, losses or defaults by other institutions. This is sometimes referred to as "systemic risk" and may adversely affect financial intermediaries, such as clearing agencies, clearing houses, banks, securities firms and exchanges, with which Morgan Stanley interacts on a daily basis, and therefore could adversely affect it. See also "Systemic Risk Regime" under "Business—Supervision and Regulation—Financial Holding Company" in Part I, Item 1 of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, which has been incorporated by reference on page 14 of this UK Prospectus.

Operational Risk

Operational risk refers to the risk of loss, or of damage to Morgan Stanley's reputation, resulting from inadequate or failed processes, people and systems or from external events ( e.g. , fraud, legal and compliance risks or damage to physical assets). Morgan Stanley may incur operational risk across the full scope of its business activities, including revenue generating activities ( e.g. , sales and trading) and control groups ( e.g. , information technology and trade processing). Legal, regulatory and compliance risk is included in the scope of operational risk and is discussed below under "Legal, Regulatory and

Compliance Risk." For more information on how Morgan Stanley monitors and manages operational risk, see "Quantitative and Qualitative Disclosures about Market Risk—Risk Management—Operational Risk" in Part II, Item 7A of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, which has been incorporated by reference on page 14 of this UK Prospectus.

Morgan Stanley is subject to operational risk that could adversely affect Morgan Stanley's businesses.

Morgan Stanley's businesses are highly dependent on its ability to process, on a daily basis, a large number of transactions across numerous and diverse markets in many currencies. In addition, Morgan Stanley may introduce new products or services or change processes, resulting in new operational risk that it may not fully appreciate or identify. In general, the transactions Morgan Stanley processes are increasingly complex. It performs the functions required to operate its different businesses either by itself or through agreements with third parties. Morgan Stanley relies on the ability of its employees, its internal systems and systems at technology centers operated by unaffiliated third parties to process a high volume of transactions.

Morgan Stanley also face the risk of operational failure or termination of any of the clearing agents, exchanges, clearing houses or other financial intermediaries it uses to facilitate its securities transactions. In the event of a breakdown or improper operation of its or a third party's systems or improper or unauthorized action by third parties or its employees, it could suffer financial loss, an impairment to its liquidity, a disruption of its businesses, regulatory sanctions or damage to its reputation. In addition, the interconnectivity of multiple financial institutions with central agents, exchanges and clearing houses, and the increased importance of these entities, increases the risk that an operational failure at one institution or entity may cause an industry-wide operational failure that could materially impact Morgan Stanley's ability to conduct business.

Morgan Stanley's operations rely on the secure processing, storage and transmission of confidential and other information in its computer systems and the systems of third parties with which it does business or that facilitate its business activities, such as vendors. Like other financial services firms, Morgan Stanley and its third party providers have been and continue to be subject to unauthorized access, mishandling or misuse, computer viruses or malware, cyber attacks, denial of service attacks and other events. The increased use of smartphones, tablets and other mobile devices may also heighten these and other operational risks. Events such as these could have a security impact on its systems and jeopardize its or its clients' or counterparties' personal, confidential, proprietary or other information processed and stored in, and transmitted through, its and its third party providers' computer systems. Furthermore, such events could cause interruptions or malfunctions in its, its clients', its counterparties' or third parties' operations, which could result in reputational damage, client dissatisfaction, litigation or regulatory fines or penalties not covered by insurance maintained by it, and adversely affect its business, financial condition, including with respect to the Notes, or results of operations.

Despite the business contingency plans Morgan Stanley has in place, there can be no assurance that such plans will fully mitigate all potential business continuity risks to it. Morgan Stanley's ability to conduct business may be adversely affected by a disruption in the infrastructure that supports its business and the communities where Morgan Stanley is located, which are concentrated in the New York metropolitan area, London, Hong Kong and Tokyo. This may include a disruption involving physical site access, terrorist activities, disease pandemics, catastrophic events, natural disasters, extreme weather events, electrical, environmental, computer servers, communications or other services it uses, Morgan Stanley's employees or third parties with whom it conducts business.

Legal, Regulatory and Compliance Risk

Legal, regulatory and compliance risk includes the risk of legal or regulatory sanctions, material financial loss including fines, penalties, judgments, damages and/or settlements, or loss to reputation Morgan Stanley may suffer as a result of its failure to comply with laws, regulations, rules, related self-regulatory organization standards and codes of conduct applicable to its business activities. Legal, regulatory and compliance risk also includes contractual and commercial risk such as the risk that a counterparty's performance obligations will be unenforceable. In today's environment of rapid and possibly transformational regulatory change, Morgan Stanley also views regulatory change as a component of legal, regulatory and compliance risk. For more information on how Morgan Stanley monitors and manages legal, regulatory and compliance risk, see "Quantitative and Qualitative Disclosures about Market Risk—Risk Management—Legal, Regulatory and Compliance Risk" in Part II, Item 7A of

Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, which has been incorporated by reference on page 14 of this UK Prospectus.

The financial services industry is subject to extensive regulation, which is undergoing major changes that will impact Morgan Stanley's business.

Like other major financial services firms, Morgan Stanley is subject to extensive regulation by U.S. federal and state regulatory agencies and securities exchanges and by regulators and exchanges in each of the major markets where Morgan Stanley conducts its business. These laws and regulations significantly affect the way Morgan Stanley does business, and can restrict the scope of its existing businesses and limit its ability to expand its product offerings and pursue certain investments.

In response to the financial crisis, legislators and regulators, both in the U.S. and worldwide, have adopted, or are currently considering enacting, financial market reforms that have resulted and could result in major changes to the way Morgan Stanley's global operations are regulated. In particular, as a result of the Dodd-Frank Act, it is, or will become, subject to (among other things) significantly revised and expanded regulation and supervision, to more intensive scrutiny of its businesses and any plans for expansion of those businesses, to new activities limitations, to a systemic risk regime that imposes heightened capital and liquidity requirements to new restrictions on activities and investments imposed by the Volcker Rule, and to comprehensive new derivatives regulation. While certain portions of the DoddFrank Act became effective immediately, most other portions are effective following transition periods or through numerous rulemakings by multiple governmental agencies, and although a large number of rules have been proposed, many are still subject to final rulemaking or transition periods. U.S. regulators also plan to propose additional regulations to implement the Dodd-Frank Act. Many of the changes required by the Dodd-Frank Act could materially impact the profitability of its businesses and the value of assets Morgan Stanley holds, expose Morgan Stanley to additional costs, require changes to business practices or force Morgan Stanley to discontinue businesses, adversely affect its ability to pay dividends and repurchase its stock, or require Morgan Stanley to raise capital, including in ways that may adversely impact its shareholders or creditors. In addition, similar regulatory requirements are being proposed by foreign policymakers and regulators, which may be inconsistent or conflict with regulations that Morgan Stanley is subject to in the U.S. and, if adopted may adversely affect it. While there continues to be uncertainty about the full impact of these changes, Morgan Stanley do know that Morgan Stanley will be subject to a more complex regulatory framework, and will incur costs to comply with new requirements as well as to monitor for compliance in the future.

For example, the Volcker Rule provision of the Dodd-Frank Act will have an impact on it, including potentially limiting various aspects of Morgan Stanley's business. Morgan Stanley is continuing its review of activities that may be affected by the Volcker Rule, including its trading operations and asset management activities, and are taking steps to establish the necessary compliance programs to comply with the Volcker Rule. Given the complexity of the new framework, the full impact of the Volcker Rule is still uncertain, and will ultimately depend on the interpretation and implementation by the five regulatory agencies responsible for its oversight.

The financial services industry faces substantial litigation and is subject to extensive regulatory investigations, and Morgan Stanley may face damage to Morgan Stanley's reputation and legal liability.

As a global financial services firm, Morgan Stanley faces the risk of investigations and proceedings by governmental and self-regulatory organizations in all countries in which it conducts its business. Interventions by authorities may result in adverse judgments, settlements, fines, penalties, injunctions or other relief. In addition to the monetary consequences, these measures could, for example, impact its ability to engage in, or impose limitations on, certain of its businesses. The number of these investigations and proceedings, as well as the amount of penalties and fines sought, has increased substantially in recent years with regard to many firms in the financial services industry, including Morgan Stanley. Significant regulatory action against Morgan Stanley could materially adversely affect its business, financial condition or results of operations or cause it significant reputational harm, which could seriously harm its business. The Dodd-Frank Act also provides compensation to whistleblowers who present the SEC or CFTC with information related to securities or commodities laws violations that lead to a successful enforcement action. As a result of this compensation, it is possible Morgan Stanley could face an increased number of investigations by the SEC or CFTC.

Morgan Stanley has been named, from time to time, as a defendant in various legal actions, including arbitrations, class actions, and other litigation, as well as investigations or proceedings brought by regulatory agencies, arising in connection with its activities as a global diversified financial services institution. Certain of the actual or threatened legal or regulatory actions include claims for substantial compensatory and/or punitive damages, claims for indeterminate amounts of damages, or may result in penalties, fines, or other results adverse to it. In some cases, the issuers that would otherwise be the primary defendants in such cases are bankrupt or in financial distress. Like any large corporation, Morgan Stanley is also subject to risk from potential employee misconduct, including non-compliance with policies and improper use or disclosure of confidential information.

Substantial legal liability could materially adversely affect Morgan Stanley's business, financial condition or results of operations or cause Morgan Stanley significant reputational harm, which could seriously harm its business. For example, over the last several years, the level of litigation and investigatory activity (both formal and informal) by government and self-regulatory agencies has increased materially in the financial services industry. As a result, Morgan Stanley has been, and expect that it may continue to become, the subject of increased claims for damages and other relief in the future and there can be no assurance that additional material losses will not be incurred from claims that have not yet been asserted or are not yet determined to be material. For more information regarding legal proceedings in which Morgan Stanley is involved see "Legal Proceedings" in Part I, Item 3 of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, Morgan Stanley's Current Report on Form 8-K dated 4 February 2014, "Contingencies" in Part I, Item 1 and "Legal Proceedings" in Part II, Item 1 of Morgan Stanley's Quarterly Report on Form 10-Q for the quarter ended 31 March 2014, "Contingencies" in Part I, Item 1 and "Legal Proceedings" in Part II, Item 1 of Morgan Stanley's Quarterly Report on Form 10-Q for the quarter ended 30 June 2014 and "Contingencies" in Part I, Item 1 and "Legal Proceedings" in Part II, Item 1 of Morgan Stanley's Quarterly Report on Form 10-Q for the quarter ended 30 September 2014, which have all been incorporated by reference on pages 14 to 17 of this UK Prospectus.

Morgan Stanley's business, financial condition and results of operations could be adversely affected by governmental fiscal and monetary policies.

Morgan Stanley is affected by fiscal and monetary policies adopted by regulatory authorities and bodies of the U.S. and other governments. For example, the actions of the Federal Reserve and international central banking authorities directly impact its cost of funds for lending, capital raising and investment activities and may impact the value of financial instruments Morgan Stanley hold. In addition, such changes in monetary policy may affect the credit quality of its customers. Changes in domestic and international monetary policy are beyond its control and difficult to predict.

Morgan Stanley's commodities activities subject Morgan Stanley to extensive regulation, potential catastrophic events and environmental risks and regulation that may expose Morgan Stanley to significant costs and liabilities.

In connection with the commodities activities in Morgan Stanley's Institutional Securities business segment, Morgan Stanley engages in the production, storage, transportation, marketing and trading of several commodities, including metals (base and precious), crude oil, oil products, natural gas, electric power, emission credits, coal, freight, liquefied natural gas and related products and indices. In addition, Morgan Stanley is an electricity power marketer in the U.S. and own electricity generating facilities in the U.S.; and it owns a minority interest in Heidmar Holdings LLC, which owns a group of companies that provide international marine transportation and U.S. marine logistics services. As a result of these activities, Morgan Stanley is subject to extensive and evolving energy, commodities, environmental, health and safety and other governmental laws and regulations. In addition, liability may be incurred without regard to fault under certain environmental laws and regulations for the remediation of contaminated areas. Further, through these activities Morgan Stanley is exposed to regulatory, physical and certain indirect risks associated with climate change. Morgan Stanley's commodities business also exposes Morgan Stanley to the risk of unforeseen and catastrophic events, including natural disasters, leaks, spills, explosions, release of toxic substances, fires, accidents on land and at sea, wars, and terrorist attacks that could result in personal injuries, loss of life, property damage, and suspension of operations. For more information about the planned sale of Morgan Stanley's global oil merchanting business, see "Management’s Discussion and Analysis of Financial Condition and Results of Operations—Business Segments—Institutional Securities—Sale of Global Oil Merchanting Business" in Item 2 of Morgan Stanley's Quarterly Report on Form 10-Q for the quarterly period ended 30 June 2014, which has been incorporated by reference on page 16 of this UK Prospectus.

Although Morgan Stanley has attempted to mitigate its pollution and other environmental risks by, among other measures, adopting appropriate policies and procedures for power plant operations, monitoring the quality of petroleum storage facilities and transport vessels and implementing emergency response programs, these actions may not prove adequate to address every contingency. In addition, insurance covering some of these risks may not be available, and the proceeds, if any, from insurance recovery may not be adequate to cover liabilities with respect to particular incidents. As a result, its financial condition, results of operations and cash flows may be adversely affected by these events.

Morgan Stanley continue to engage in discussions with the Federal Reserve regarding its commodities activities, as the BHC Act provides a grandfather exemption for "activities related to the trading, sale or investment in commodities and underlying physical properties," provided that Morgan Stanley were engaged in "any of such activities as of September 30, 1997 in the United States" and provided that certain other conditions that are within its reasonable control are satisfied. If the Federal Reserve were to determine that any of its commodities activities did not qualify for the BHC Act grandfather exemption, then Morgan Stanley would likely be required to divest any such activities that did not otherwise conform to the BHC Act. See also "Scope of Permitted Activities" under "Business—Supervision and Regulation" in Part I, Item 1 of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, which has been incorporated by reference on page 14 of this UK Prospectus.

Morgan Stanley also expects the other laws and regulations affecting its commodities business to increase in both scope and complexity. During the past several years, intensified scrutiny of certain energy markets by federal, state and local authorities in the U.S. and abroad and the public has resulted in increased regulatory and legal enforcement, litigation and remedial proceedings involving companies engaged in the activities in which Morgan Stanley is engaged. For example, the U.S. and the E.U. have increased their focus on the energy markets which has resulted in increased regulation of companies participating in the energy markets, including those engaged in power generation and liquid hydrocarbons trading. In addition, new regulation of OTC derivatives markets in the U.S. and similar legislation proposed or adopted abroad will impose significant new costs and impose new requirements on Morgan Stanley's commodities derivatives activities. Morgan Stanley may incur substantial costs or loss of revenue in complying with current or future laws and regulations and its overall businesses and reputation may be adversely affected by the current legal environment. In addition, failure to comply with these laws and regulations may result in substantial civil and criminal fines and penalties.

A failure to address conflicts of interest appropriately could adversely affect Morgan Stanley's businesses and reputation.

As a global financial services firm that provides products and services to a large and diversified group of clients, including corporations, governments, financial institutions and individuals, Morgan Stanley face potential conflicts of interest in the normal course of business. For example, potential conflicts can occur when there is a divergence of interests between Morgan Stanley and a client, among clients, or between an employee on the one hand and Morgan Stanley or a client on the other. Morgan Stanley has policies, procedures and controls that are designed to address potential conflicts of interest. However, identifying and mitigating potential conflicts of interest can be complex and challenging, and can become the focus of media and regulatory scrutiny. Indeed, actions that merely appear to create a conflict can put Morgan Stanley's reputation at risk even if the likelihood of an actual conflict has been mitigated. It is possible that potential conflicts could give rise to litigation or enforcement actions, which may lead to its clients being less willing to enter into transactions in which a conflict may occur and could adversely affect its businesses and reputation.

Morgan Stanley's regulators have the ability to scrutinize its activities for potential conflicts of interest, including through detailed examinations of specific transactions. In addition, its status as a bank holding company supervised by the Federal Reserve subjects Morgan Stanley to direct Federal Reserve scrutiny with respect to transactions between its U.S. bank subsidiaries and their affiliates.

Risk Management

Morgan Stanley's risk management strategies may not be fully effective in mitigating its risk exposures in all market environments or against all types of risk.

Morgan Stanley has devoted significant resources to develop its risk management policies and procedures and expect to continue to do so in the future. Nonetheless, its risk management strategies, including its

hedging strategies, may not be fully effective in mitigating its risk exposure in all market environments or against all types of risk, including risks that are unidentified or unanticipated. As its businesses change and grow, and the markets in which Morgan Stanley operate evolve, its risk management strategies may not always adapt with those changes. Some of Morgan Stanley's methods of managing risk are based upon its use of observed historical market behavior and management's judgment. As a result, these methods may not predict future risk exposures, which could be significantly greater than the historical measures indicate. For example, market conditions during the financial crisis involved unprecedented dislocations and highlight the limitations inherent in using historical information to manage risk. Management of market, credit, liquidity, operational, legal, regulatory and compliance risks requires, among other things, policies and procedures to record properly and verify a large number of transactions and events, and these policies and procedures may not be fully effective. Morgan Stanley's trading risk management strategies and techniques also seek to balance its ability to profit from trading positions with its exposure to potential losses. While Morgan Stanley employ a broad and diversified set of risk monitoring and risk mitigation techniques, those techniques and the judgments that accompany their application cannot anticipate every economic and financial outcome or the timing of such outcomes. For example, to the extent that Morgan Stanley's trading or investing activities involve less liquid trading markets or are otherwise subject to restrictions on sale or hedging, Morgan Stanley may not be able to reduce its positions and therefore reduce its risk associated with such positions. Morgan Stanley may, therefore, incur losses in the course of its trading or investing activities. For more information on how Morgan Stanley monitors and manages market and certain other risks, see "Quantitative and Qualitative Disclosures about Market Risk—Risk Management—Market Risk" in Part II, Item 7A of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, "Quantitative and Qualitative Disclosures about Market Risk" in Part I, Item 3 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 31 March 2014, "Quantitative and Qualitative Disclosures about Market Risk" in Part I, Item 3 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 30 June 2014 and "Quantitative and Qualitative Disclosures about Market Risk" in Part I, Item 3 of Morgan Stanley’s Quarterly Report on Form 10-Q for the quarter ended 30 September 2014, which have been incorporated by reference on pages 14 to 17 of this UK Prospectus.

Competitive Environment

Morgan Stanley face strong competition from other financial services firms, which could lead to pricing pressures that could materially adversely affect Morgan Stanley's revenue and profitability.

The financial services industry and all aspects of Morgan Stanley's businesses are intensely competitive, and Morgan Stanley expects them to remain so. Morgan Stanley competes with commercial banks, brokerage firms, insurance companies, electronic trading and clearing platforms, financial data repositories, sponsors of mutual funds, hedge funds, energy companies and other companies offering financial or ancillary services in the U.S., globally and through the internet. Morgan Stanley competes on the basis of several factors, including transaction execution, capital or access to capital, products and services, innovation, reputation, risk appetite and price. Over time, certain sectors of the financial services industry have become more concentrated, as institutions involved in a broad range of financial services have left businesses, been acquired by or merged into other firms or have declared bankruptcy. Such changes could result in its remaining competitors gaining greater capital and other resources, such as the ability to offer a broader range of products and services and geographic diversity, or new competitors may emerge. Morgan Stanley has experienced and may continue to experience pricing pressures as a result of these factors and as some of its competitors seek to obtain market share by reducing prices. In addition, certain of Morgan Stanley's competitors may be subject to different, and in some cases, less stringent, legal and regulatory regimes, than Morgan Stanley is, thereby putting it at a competitive disadvantage. For more information regarding the competitive environment in which Morgan Stanley operates, see "Business—Competition" and "Business—Supervision and Regulation" in Part I, Item 1 of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, which has been incorporated by reference on page 14 of this UK Prospectus.

Automated trading markets may adversely affect Morgan Stanley's business and may increase competition.

Morgan Stanley has experienced intense price competition in some of its businesses in recent years. In particular, the ability to execute securities trades electronically on exchanges and through other automated trading markets has increased the pressure on trading commissions or comparable fees. The trend toward direct access to automated, electronic markets will likely continue and will likely increase as additional

markets move to more automated trading platforms. Morgan Stanley has experienced and it is likely that Morgan Stanley will continue to experience competitive pressures in these and other areas in the future as some of its competitors may seek to obtain market share by reducing prices (in the form of commissions or pricing).

Morgan Stanley's ability to retain and attract qualified employees is critical to the success of its business and the failure to do so may materially adversely affect its performance.

Morgan Stanley's people are its most important resource and competition for qualified employees is intense. In order to attract and retain qualified employees, Morgan Stanley must compensate such employees at market levels. Typically, those levels have caused employee compensation to be its greatest expense as compensation is highly variable and changes based on business and individual performance and market conditions. If Morgan Stanley is unable to continue to attract and retain highly qualified employees, or do so at rates or in forms necessary to maintain its competitive position, or if compensation costs required to attract and retain employees become more expensive, its performance, including its competitive position, could be materially adversely affected. The financial industry has and may continue to experience more stringent regulation of employee compensation, including limitations relating to incentive-based compensation, clawback requirements and special taxation, which could have an adverse effect on its ability to hire or retain the most qualified employees.

International Risk

Morgan Stanley is subject to numerous political, economic, legal, operational, franchise and other risks as a result of Morgan Stanley's international operations which could adversely impact Morgan Stanley's businesses in many ways.

Morgan Stanley is subject to political, economic, legal, tax, operational, franchise and other risks that are inherent in operating in many countries, including risks of possible nationalization, expropriation, price controls, capital controls, exchange controls, increased taxes and levies and other restrictive governmental actions, as well as the outbreak of hostilities or political and governmental instability. In many countries, the laws and regulations applicable to the securities and financial services industries are uncertain and evolving, and it may be difficult for Morgan Stanley to determine the exact requirements of local laws in every market. Morgan Stanley's inability to remain in compliance with local laws in a particular market could have a significant and negative effect not only on its business in that market but also on its reputation generally. Morgan Stanley is also subject to the enhanced risk that transactions it structures might not be legally enforceable in all cases.

Various emerging market countries have experienced severe political, economic and financial disruptions, including significant devaluations of their currencies, defaults or potential defaults on sovereign debt, capital and currency exchange controls, high rates of inflation and low or negative growth rates in their economies. Crime and corruption, as well as issues of security and personal safety, also exist in certain of these countries. These conditions could adversely impact its businesses and increase volatility in financial markets generally.

The emergence of a disease pandemic or other widespread health emergency, or concerns over the possibility of such an emergency as well as natural disasters, terrorist activities or military actions, could create economic and financial disruptions in emerging markets and other areas throughout the world, and could lead to operational difficulties (including travel limitations) that could impair its ability to manage its businesses around the world.

As a U.S. company, Morgan Stanley is required to comply with the economic sanctions and embargo programs administered by OFAC and similar multi-national bodies and governmental agencies worldwide, as well as applicable anticorruption laws in the jurisdictions in which it operates. A violation of a sanction, embargo program, or anticorruption law, could subject Morgan Stanley, and individual employees, to a regulatory enforcement action as well as significant civil and criminal penalties.

Acquisition and Joint Venture Risk

Morgan Stanley may be unable to fully capture the expected value from acquisitions, divestitures, joint ventures, minority stakes and strategic alliances.

In connection with past or future acquisitions, divestitures, joint ventures or strategic alliances (including with Mitsubishi UFJ Financial Group, Inc. (" MUFG ")), Morgan Stanley faces numerous risks and uncertainties combining, transferring, separating or integrating the relevant businesses and systems, including the need to combine or separate accounting and data processing systems and management controls and to integrate relationships with clients, trading counterparties and business partners. In the case of joint ventures and minority stakes, Morgan Stanley is subject to additional risks and uncertainties because it may be dependent upon, and subject to liability, losses or reputational damage relating to, systems, controls and personnel that are not under its control.

For example, the ownership arrangements relating to Morgan Stanley’s joint venture in Japan with MUFG of their respective investment banking and securities businesses are complex. MUFG and Morgan Stanley have integrated their respective Japanese securities businesses by forming two joint venture companies, MUMSS and MSMS. See "Management’s Discussion and Analysis of Financial Condition and Results of Operations—Other Matters—Japanese Securities Joint Venture" in Part II, Item 7 of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, which has been incorporated by reference on page 14 of this UK Prospectus.

In addition, conflicts or disagreements between Morgan Stanley and any of its joint venture partners may negatively impact the benefits to be achieved by the relevant joint venture.

There is no assurance that any of its acquisitions will be successfully integrated or yield all of the positive benefits anticipated. If Morgan Stanley is not able to integrate successfully its past and future acquisitions, there is a risk that its results of operations, financial condition and cash flows may be materially and adversely affected.

Certain of Morgan Stanley's business initiatives, including expansions of existing businesses, may bring it into contact, directly or indirectly, with individuals and entities that are not within its traditional client and counterparty base and may expose it to new asset classes and new markets. These business activities expose Morgan Stanley to new and enhanced risks, greater regulatory scrutiny of these activities, increased credit-related, sovereign and operational risks, and reputational concerns regarding the manner in which these assets are being operated or held.

For more information regarding the regulatory environment in which Morgan Stanley operates, see also "Business—Supervision and Regulation" in Part I, Item 1 of Morgan Stanley's Annual Report on Form 10-K for the year ended 31 December 2013, which has been incorporated by reference on page 14 of this UK Prospectus.

RISK FACTORS RELATING TO THE NOTES

Foreign-Currency Risks

Prospective investors should consult their financial and legal advisers as to any specific risks entailed by an investment in Notes that are denominated or payable in a currency other than the currency of the country in which they are resident or in which they conduct their business, referred to as their "home currency." Such Notes are not appropriate investments for investors who are not sophisticated in foreign currency transactions.

Exchange rates and exchange controls may affect Notes' value or return

General Exchange Rate and Exchange Control Risks. An investment in a Note denominated or payable in currencies other than the investor's home currency entails significant risks. The risks include the possibility of significant changes in rates of exchange between its home currency and the other relevant currencies and the possibility of the imposition or modification of exchange controls by the relevant governmental entities. These risks generally depend on economic and political events over which Morgan Stanley has no control.

Exchange Rates Will Affect the Investor's Investment . In recent years, rates of exchange between some currencies have been highly volatile and this volatility may continue in the future. Fluctuations in any particular exchange rate that have occurred in the past are not necessarily indicative, however, of fluctuations that may occur during the term of any Note. Depreciation against the investor's home currency or the currency in which a Note is payable would result in a decrease in the effective yield of the

Note below its coupon rate and could result in an overall loss to an investor on the basis of the investor's home currency.

Morgan Stanley Has No Control Over Exchange Rates. Currency exchange rates can either float or be fixed. Exchange rates of most economically developed nations are permitted to fluctuate in value relative to each other. However, from time to time governments may use a variety of techniques, such as intervention by a country's central bank, the imposition of regulatory controls or taxes, or changes in interest rates to influence the exchange rates of their currencies. Governments may also issue a new currency to replace an existing currency or alter the exchange rate or relative exchange characteristics by a devaluation or revaluation of a currency. These governmental actions could change or interfere with currency valuations and currency fluctuations that would otherwise occur in response to economic forces, as well as in response to the movement of currencies across borders.

As a consequence, these government actions could adversely affect yields or payouts in the investor's home currency for Notes denominated or payable in currencies other than the investor's home currency.

Morgan Stanley will not make any adjustment or change in the terms of the Notes in the event that exchange rates should become fixed, or in the event of any devaluation or revaluation or imposition of exchange or other regulatory controls or taxes, or in the event of other developments affecting any currency. The investor will bear those risks.

Some Currencies May Become Unavailable. Governments have imposed from time to time, and may in the future impose, exchange controls that could also affect the availability of a currency. Even if there are no actual exchange controls, it is possible that the applicable currency for any security would not be available when payments on that security are due.

Alternative Payment Method Used If Payment Currency Becomes Unavailable. If a payment currency is unavailable in respect of Notes, Morgan Stanley would make required payments in U.S. dollars on the basis of the market exchange rate, which might be an extremely unfavourable rate at the time of any such unavailability.

Currency Conversions May Affect Payments

Payments on the Notes may be made in U.S. dollars if the Euro is unavailable. In such a case, Morgan Stanley & Co. International plc, in its capacity as exchange rate agent, or a different exchange rate agent, will convert the currencies. The investor will bear the costs of conversion through deductions from those payments. Morgan Stanley & Co. International plc is Morgan Stanley's affiliate.

Secondary trading of the Notes may be limited

There may be little or no secondary market for the Notes. Even if there is a secondary market, it may not provide enough liquidity to allow the investor to sell or trade the Notes easily. Affiliates of Morgan Stanley may from time to time make a market in the Notes, but they are not required to do so. If at any time such affiliates of Morgan Stanley were to cease making a market in the Notes, it is likely that there would be little or no secondary market for the Notes.

Exchange Rates May Affect the Value of a New York Judgment Involving Non-U.S. Dollar Securities

The securities will be governed by and construed in accordance with the laws of the State of New York. If a New York court were to enter a judgment in an action on any securities denominated in a foreign currency, such court would enter a judgment in the foreign currency and convert the judgment or decree into U.S. dollars at the prevailing rate of exchange on the date such judgment or decree is entered.

The Notes are not insured bank deposits

The Notes are not bank deposits and are not insured by the FDIC or any other governmental agency, nor are they obligations of, or guaranteed by, a bank.

INCORPORATION BY REFERENCE

The following documents (or parts thereof) shall be deemed to be incorporated into and form part of this UK Prospectus:

(A) the following sections of the registration document dated 13 June 2014:
Description of Morgan Stanley on pages 20 to 63; and
Subsidiaries of Morgan Stanley on pages 75 to 87.

The registration document is available in electronic form at:

https://www.bourse.lu/Bourse/application?_flowId=DownloadDocumentFlow&v=z/++Edz7f+o41gGTsQ +Xl75uf8TndBqUKDC8HPrCQsKrj3XO+FmDvjJoXnRuUqfbMZhl8A/69avl/qh/590Y2tpsBfOppy+DJI ncHhGTqcAJjyMYAsILkPIVlsiqDZOhgcyP9IGJcU2ktrlozydctP5SixzN3Xf4ekYkfKQL/tc=&so_timeou t=0.

(B) Morgan Stanley's Annual Report on Form 10-K for year ended 31 December 2013 (as set out at http://www.sec.gov):
The sub-sections headed "Competition" on pages 6 to 7 and "Supervision and Regulation" on pages 7 to 20 under the section headed "Business";
Legal Proceedings on pages 35 to 46 for year ended 31 December 2013;
Selected Financial Data on pages 50 and 51;
The third paragraph of the sub-sections headed "Introduction" on page 52, "Global Market and Economic Conditions" on page 59, "Sale of Global Oil Merchandising Business" on page 72, "Japanese Securities Joint Venture" on pages 85 to 86; "Regulatory Outlook" on page 87 and "Liquidity and Capital Resources" on pages 92 to 110 under the section headed "Management's Discussion and Analysis of Financial Condition and Results of Operations";
Quantitative and Qualitative Disclosures about Market Risk on pages 111 to 135;
Report of Independent Registered Public Accounting Firm on page 136 for years ended 31 December 2013 and 31 December 2012;
Consolidated Statements of Financial Condition on page 137 for the years ended 31 December 2013 and 31 December 2012;
Consolidated Statements of Income on page 138 for the years ended 31 December 2013 and 31 December 2012 (the column headed 2011 is specifically omitted from incorporation by reference);
Consolidated Statements of Cash Flows on page 140 for the years ended 31 December 2013 and 31 December 2012 (the columns headed 2011, 2010 and 2009 are specifically omitted from incorporation by reference);
Notes to Consolidated Financial Statements on pages 142 to 284 for year ended 31 December 2013; and
14-
Exhibit 12 - Ratio of Earnings to Fixed Charges and Ratio of Earnings to Fixed Charges and Preferred Stock Dividends (unaudited) for the years ended 31 December 2013 and 31 December 2012 (the columns headed 2011, 2010 and 2009 are specifically omitted from incorporation by reference).
(C) Morgan Stanley's Current Report on Form 8-K dated 17 January 2014 relating to the release of its unaudited financial information with respect to the quarter and year ended 31 December 2013 and an investor conference call held on 17 January 2014 (as set out at http://www.sec.gov).
(D) Morgan Stanley's Current Report on Form 8-K dated 4 February 2014 relating to an agreement in principle to resolve Morgan Stanley's mortgage-backed securities litigation pending in the United States District Court for the Southern District of New York with the Federal Housing Finance Agency as conservator for Freddie Mac and Fannie Mae (as set out at http://www.sec.gov).
(E) Morgan Stanley's Current Report on Form 8-K dated 26 March 2014 relating to the response from the Board of Governors of the Federal Reserve System to Morgan Stanley's 2014 capital plan and Morgan Stanley's plan for future share repurchases (as set out at http://www.sec.gov).
(F) Morgan Stanley's 2014 Proxy Statement dated 28 March 2014 relating to the 2014 Annual Meeting of Shareholders of Morgan Stanley (as set out at http://www.sec.gov).
(G) Morgan Stanley's Current Report on Form 8-K dated 17 April 2014 relating to the release of its unaudited financial information with respect to the quarter ended 31 March 2014 and the compensatory arrangements of certain Morgan Stanley's employees (as set out at http://www.sec.gov).
(H) Morgan Stanley's Current Report on Form 8-K dated 29 April 2014 relating to the modification to rights of certain security holders upon the issuance of the Series G Preferred Stock and the Series H Preferred Stock and the associated amendments to Morgan Stanley's Articles of Incorporation or Bylaws (as set out at http://www.sec.gov).
(I) Morgan Stanley's Quarterly Report on Form 10-Q for the quarterly period ended 31 March 2014 (as set out at http://www.sec.gov):
The third paragraph of the sub-sections headed "Introduction" on page 95, "Global Market and Economic Conditions" on page 100, "Regulatory Outlook" on page 121 and "Liquidity and Capital Resources” on pages 127 to 144 under the section headed "Management's Discussion and Analysis of Financial Condition and Results of Operations";
Financial Information on pages 1 to 94;
Contingencies on pages 76 to 80 and Legal Proceedings on pages 166 to 167;
Quantitative and Qualitative Disclosures about Market Risk on pages 145 to 161; and
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Exhibit 12 – Ratio of Earnings to Fixed Charges and Ratio of Earnings to Fixed Charges and Preferred Stock Dividends (unaudited).
(J) Morgan Stanley's Current Report on Form 8-K dated 13 May 2014 relating to the approval by Morgan Stanley's shareholders to elect directors to Morgan Stanley's Board of Directors, to ratify the appointment of Deloitte & Touche LLP as independent auditor, to approve the compensation of executives and to prepare a report on lobbying (as set out at http://www.sec.gov).
(K) Morgan Stanley's Quarterly Report on Form 10-Q for the quarterly period ended 30 June 2014 (as set out at http://www.sec.gov):
The third paragraph of the sub-sections headed "Introduction" on page 97, "Global Market and Economic Conditions" on page 102, "Regulatory Outlook" on pages 124125 and "Liquidity and Capital Resources” on pages 130 to 149 under the section headed "Management's Discussion and Analysis of Financial Condition and Results of Operations";
Financial Information on pages 1 to 96;
Contingencies on pages 75 to 80 and Legal Proceedings on pages 174 to 176;
Quantitative and Qualitative Disclosures about Market Risk on pages 150 to 166; and
Exhibit 12 – Ratio of Earnings to Fixed Charges and Ratio of Earnings to Fixed Charges and Preferred Stock Dividends (unaudited).
(L) Morgan Stanley's Current Report on Form 8-K dated 17 July 2014 relating to Results of Operations and Financial Condition Financial Statements and Exhibits (as set out at http://www.sec.gov).
(M) Morgan Stanley's Current Report on Form 8-K dated 18 September 2014 relating to Material Modifications to Rights of Security Holders, Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year and Financial Statements and Exhibits (as set out at http://www.sec.gov).
(N) Morgan Stanley's Quarterly Report on Form 10-Q for the quarterly period ended 30 September 2014 (as set out at http://www.sec.gov):
The third paragraph of the sub-sections headed "Introduction" on page 97, "Global Market and Economic Conditions" on page 104, "Regulatory Outlook" on pages 130131 and "Liquidity and Capital Resources” on pages 136 to 157 under the section headed "Management's Discussion and Analysis of Financial Condition and Results of Operations";
Financial Information on pages 1 to 98;
Contingencies on pages 76 to 81 and Legal Proceedings on pages 182 to 185;
Quantitative and Qualitative Disclosures about Market Risk on pages 158 to 174; and
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Exhibit 12 – Ratio of Earnings to Fixed Charges and Ratio of Earnings to Fixed Charges and Preferred Stock Dividends (unaudited).
(O) Morgan Stanley's Current Report on Form 8-K dated 17 October 2014 relating to Results of Operations and Financial Condition Financial Statements and Exhibits (as set out at http://www.sec.gov).
(P) Morgan Stanley's Current Report on Form 8-K dated 31 October 2014 relating to Change in Directors or Principal Officers, Financial Statements and Exhibits (as set out at http://www.sec.gov).
(For ease of reference, the documents listed in (B) to (P) above are available at http://www.sec.gov/cgi bin/browse-edgar?company=&CIK=0000895421&State=&SIC=&action=getcompany and in electronic form on Morgan Stanley's website at http://www.morganstanley.com/about/ir/sec_filings.html.) Any statement contained in this UK Prospectus, or any other documents incorporated by reference herein, shall be deemed to be modified or superseded to the extent that a statement contained in any later document subsequently incorporated by reference modifies or supersedes such statement.

Any information contained in any of the documents specified above which is not incorporated by reference in this UK Prospectus is either not relevant to investors or is covered elsewhere in this UK Prospectus.

The documents incorporated by reference in this UK Prospectus shall not include any documents which are themselves incorporated by reference in such incorporated documents ("daisy chained" documents). Such daisy chained documents shall not form part of this UK Prospectus. Where only part of the documents listed above have been incorporated by reference, only information expressly incorporated by reference herein shall form part of this UK Prospectus and the non-incorporated parts are either not relevant for the investor or covered elsewhere in this UK prospectus.

Morgan Stanley will, at its principal executive offices and during the period of twelve months after the date of publication of this UK Prospectus, make available for inspection during normal business hours and free of charge, upon oral or written request:

(i) a copy of this UK Prospectus and any document containing the sections relating to Morgan Stanley incorporated by reference in this UK Prospectus;
(ii) its certificate of incorporation;
(iii) all reports, letters, and other documents, historical financial information, valuations and statements (if any) prepared by any expert at the request of Morgan Stanley which is included or referred to in this UK Prospectus; and
(iv) the historical financial information of Morgan Stanley (or Morgan Stanley and its subsidiaries) for each of the two financial years preceding the publication of this UK Prospectus.
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DESCRIPTION OF MORGAN STANLEY

Information in relation to Morgan Stanley can be found on pages 20 to 64 of the registration document dated 13 June 2014 in the section headed "Description of Morgan Stanley", incorporated by reference on page 14 of this UK Prospectus.

DESCRIPTION OF THE NOTES

General

The Notes comprise €1,250,000,000 aggregate principal amount of Global Medium-Term Notes, Series G Euro Floating Rate Senior Registered Notes Due 2019, which are debt securities of Morgan Stanley issued under a senior debt indenture dated as of 1 November 2004 between Morgan Stanley and The Bank of New York Mellon, a New York banking corporation (as successor to JPMorgan Chase Bank, N.A.) as trustee (as supplemented from time to time, the " Senior Debt Indenture "). The Notes priced on 12 November 2014 and the settlement date was 19 November 2014 (the original issue date) (the " Issue Date ").

Notes issued under the Senior Debt Indenture that are part of Morgan Stanley's Series G medium-term note program (including the Notes), Morgan Stanley's Series H medium-term note program and Morgan Stanley's Series F medium-term note program will constitute a single series under the Senior Debt Indenture, together with any medium-term notes Morgan Stanley issues in the future under the Senior Debt Indenture that Morgan Stanley designates as being part of that series. Morgan Stanley may create and issue additional notes with the same terms as the Notes so that the additional notes will be considered part of the same issuance as the Notes.

The issue price of the Notes was 99.851%. The Notes are denominated in euro, meaning that the "specified currency" applicable to the Notes is euro.

The material provisions of the Notes are summarised below.

Definitions . For the purpose of this UK Prospectus:

" Base Rate " means EURIBOR.

A " business day " means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions are authorized or required by law or regulation to close in The City of New York or in London, and that is also a TARGET Settlement Day.

" Calculation Agent " means The Bank of New York Mellon, London Branch (as successor Calculation Agent to JPMorgan Chase Bank, N.A. (formerly known as JPMorgan Chase Bank)).

" Clearstream, Luxembourg " means Clearstream Banking, société anonyme , Luxembourg.

“ EURIBOR ” means, for any Interest Determination Date, the rate for deposits in euros as sponsored, calculated and published jointly by the European Banking Federation and ACI - The Financial Market Association, or any company established by the joint sponsors for purposes of compiling and publishing those rates, for three months as that rate appears on the display on Reuters 3000 Xtra Service (“ Reuters ”), or any successor service, on page EURIBOR01 or any other page as may replace page EURIBOR01 on that service, which is commonly referred to as “Reuters Page EURIBOR01” as of 11:00 a.m., Brussels time.

The following procedures will be followed if the rate cannot be determined as described above:

If the above rate does not appear, the Calculation Agent will request the principal Euro-zone office of each of four major banks in the Euro-zone interbank market, as selected by the Calculation Agent, after consultation with Morgan Stanley, to provide the Calculation Agent with its offered rate for deposits in euros, at approximately 11:00 a.m., Brussels time, on the Interest Determination Date, to prime banks in the Euro-zone interbank market for three months commencing on the applicable Interest Reset Date, and in a principal amount not less than the equivalent of U.S.$1 million in euro that is representative of a single transaction in euro, in that market at that time. If at least two quotations are provided, EURIBOR will be the arithmetic mean of those quotations.

If fewer than two quotations are provided, EURIBOR will be the arithmetic mean of the rates quoted by four major banks in the Euro-zone interbank market, as selected by the Calculation Agent, after consultation with us, at approximately 11:00 a.m., Brussels time, on the applicable Interest Reset Date for loans in euro to leading European banks for a period of three months

commencing on that Interest Reset Date in a principal amount not less than the equivalent of U.S.$1 million in euro.

If the banks so selected by the Calculation Agent are not quoting as set forth above, EURIBOR for that Interest Determination Date will remain EURIBOR for the immediately preceding Interest Reset Period, or, if there was no Interest Reset Period, the rate of interest payable will be the Initial Interest Rate.

" Euroclear " means Euroclear Bank S.A./N.V.

" Euro-zone " means the region comprising Member States of the European Union that have adopted the single currency in accordance with the relevant treaty of the European Union, as amended.

" Index Maturity " means three months.

" Initial Interest Rate " means the interest rate in effect from the Issue Date to the first Interest Reset Date, which will be the Base Rate plus the Spread, with the Base Rate to be determined by the Calculation Agent on the second TARGET Settlement Date immediately preceding 19 November 2014.

" Interest Payment Date " means each of 19 February 2015, 19 May 2015, 19 August 2015, 19 November 2015, 19 February 2016, 19 May 2016, 19 August 2016, 19 November 2016, 19 February 2017, 19 May 2017, 19 August 2017, 19 November 2017, 19 February 2018, 19 May 2018, 19 August 2018, 19 November 2018, 19 February 2019, 19 May 2019, 19 August 2019 and 19 November 2019, subject to adjustment as described below.

" Interest Reset Date " means Interest Payment Date.

" Maturity Date " means 19 November 2019.

The " NSS " means the new safekeeping structure for the Notes.

For any definitive registered note, the " record date " for any Interest Payment Date is the date 15 calendar days prior to that Interest Payment Date, whether or not that date is a business day. For any global registered note, the " record date " for any Interest Payment Date is the date one clearing system business day before such Interest Payment Date, where " clearing system business day " means a day on which each clearing system for which such global registered note is being held is open for business.

" Spread " means plus 0.70%.

" TARGET Settlement Day " means any day on which the Trans-European Automated Real-time Gross Settlement Express Transfer payment system, which utilizes a single platform and which was launched on November 19, 2007 is open for the settlement of payment in euro.

References in this UK prospectus to " U.S. dollars " and " U.S.$ " and " $ " are to the currency of the United States of America.

References in this UK prospectus to " euro " and " € " are to the single currency introduced at the commencement of the third stage of the European Economic and Monetary Union pursuant to the Treaty establishing the European Community, as amended.

Form

The Notes will be: in global registered form; represented by a global note registered in the name of a nominee of a common safekeeper for Euroclear and Clearstream, Luxembourg; and issued under the NSS. Unless and until it is exchanged in whole for securities in definitive registered form, the registered global note may not be transferred except as a whole by and among the depositary for the registered global note, the nominees of the depositary or any successors of the depositary or those nominees.

The Notes are intended to be Eurosystem eligible, which means that the notes are intended upon issue to be deposited with an international central securities depository (" ICSD ") as common safekeeper, and registered in the name of a nominee of an ICSD acting as common safekeeper, and does not necessarily mean that the Notes will be recognized as eligible collateral for Eurosystem monetary policy and intra-

day credit operations by the Eurosystem either upon issue or at any or all times during their life. Such recognition will depend upon the European Central Bank being satisfied that Eurosystem eligibility criteria have been met.

Denomination of the Notes

The minimum denomination of the Notes is of €100,000 and integral multiples of €1,000 in excess thereof.

Security Identification Number

The security identification numbers of the Notes are as follows:

ISIN: XS1139320151 Common Code: 113932015

Ranking of the Notes

The Notes constitute part of the senior debt of Morgan Stanley and rank on a parity with all of the other unsecured and unsubordinated debt of Morgan Stanley, subject to statutory exceptions in the event of liquidation upon insolvency.

Exchange and Transfer

Morgan Stanley has initially designated The Bank of New York Mellon, London Branch (as successor to JPMorgan Chase Bank, N.A., London Branch), as a transfer and paying agent for the Notes and as Morgan Stanley's principal paying agent for the Notes outside the United States. As long as any of the Notes are admitted to listing on the Official List of the UK Listing Authority and to trading on the London Stock Exchange plc and the UK Listing Authority requires it, Morgan Stanley will maintain a transfer agent and a paying agent in London. Morgan Stanley will, to the extent possible as a matter of law, maintain a paying agent in a member state of the European Union that will not be obligated to withhold or deduct tax pursuant to any such Directive or any law implementing or complying with, or introduced in order to conform to, such Directive.

A holder may present the Notes for registration of transfer or exchange at the offices of the registrar or at the offices of any transfer agent that Morgan Stanley designates. Morgan Stanley has designated The Bank of New York Mellon (as successor to JPMorgan Chase Bank, N.A.), acting through its principal corporate trust office in the Borough of Manhattan, The City of New York, as its registrar and transfer agent for the Notes and as its paying agent for the Notes in the United States. All references to a registrar will include any successor registrar that Morgan Stanley appoints. Morgan Stanley can rescind its initial designation of the registrar or a transfer agent at any time. However, so long as any of the Notes remain outstanding, Morgan Stanley will maintain in the Borough of Manhattan, The City of New York, one or more offices or agencies where the Notes may be presented for registration of transfer and exchange.

Morgan Stanley will not be required to:

register the transfer of or exchange any Note to be redeemed for a period of fifteen calendar days preceding the first publication or other transmission, if applicable, of the relevant notice of redemption, or if any Notes are outstanding and there is no publication, the mailing of the relevant notice of redemption; or
register the transfer of or exchange any Note selected for redemption, in whole or in part, except the unredeemed or unpaid portion of that registered note being redeemed or repaid in part.

No service charge will be made for any registration of transfer or exchange of Notes, but Morgan Stanley may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the registration of transfer of Notes.

Interest

The Notes bear interest at a floating rate equivalent to the Base Rate plus the Spread. The interest rate is reset quarterly. This period is the " Interest Reset Period " and the first day of each Interest Reset Period

is the Interest Reset Date. The interest rate in effect from 19 November 2014 to the first Interest Reset Date will be the Initial Interest Rate.

The interest rate may not be higher than the maximum rate permitted by New York law, as that rate may be modified by United States law of general application. Under current New York law, the maximum rate of interest, subject to some exceptions, for any loan in an amount less than $250,000 is 16% and for any loan in the amount of $250,000 or more but less than $2,500,000 is 25% per annum on a simple interest basis. These limits do not apply to loans of $2,500,000 or more.

On the second TARGET Settlement Day prior to each Interest Reset Date (the " Interest Determination Date "), the Calculation Agent will determine the new interest rate at which the floating rate will reset. If an Interest Reset Date for the Notes falls on a day that is not a business day, it will be postponed to the following business day, except that, if that business day is in the next calendar month, the Interest Reset Date will be the immediately preceding business day.

The interest rate in effect for the ten calendar days immediately prior to maturity, redemption or repayment will be the one in effect on the tenth calendar day preceding the maturity, redemption or repayment date.

In the paragraphs which follow, the "calculation date" pertaining to an Interest Determination Date means the earlier of (i) the tenth calendar day after that Interest Determination Date, or, if that day is not a business day, the next succeeding business day, or (ii) the business day immediately preceding the applicable Interest Payment Date or maturity date or, for any principal amount to be redeemed or repaid, any redemption or repayment date.

Upon the request of the holder of any Note, the Calculation Agent will provide the interest rate then in effect and, if determined, the interest rate that will become effective on the next Interest Reset Date. The Calculation Agent will notify the Financial Conduct Authority (the "FSA") and/or the London Stock Exchange plc, where the rules of the FCA and/or the London Stock Exchange plc require it, and the paying agents of each determination of the interest rate applicable to the Notes promptly after the determination is made.

All percentages used in or resulting from any calculation of the rate of interest on the Notes will be rounded, if necessary, to the nearest one hundred-thousandth of a percentage point, with .000005% rounded up to .00001%, and all U.S. dollar amounts used in or resulting from these calculations on Notes will be rounded to the nearest cent, with one-half cent rounded upward. All amounts denominated in any other currency used in or resulting from these calculations will be rounded to the nearest two decimal places in that currency, with .005 rounded up to .01.

Interest on the Notes will accrue from and including the most recent Interest Payment Date to which interest has been paid or duly provided for, or, if no interest has been paid or duly provided for, from and including the Issue Date. Interest will accrue to but excluding the next Interest Payment Date or, if earlier, the date on which the principal has been paid or duly made available for payment.

Interest on the Notes will be calculated by multiplying the principal amount by an accrued interest factor. This accrued interest factor will be computed by adding the interest factors calculated for each day in the period for which interest is being paid. The interest factor for each day is computed by dividing the interest rate applicable to that day by 360. For these calculations, the interest rate in effect on any Interest Reset Date will be the applicable rate as reset on that date. The interest rate applicable to any other day is the interest rate from the immediately preceding Interest Reset Date or, if none, the Initial Interest Rate.

Morgan Stanley will pay interest on the Notes on the Interest Payment Dates. If any scheduled Interest Payment Date, other than the Maturity Date or any earlier redemption or repayment date, for the Notes falls on a day that is not a business day, it will be postponed to the next business day, except that, if that business day would fall in the next calendar month, the Interest Payment Date will be the immediately preceding business day. If the Maturity Date or any earlier redemption or repayment date falls on a day that is not a business day, the payment of principal and interest will be made on the next succeeding business day, but interest on that payment will not accrue during the period from and after the Maturity Date, redemption or repayment date.

Interest and Principal Payments

Payments of principal and interest on the Notes will be in euro. Unless alternative arrangements are made, Morgan Stanley will pay such principal and interest to an account at a bank outside the United States, which will be made by credit or transfer to a euro account specified by the payee in a country for which the euro is the lawful currency.

Recipients of Payments. The paying agent will pay interest to the person in whose name the debt security is registered at the close of business on the applicable record date. However, upon maturity or redemption, the paying agent will pay any interest due to the person to whom it pays the principal of the Notes. The paying agent will make the payment of interest on the Maturity Date or redemption date, whether or not that date is an Interest Payment Date. The paying agent will make the initial interest payment on the Notes on the first Interest Payment Date falling after the date of issuance.

Unavailability of Foreign Currency. Euro may not be available to Morgan Stanley for making payments of principal or interest on the Notes. This could occur due to the imposition of exchange controls or other circumstances beyond Morgan Stanley's control or if euro is no longer used by the government of the country issuing euro or by public institutions within the international banking community for the settlement of transactions. If the euro is unavailable, Morgan Stanley may satisfy its obligations to holders of the Notes by making those payments on the date of payment in U.S. dollars on the basis of the noon dollar buying rate in The City of New York for cable transfers of euro, published by the Federal Reserve Bank of New York, which is referred to herein as the "market exchange rate." If that rate of exchange is not then available or is not published for euro, the market exchange rate will be based on the highest bid quotation in The City of New York received by the exchange rate agent (initially Morgan Stanley & Co. International plc, an affiliate of Morgan Stanley) at approximately 11:00 a.m., New York City time, on the second business day preceding the applicable payment date from three recognized foreign exchange dealers for the purchase by the quoting dealer:

of euro for settlement on the payment date;
in the aggregate amount of euro payable to those holders or beneficial owners of the Notes; and
at which the applicable dealer commits to execute a contract.

One of the dealers providing quotations may be the exchange rate agent unless the exchange rate agent is an affiliate of Morgan Stanley. If those bid quotations are not available, the exchange rate agent will determine the market exchange rate at its sole discretion.

Unclaimed Principal or Interest . If money is paid by Morgan Stanley and held by the trustee or any paying agent for payment of the principal or interest on the Notes that remain unclaimed at the end of two years after that principal or interest has become due and payable at maturity or otherwise:

the trustee or the paying agent will notify the holders of the Notes that money will be repaid to Morgan Stanley and any person claiming that money will thereafter look only to Morgan Stanley for payment, and
that money will be repaid to Morgan Stanley.

Upon repayment, the trustee or the paying agent for that money will not be liable for the money. However, Morgan Stanley's obligation to pay the principal or interest on the Notes as they become due will not be limited in any way.

Redemption and Repurchase

Maturity Date: The Notes will be redeemed at 100% of their principal amount on the Maturity Date.

Optional Redemption by Morgan Stanley . The Notes cannot be redeemed prior to the Maturity Date, other than as provided under "Tax Redemption" below.

Open Market Purchases by Morgan Stanley. Morgan Stanley may purchase the Notes at any price in the open market or otherwise. Notes so purchased by Morgan Stanley may, at its discretion, be held or resold or surrendered to the trustee for cancellation.

Tax Redemption

The Notes may be redeemed as a whole at Morgan Stanley's option at any time prior to maturity, if Morgan Stanley determines that, as a result of:

any change in or amendment to the laws (including a holding, judgment or order by a court of competent jurisdiction), or any regulations or rulings promulgated thereunder, of the United States or of any political subdivision or taxing authority of or in the United States affecting taxation, or
any change in official position regarding the application or interpretation of the laws, regulations or rulings referred to above,

which change or amendment occurs, becomes effective or, in the case of a change in official position, is announced on or after 12 November 2014, Morgan Stanley has or will become obligated to pay additional amounts with respect to the Notes as described below under "—Payment of Additional Amounts." The redemption price will be equal to 100% of the principal amount of the Notes, together with accrued interest to the date fixed for redemption.

Prior to giving such notice of tax redemption, Morgan Stanley will deliver to the trustee:

a certificate stating that Morgan Stanley is entitled to effect the redemption and setting forth a statement of facts showing that the conditions precedent to Morgan Stanley's right to so redeem have occurred; and
an opinion of independent legal counsel satisfactory to the trustee to the effect that Morgan Stanley is entitled to effect the redemption based on the statement of facts set forth in the certificate.

Morgan Stanley will give notice of any tax redemption . Notice of tax redemption will be given not less than 30 nor more than 60 days prior to the date fixed for redemption. The date and the applicable redemption price will be specified in the notice, which will be given in accordance with "—Notices" below.

However, no notice of tax redemption will be given earlier than 60 days prior to the earliest date on which Morgan Stanley would be obligated to pay the additional amounts if a payment on the Notes were then due. The date on which the certificate is delivered to the trustee is referred to herein as the "redemption determination date."

Payment of Additional Amounts

Morgan Stanley will pay, subject to the exceptions and limitations set forth below, any additional amounts, which are referred to herein as the "additional amounts," to the beneficial owner of any of the Notes who is a U.S. Alien as may be necessary in order that every net payment of the principal of and interest on such Note and any other amounts payable on such Note, after withholding or deduction for or on account of any present or future tax, assessment or governmental charge imposed upon or as a result of that payment by the United States, or any political subdivision or taxing authority of or in the United States, will not be less than the amount provided for in the Note to be then due and payable.

Morgan Stanley will not, however, make any payment of additional amounts to any beneficial owner who is a U.S. Alien for or on account of:

any present or future tax, assessment or other governmental charge that would not have been so imposed but for
the existence of any present or former connection between the beneficial owner of such Note, or between a fiduciary, settlor, beneficiary, member or shareholder of the beneficial owner, if the beneficial owner is an estate, a trust, a partnership or a corporation for U.S. federal income tax purposes, and the United States, including, without limitation, the beneficial owner, or the fiduciary, settlor, beneficiary, member or shareholder, being or
24-

having been a citizen or resident of the United States or being or having been engaged in the conduct of a trade or business or present in the United States or having, or having had, a permanent establishment in the United States; or

the presentation by or on behalf of the beneficial owner of such Note for payment on a date more than 15 days after the date on which payment became due and payable or the date on which payment of such note or coupon is duly provided for, whichever occurs later;
any estate, inheritance, gift, sales, transfer, excise or personal property tax or any similar tax, assessment or governmental charge;
any tax, assessment or other governmental charge imposed by reason of the beneficial owner's past or present status as a controlled foreign corporation or passive foreign investment company with respect to the United States or as a corporation that accumulates earnings to avoid U.S. federal income tax or as a private foundation or other tax-exempt organization;
any tax, assessment or other governmental charge that is payable otherwise than by withholding or deduction from payments on or in respect of such note;
any tax, assessment or other governmental charge required to be withheld by any paying agent from any payment of principal of, or interest on, such note, if payment can be made without withholding by at least one other paying agent;
any tax, assessment or other governmental charge imposed solely because the holder or the beneficial owner (1) is a bank purchasing such note in the ordinary course of its lending business or (2) is a bank that is neither (A) buying such note for investment purposes nor (B) buying such note for resale to a third party that either is not a bank or holding such note for investment purposes only;
any tax, assessment or other governmental charge that would not have been imposed but for the failure to comply with certification, information or other reporting requirements concerning the nationality, residence, identity or connection with the United States of the beneficial owner of such note, if compliance is required by statute or by regulation of the United States or of any political subdivision or taxing authority of or in the United States as a precondition to relief or exemption from the tax, assessment or other governmental charge;
any withholding tax that would not have been imposed but for the failure to satisfy the conditions of avoiding withholding tax under Sections 1471 through 1474 of the Internal Revenue Code of 1986, as amended, and any applicable Treasury regulations promulgated thereunder or published administrative guidance implementing such sections;
any tax, assessment or other governmental charge imposed by reason of the beneficial owner's past or present status as the actual or constructive owner of 10% or more of the total combined voting power of all classes of Morgan Stanley's stock entitled to vote or as a direct or indirect subsidiary of Morgan Stanley; or
any combination of the items listed above.

In addition, Morgan Stanley will not be required to make any payment of additional amounts with respect to any Note presented for payment:

where such withholding or deduction is imposed on a payment to an individual and is required to be made pursuant to any law implementing or complying with, or introduced in order to conform to, any European Union Directive on the taxation of savings; or
by or on behalf of a beneficial owner who would have been able to avoid such withholding or deduction by presenting the relevant note or coupon to another paying agent in a member state of the European Union.
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Nor will Morgan Stanley pay additional amounts with respect to any payment on a note to a U.S. Alien who is a fiduciary or partnership or other than the sole beneficial owner of the payment to the extent the payment would be required by the laws of the United States (or any political subdivision of the United States) to be included in the income, for tax purposes, of a beneficiary of, or settlor with respect to the fiduciary or a member of the partnership or a beneficial owner who would not have been entitled to the additional amounts had the beneficiary, settlor, member or beneficial owner held its interest in the note directly.

As used in this UK prospectus, the term "U.S. Alien" means any person who is, for U.S. federal income tax purposes, (i) a nonresident alien individual, (ii) a foreign corporation, (iii) a nonresident alien fiduciary of a foreign estate or trust or (iv) a foreign partnership one or more of the members of which is, for U.S. federal income tax purposes, a nonresident alien individual, a foreign corporation or a nonresident alien fiduciary of a foreign estate or trust.

Covenants Restricting Pledges, Mergers and Other Significant Corporate Actions

Negative Pledge . Because Morgan Stanley is a holding company, its assets consist primarily of the securities of its subsidiaries. The negative pledge provisions of the Senior Debt Indenture limit Morgan Stanley's ability to pledge some of these securities. The Senior Debt Indenture provides that Morgan Stanley will not, and will not permit any subsidiary to, create, assume, incur or guarantee any indebtedness for borrowed money that is secured by a pledge, lien or other encumbrance except for liens specifically permitted by the Senior Debt Indenture on:

the voting securities of Morgan Stanley & Co. LLC, Morgan Stanley & Co. International plc or any subsidiary succeeding to any substantial part of the business now conducted by any of those corporations, which are collectively referred to herein as the "principal subsidiaries", or
the voting securities of a subsidiary that owns, directly or indirectly, the voting securities of any of the principal subsidiaries, other than directors' qualifying shares,

without making effective provisions so that the Notes will be secured equally and rateably with indebtedness so secured.

For these purposes, "subsidiary" means any corporation, partnership or other entity of which at the time of determination Morgan Stanley owns or controls directly or indirectly more than 50% of the shares of the voting stock or equivalent interest, and "voting securities" means stock of any class or classes having general voting power under ordinary circumstances to elect a majority of the board of directors, managers or trustees of the relevant subsidiary, other than stock that carries only the conditional right to vote upon the happening of an event, whether or not that event has happened. (Senior Debt Indenture, Section 3.06).

Merger, Consolidation, Sale, Lease or Conveyance . The Senior Debt Indenture provides that Morgan Stanley will not merge or consolidate with any other person and will not sell, lease or convey all or substantially all of its assets to any other person, unless:

Morgan Stanley will be the continuing corporation; or
the successor corporation or person that acquires all or substantially all of Morgan Stanley's assets:
will be a corporation organized under the laws of the United States, a state of the United States or the District of Columbia; and
will expressly assume all of Morgan Stanley's obligations under the Senior Debt Indenture and the debt securities issued under the Senior Debt Indenture; and
immediately after the merger, consolidation, sale, lease or conveyance, Morgan Stanley, that person or that successor corporation will not be in default in the performance of the covenants and conditions of the indenture applicable to us. (Senior Debt Indenture, Section 9.01).
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Absence of Protections against All Potential Actions of Morgan Stanley . There are no covenants or other provisions in the Senior Debt Indenture that would afford the holders additional protection in the event of a recapitalization transaction, a change of control of Morgan Stanley or a highly leveraged transaction. The merger covenant described above would only apply if the recapitalization transaction, change of control or highly leveraged transaction were structured to include a merger or consolidation of Morgan Stanley or a sale, lease or conveyance of all or substantially all of Morgan Stanley's assets.

Events of Default

The Senior Debt Indenture provides the holders of the Notes with remedies if Morgan Stanley fails to perform specific obligations or if Morgan Stanley becomes bankrupt. Holders should review these provisions and understand which of Morgan Stanley's actions trigger an event of default and which actions do not.

An event of default is defined under the Senior Debt Indenture, with respect to any series of debt securities issued under the Senior Debt Indenture, as being:

default in payment of any principal of the debt securities of that series, either at maturity or upon any redemption, by declaration or otherwise;
default for 30 days in payment of any interest on any of the debt securities of that series;
default for 60 days after written notice in the observance or performance of any covenant or agreement in the debt securities of that series or the Senior Debt Indenture (other than a covenant or warranty with respect to the debt securities of that series the breach or nonperformance of which is otherwise included in the definition of "event of default");
events of bankruptcy, insolvency or reorganization; or
any other event of default provided in the supplemental indenture under which that series of debt securities is issued. (Senior Debt Indenture, Section 5.01).

The debt securities issued under the Senior Debt Indenture will not have the benefit of any cross-default or cross-acceleration provisions with Morgan Stanley's other indebtedness.

Acceleration of the Notes upon an Event of Default . The Senior Debt Indenture provides that:

if an event of default due to the default in payment of principal of or interest on the debt securities of that series, or due to the default in the performance or breach of any other covenant or warranty of Morgan Stanley applicable to the debt securities of that series but not applicable to all outstanding debt securities issued under that indenture occurs and is continuing, either the trustee or the holders of not less than 25% in aggregate principal amount of the outstanding debt securities of each affected series, voting as one class, by notice in writing to Morgan Stanley and to the trustee, if given by security holders, may declare the principal of all debt securities of all affected series and interest accrued thereon to be due and payable immediately; and
if an event of default due to a default in the performance of any other covenants or agreements in that indenture applicable to all outstanding debt securities issued under that indenture or due to specified events of bankruptcy, insolvency or reorganization of Morgan Stanley, occurs and is continuing, either the trustee or the holders of not less than 25% in aggregate principal amount of all outstanding debt securities issued under that indenture, voting as one class, by notice in writing to Morgan Stanley and to the trustee, if given by security holders, may declare the principal of all those debt securities and interest accrued thereon to be due and payable immediately. (Senior Debt Indenture, Section 5.01).

Annulment of Acceleration and Waiver of Defaults . The Senior Debt Indenture provides that:

in some circumstances, if any and all events of default under the indenture, other than the nonpayment of the principal of the securities that has become due as a result of an acceleration, have been cured, waived or otherwise remedied, then the holders of a majority in aggregate principal
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amount of all series of outstanding debt securities affected, voting as one class, may waive past defaults and rescind and annul past declarations of acceleration of the debt securities. (Senior Debt Indenture, Section 5.01); and

prior to the acceleration of any debt securities, the holders of a majority in aggregate principal amount of all series of outstanding debt securities with respect to which an event of default has occurred and is continuing, voting as one class, may waive any past default or event of default, other than a default in the payment of principal or interest (unless such default has been cured and an amount sufficient to pay all matured instalments of interest and principal due otherwise than by acceleration has been deposited with the trustee) or a default in respect of a covenant or provision in the indenture that cannot be modified or amended without the consent of the holder of each debt security affected. (Senior Debt Indenture, Section 5.10).

Indemnification of Trustee for Actions Taken on Behalf of Holders of the Notes . The Senior Debt Indenture contains a provision entitling the trustee, subject to the duty of the trustee during a default to act with the required standard of care, to be indemnified by the holders of the Notes before proceeding to exercise any trust or power at the request of holders. (Senior Debt Indenture, Section 6.02). Subject to these provisions and some other limitations, the holders of a majority in aggregate principal amount of each series of outstanding debt securities of each affected series, voting as one class, may direct the time, method and place of conducting any proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee. (Senior Debt Indenture, Section 5.09).

Limitation on Actions by an Individual Holder . The Senior Debt Indenture provides that no individual holder of Notes may institute any action against Morgan Stanley under that indenture, except actions for payment of overdue principal and interest, unless the following actions have occurred:

the holder must have previously given written notice to the trustee of the continuing default;
the holders of not less than 25% in aggregate principal amount of the outstanding debt securities of each affected series, treated as one class, must have (1) requested the trustee to institute that action and (2) offered the trustee reasonable indemnity;
the trustee must have failed to institute that action within 60 days after receipt of the request referred to above; and
the holders of a majority in principal amount of the outstanding debt securities of each affected series, voting as one class, must not have given directions to the trustee inconsistent with those of the holders referred to above. (Senior Debt Indenture, Sections 5.06 and 5.09).

Annual Certification . The Senior Debt Indenture contains a covenant that Morgan Stanley will file annually with the trustee a certificate of no default or a certificate specifying any default that exists. (Senior Debt Indenture, Section 3.05).

Discharge, Defeasance and Covenant Defeasance

Morgan Stanley has the ability to eliminate most or all of its obligations on any series of debt securities prior to maturity if it complies with the following provisions. (Senior Debt Indenture, Section 10.01).

Discharge of Indenture . If at any time Morgan Stanley has:

paid or caused to be paid the principal of and interest on all of the outstanding debt securities in accordance with their terms;
delivered to the applicable trustee for cancellation all of the outstanding debt securities; or
irrevocably deposited with the applicable trustee cash or, in the case of a series of debt securities payable only in U.S. dollars, U.S. government obligations in trust for the benefit of the holders of any series of debt securities issued under the Senior Debt Indenture that have either become due and payable, or are by their terms due and payable within one year or are scheduled for redemption within one year, in an amount certified to be sufficient to pay on each date that they
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become due and payable, the principal of and interest on and any mandatory sinking fund payments for, those debt securities;

and if, in any such case, Morgan Stanley also pays or causes to be paid all other sums payable by Morgan Stanley under the indenture with respect to the securities of such series, then the indenture shall cease to be of further effect with respect to the securities of such series, except as to certain rights and with respect to the transfer and exchange of securities, rights of the holders to receive payment and certain other rights and except that the deposit of cash or U.S. government obligations for the benefit of holders of a series of debt securities that are due and payable or are due and payable within one year or are scheduled for redemption within one year will discharge obligations under the Senior Debt Indenture relating only to that series of debt securities.

Defeasance of a Series of Securities at Any Time . Morgan Stanley may also discharge all of its obligations, other than as to transfers and exchanges, under any series of debt securities at any time, which is referred to herein as "defeasance".

Morgan Stanley may be released with respect to any outstanding series of debt securities from the obligations imposed by Sections 3.06 and 9.01 of the Senior Debt Indenture, which sections contain the covenants described above limiting liens and consolidations, mergers, asset sales and leases, and elect not to comply with those sections without creating an event of default or a default. Discharge under those procedures is called "covenant defeasance."

Defeasance or covenant defeasance may be effected only if, among other things:

Morgan Stanley irrevocably deposits with the relevant trustee cash or, in the case of debt securities payable only in U.S. dollars, U.S. government obligations, as trust funds in an amount certified to be sufficient to pay on each date that they become due and payable or a combination of the above sufficient to pay the principal of and interest on, and any mandatory sinking fund payments for, all of the outstanding debt securities of the series being defeased.
Morgan Stanley delivers to the relevant trustee an opinion of counsel to the effect that:
the holders of the series of debt securities being defeased will not recognize income, gain or loss for U.S. federal income tax purposes as a result of the defeasance or covenant defeasance; and
the defeasance or covenant defeasance will not otherwise alter those holders' U.S. federal income tax treatment of principal and interest payments on the series of debt securities being defeased.

In the case of a defeasance, but not in the case of covenant defeasance, this opinion must be based on a ruling of the Internal Revenue Service or a change in U.S. federal income tax law occurring after 21 November 2011, since that result would not occur under current tax law.

Modification of the Senior Debt Indenture

Modification without Consent of Holders . Morgan Stanley and the trustee may enter into supplemental indentures without the consent of the holders of the Notes to:

secure any of the Notes;
evidence the assumption by a successor corporation of Morgan Stanley's obligations;
add covenants for the protection of the holders of the Notes;
cure any ambiguity or correct any inconsistency;
establish the forms or terms of the debt securities of any series; or
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evidence the acceptance of appointment by a successor trustee. (Senior Debt Indenture, Section 8.01).

Modification with Consent of Holders . Morgan Stanley and the trustee, with the consent of the holders of not less than a majority in aggregate principal amount of each affected series of outstanding debt securities, voting as one class, may add any provisions to, or change in any manner or eliminate any of the provisions of, the Senior Debt Indenture or modify in any manner the rights of the holders of those debt securities. However, Morgan Stanley and the trustee may not make any of the following changes to any outstanding Notes without the consent of each holder that would be affected by such change:

extend the final maturity of the principal;
reduce the principal amount;
reduce the rate or extend the time of payment of interest;
reduce any amount payable on redemption;
change the currency in which the principal and any amount of original issue discount or interest thereon is payable;
modify or amend the provisions for conversion of any currency into another currency;
reduce the amount of any original issue discount security payable upon acceleration or provable in bankruptcy;
alter certain provisions of the Senior Debt Indenture;
impair the right of any holder to institute suit for the enforcement of any payment on the Notes when due; or
reduce the percentage of Notes the consent of whose holders is required for modification of the Senior Debt Indenture. (Senior Debt Indenture, Section 8.02).

Replacement of Notes

At the expense of the holder, Morgan Stanley may, in its discretion, replace any Notes that become mutilated, destroyed, lost or stolen or are apparently destroyed, lost or stolen. The mutilated Notes must be delivered to the trustee, the paying agent and the registrar, or satisfactory evidence of the destruction, loss or theft of the Notes must be delivered to Morgan Stanley, the paying agent, the registrar and the trustee. At the expense of the holder, an indemnity that is satisfactory to Morgan Stanley, the principal paying agent, the registrar and the trustee may be required before a replacement Note will be issued.

Notices

Notices to holders of the Notes will be given by mailing the notices to each holder by first-class mail, postage prepaid, at the respective address of each holder as that address appears upon Morgan Stanley's books. Notices given to the Depositary, as holder of the registered global securities, will be passed on to the beneficial owners of the Notes in accordance with the standard rules and procedures of the Depositary and its direct and indirect participants, including Clearstream, Luxembourg and Euroclear.

Concerning Morgan Stanley's Relationship with the Trustee

Morgan Stanley and its subsidiaries maintain ordinary banking relationships and credit facilities with The Bank of New York Mellon, a New York banking corporation (as successor to JPMorgan Chase Bank, N.A. and J.P. Morgan Trust Company, National Association).

Governing Law

The Notes and the Senior Debt Indenture will be governed by, and construed in accordance with, the laws of the State of New York.

UNITED KINGDOM TAXATION

The following assumes that Morgan Stanley is not resident in the United Kingdom for United Kingdom tax purposes and is not issuing the Notes for the purposes of a trade or other business carried on by it in the United Kingdom and that the interest on the Notes does not have a United Kingdom source.

The following disclosure only applies when any interest on the Notes is paid and the payment of such interest is entrusted to any person in the United Kingdom for payment, distribution or collection.

Her Majesty's Revenue and Customs (" HMRC ") have powers to obtain information, including in relation to interest or payments treated as interest and payments derived from securities. This may include details of the beneficial owners of the Notes (or the persons for whom the Notes are held), details of the persons to whom payments derived from the Notes are or may be paid and information in connection with transactions relating to the Notes. Information obtained by HMRC may be provided to tax authorities in other countries.

EU Savings Directive

Under EC Council Directive 2003/48/EC on the taxation of savings income, each Member State is required to provide to the tax authorities of another Member State details of payments of interest or other similar income paid by a person within its jurisdiction to, or collected by such a person for, an individual resident or certain limited types of entity established in that other Member State; however, for a transitional period, Austria and Luxembourg may instead apply a withholding system in relation to such payments, deducting tax at a rate of 35%. The transitional period is to terminate at the end of the first full fiscal year following agreement by certain non-EU countries to the exchange of information relating to such payments. Luxembourg has announced that it will no longer apply the withholding tax system as from 1 January 2015 and will provide details of payments of interest (or similar income) as from this date.

A number of non-EU countries, and certain dependent or associated territories of certain Member States, have adopted similar measures (either provision of information or transitional withholding) in relation to payments made by a person within its jurisdiction to, or collected by such a person for, an individual resident or certain limited types of entity established in a Member State. In addition, the Member States have entered into provision of information or transitional withholding arrangements with certain of those dependent or associated territories in relation to payments made by a person in a Member State to, or collected by such a person for, an individual resident or certain limited types of entity established in one of those territories.

The Council of the European Union formally adopted a Council Directive amending the Directive on 24 March 2014 (the " Amending Directive "). The Amending Directive broadens the scope of the requirements described above. Member States have until 1 January 2016 to adopt the national legislation necessary to comply with the Amending Directive. The changes made under the Amending Directive include extending the scope of the Directive to payments made to, or collected for, certain other entities and legal arrangements. They also broaden the definition of "interest payment" to cover income that is equivalent to interest.

Investors who are in any doubt as to their position should consult their professional advisers.

UNITED STATES FEDERAL TAXATION

The following is a general discussion of the material U.S. federal income tax consequences and certain estate tax consequences of ownership and disposition of the Notes.

This discussion is based on the Internal Revenue Code of 1986, as amended (the "Code"), administrative pronouncements, judicial decisions and final, temporary and proposed Treasury regulations, all as of the date hereof, changes to any of which subsequent to the date of this UK Prospectus may affect the tax consequences described herein. This discussion does not describe all of the tax consequences that may be relevant to holders in light of their particular circumstances or to holders subject to special rules, as further discussed below. Additionally, any consequences resulting from the Medicare tax on investment income are not discussed in this UK Prospectus.

Persons considering the purchase of the Notes should consult their tax advisers with regard to the application of U.S. federal income tax laws to their particular situations as well as any tax consequences arising under the laws of any state, local or foreign taxing jurisdiction.

Tax Consequences to Non-U.S. Holders

This section applies only to a Non-U.S. Holder. As used herein, the term "Non-U.S. Holder" means a beneficial owner of a Note that is, for U.S. federal income tax purposes:

an individual who is classified as a nonresident alien;
a foreign corporation; or
a foreign estate or trust.

The term "Non-U.S. Holder" does not include any of the following holders:

a holder who is an individual present in the United States for 183 days or more in the taxable year of disposition and who is not otherwise a resident of the United States for U.S. federal income tax purposes;
certain former citizens or residents of the United States; or
a holder for whom income or gain in respect of the Notes is effectively connected with the conduct of a trade or business in the United States.

Such holders should consult their tax advisers regarding the U.S. federal income tax consequences of an investment in the Notes.

Subject to the discussions below concerning backup withholding and FATCA, a Non-U.S. Holder will not be subject to U.S. federal income tax, including withholding tax, on payments of principal or interest on a Note, or proceeds from or gain on the sale or disposition of a Note, provided that:

the Non-U.S. Holder does not own, directly or by attribution, ten per cent. or more of the total combined voting power of all classes of Morgan Stanley's stock entitled to vote;
the Non-U.S. Holder is not a controlled foreign corporation related, directly or indirectly, to Morgan Stanley through stock ownership;
the Non-U.S. Holder is not a bank receiving interest under Section 881(c)(3)(A) of the Code; and
the certification requirement described below has been fulfilled with respect to the beneficial owner, as described below.

Certification Requirement . The certification requirement referred to in the preceding paragraph will be fulfilled if the beneficial owner of that Note (or a financial institution holding a Note on behalf of the

beneficial owner) furnishes to the applicable withholding agent a U.S. Internal Revenue Service ("IRS") Form W-8, on which the beneficial owner certifies under penalties of perjury, that it is not a U.S. person.

U.S. Federal Estate Tax

Individual Non-U.S. Holders and entities the property of which is potentially includible in such an individual's gross estate for U.S. federal estate tax purposes (for example, a trust funded by such an individual and with respect to which the individual has retained certain interests or powers), should note that, absent an applicable treaty benefit, the Notes will be treated as U.S. situs property subject to U.S. federal estate tax if payments on a Note, if received by the decedent at the time of death, would have been subject to U.S. federal withholding tax (even if the W-8 certification requirement described above were satisfied and not taking into account an elimination of such U.S. federal withholding tax due to the application of an income tax treaty or withholding under FATCA).

Non-U.S. Holders should consult their tax advisers regarding the U.S. federal estate tax consequences of an investment in the Notes in their particular situations and the availability of benefits provided by an applicable estate tax treaty, if any.

Backup Withholding and Information Reporting

Information returns may be filed with the IRS in connection with payment on the Notes at maturity as well as in connection with the proceeds from a sale, exchange or other disposition. A Non-U.S. Holder may be subject to backup withholding in respect of amounts paid to the Non-U.S. Holder, unless such Non-U.S. Holder complies with certification procedures to establish that it is not a U.S. person for U.S. federal income tax purposes or otherwise establishes an exemption. Compliance with the certification procedures described above will satisfy the certification requirements necessary to avoid backup withholding. The amount of any backup withholding from a payment to a Non-U.S. Holder will be allowed as a credit against the Non-U.S. Holder's U.S. federal income tax liability and may entitle the Non-U.S. Holder to a refund, provided that the required information is furnished to the IRS.

Tax Consequences to U.S. Holders

This section applies only to U.S. Holders (as defined below) of Notes that meet all of the following conditions:

they are purchased by initial holders who purchase Notes at the "issue price", which will equal the first price at which a substantial amount of the Notes is sold to the public (not including bond houses, brokers or similar persons or organisations acting to the capacity of underwriters, placement agents or wholesalers); and
they are held as capital assets within the meaning of Section 1221 of the Code.

As used herein, the term "U.S. Holder" means, for U.S. federal income tax purposes, a beneficial owner of a Note that is:

a citizen or individual resident of the United States;
a corporation, or other entity taxable as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States, any state thereof or the District of Columbia; or
an estate or trust the income of which is subject to U.S. federal income taxation regardless of its source.

The term "U.S. Holder" also includes certain former citizens and residents of the United States.

This section does not describe all of the tax consequences that may be relevant to a holder in light of the holder's particular circumstances or to holders subject to special rules, such as:

certain financial institutions;
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insurance companies;
certain dealers and traders in securities, commodities or foreign currencies;
investors holding the Notes as part of a hedging transaction, "straddle," conversion transaction, integrated transaction or constructive sale transaction;
U.S. Holders whose functional currency is not the U.S. dollar;
partnerships or other entities classified as partnerships for U.S. federal income tax purposes;
regulated investment companies;
real estate investment trusts;
tax-exempt entities, including "individual retirement accounts" or "Roth IRAs" as defined in Section 408 or 408A of the Code, respectively; or
persons subject to the alternative minimum tax.

General. The rules applicable to debt instruments that are denominated in a currency other than the U.S. dollar could require gain or loss realized upon the sale, exchange or other disposition of the Notes that is attributable to fluctuations in currency exchange rates ("foreign currency gain or loss") to be recharacterized as ordinary income or loss. The rules applicable to the Notes are complex and their application may depend on the holder's particular U.S. federal income tax situation. For example, various elections are available under these rules, and whether a holder should make any of these elections may depend on the holder's particular U.S. federal income tax situation. U.S. Holders should consult their tax advisers regarding the U.S. federal income tax consequences of the ownership and disposition of the Notes.

Payments of Interest on the Notes. A U.S. Holder who uses the cash method of accounting for U.S. federal income tax purposes and who receives a payment of stated interest (or who receives proceeds from a sale, exchange or other disposition attributable to accrued interest) will be required to include in income the U.S. dollar value of the euro payment regardless of whether the payment is in fact converted to U.S. dollars at that time, and this U.S. dollar value will be the U.S. Holder's tax basis in the euros.

In the case of a U.S. Holder that uses the accrual method of accounting for U.S. federal income tax purposes, the holder will be required to include in income the U.S. dollar value of the amount of interest income that has accrued and is otherwise required to be taken into account with respect to the Notes during an accrual period. The U.S. dollar value of the accrued income will be determined by translating the income at an average rate of exchange for the accrual period or, with respect to an accrual period that spans two taxable years, at the average rate for the partial period within the taxable year. In addition to the interest income accrued as described above, the U.S. Holder will recognize ordinary income or loss (which will not be treated as interest income or expense) with respect to accrued interest income on the date the interest payment or proceeds from the sale, exchange or other disposition attributable to accrued interest are actually received. The amount of ordinary income or loss recognized will equal the difference between the U.S. dollar value of the euro payment received (determined based on a spot rate on the date the payment is received) in respect of the accrual period and the U.S. dollar value of interest income that has accrued during the accrual period (as determined above). A U.S. Holder may elect to translate interest income for an interest accrual period into U.S. dollars at the spot rate on the last day of the interest accrual period (or, in the case of a partial accrual period, the spot rate on the last day of the taxable year) or, if the date of receipt is within five business days of the last day of the interest accrual period, the spot rate on the date of receipt. A U.S. Holder that makes this election must apply it consistently to all debt instruments from year to year and cannot change the election without the consent of the IRS.

Tax Basis in the Notes. A U.S. Holder's tax basis in a Note, and the amount of any subsequent adjustment to the holder's tax basis, will be the U.S. dollar value of the euro amount paid for such Note, or of the euro amount of the adjustment, determined on the date of the purchase or adjustment. A U.S. Holder who purchases a Note with previously owned euros will recognize ordinary income or loss in an amount equal

to the difference, if any, between such U.S. Holder's tax basis in the euros and the U.S. dollar fair market value of the Note on the date of purchase.

Sale, Exchange or Retirement of the Notes. Upon the sale, exchange or retirement of a Note, a U.S. Holder will recognize taxable gain or loss equal to the difference between the amount realized on the sale, exchange or retirement and the holder's adjusted tax basis in the Note. For these purposes, the amount realized does not include any amount attributable to accrued but unpaid stated interest. Amounts attributable to accrued but unpaid stated interest are treated as interest as described above. Foreign currency gain or loss realized upon the sale, exchange or retirement of a Note will be ordinary income or loss which will not be treated as interest income or expense. The amount of foreign currency gain or loss generally will equal the difference between (i) the U.S. dollar value of the U.S. Holder's purchase price in euros of the Note, determined on the date the payment is received in exchange for the Note or the Note is disposed of, and (ii) the U.S. dollar value of the U.S. Holder's purchase price in euros of the Note, determined on the date the U.S. Holder acquired the Note. Payments received attributable to accrued interest will be treated in accordance with the rules applicable to payments of interest on the Notes described above. Foreign currency gain or loss realized upon the sale, exchange or retirement of any Note will be recognized only to the extent of the total gain or loss realized by a U.S. Holder on the sale, exchange or retirement of the Note. Any gain or loss realized by a U.S. Holder in excess of the foreign currency gain or loss will be capital gain or loss and will be long-term capital gain or loss if at the time of the sale, exchange or retirement the Note has been held for more than one year. If a U.S. Holder recognizes an ordinary loss upon a sale or other disposition of a Note and such loss is above certain thresholds, the holder may be required to file a disclosure statement with the IRS. See "—Disclosure Requirements" below.

A U.S. Holder will have a tax basis in any euros received on the sale, exchange or retirement of a Note equal to the U.S. dollar value of the euros, determined at the time of such sale, exchange or retirement. A cash-method taxpayer who buys or sells a Note that is traded on an established market is required to translate units of foreign currency paid or received into U.S. dollars at the spot rate on the settlement date of the purchase or sale. Accordingly, no exchange gain or loss will result from currency fluctuations between the trade date and the settlement of the purchase or sale. An accrual-method taxpayer may elect the same treatment for all purchases and sales of foreign currency obligations if such obligations are traded on an established securities market. This election cannot be changed without the consent of the IRS. Any gain or loss realized by a U.S. Holder on a sale or other disposition of euros (including its exchange for U.S. dollars or its use to purchase the Notes) will be ordinary income or loss.

Backup Withholding and Information Reporting

Backup withholding may apply in respect of payments on the Notes and the units and the proceeds from a sale or other disposition of the Notes, unless a U.S. Holder provides proof of an applicable exemption or a correct taxpayer identification number, and otherwise complies with applicable requirements of the backup withholding rules. The amounts withheld under the backup withholding rules are not an additional tax and may be refunded, or credited against the U.S. Holder's U.S. federal income tax liability provided that the required information is furnished to the IRS. In addition, information returns may be filed with the IRS in connection with payments on the Notes and the proceeds from a sale or other disposition of the Notes, unless the U.S. Holder provides proof of an applicable exemption from the information reporting rules.

Disclosure Requirements

Applicable Treasury regulations require taxpayers that participate in certain "reportable transactions" to disclose their participation to the IRS by attaching Form 8886 to their tax returns and to retain a copy of all documents and records related to the transaction. In addition, organizers and sellers of such transactions are required to maintain records, including lists identifying investors in the transaction, and must furnish those records to the IRS upon demand. A transaction may be a "reportable transaction" based on any of several criteria. Whether an investment in a Note constitutes a "reportable transaction" for any holder depends on the holder's particular circumstances. Holders should consult their tax advisers concerning any possible disclosure obligation that they may have with respect to their investment in the Notes and should be aware that Morgan Stanley (or other participants in the transaction) may determine that the investor list maintenance requirement applies to the transaction and comply accordingly with this requirement.

FATCA Legislation

Legislation commonly referred to as "FATCA" generally imposes a withholding tax of 30% on payments to certain non-U.S. entities (including financial intermediaries) with respect to certain financial instruments, unless various U.S. information reporting and due diligence requirements have been satisfied. An intergovernmental agreement between the United States and the non-U.S. entity's jurisdiction may modify these requirements. This legislation generally applies to certain financial instruments that are treated as paying U.S.-source interest or other U.S.-source "fixed or determinable annual or periodical" income. Withholding (if applicable) applies to any payment of interest on the Notes and, for dispositions after December 31, 2016, any payment of gross proceeds of the disposition (including upon retirement) of the Notes. If withholding applies to the Notes, we will not be required to pay any additional amounts with respect to amounts withheld. Both U.S. and Non-U.S. Holders should consult their tax advisers regarding the potential application of FATCA to the Notes.

PLAN OF DISTRIBUTION

The managers are: Morgan Stanley & Co. International plc, Mitsubishi UFJ Securities International plc, Banco Santander, S.A., Commerzbank Aktiengesellschaft, Deutsche Bank AG, London Branch, Erste Group Bank AG , ING Bank N.V. Belgian Branch, Lloyds Bank plc and Natixis. .

United Kingdom

Each of the managers which participated in the original distribution of the Notes represented and agreed that:

(1) it has complied and will comply with all applicable provisions of the Financial Services and Markets Act 2000 (the " FSMA ") with respect to anything done by it in relation to the Notes in, from or otherwise involving the United Kingdom; and
(2) it has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of Section 21 of the FSMA) received by it in connection with the issue or sale of any securities in circumstances in which Section 21(1) of the FSMA does not apply to Morgan Stanley.

Japan

The Notes have not been, and will not be, registered under the Financial Instruments and Exchange Law of Japan (Law No.25 of 1948, as amended) (the "FIEL"). Accordingly, the Notes may not be offered or sold, directly or indirectly, in Japan or to, or for the account or benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan) or to, or for the account or benefit of, others for the re-offering or resale, directly or indirectly, in Japan or to, or for the account or benefit of, any resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the FIEL and any other applicable laws, regulations and ministerial guidelines of Japan.

France

Morgan Stanley has represented and agreed, and the managers have represented and agreed, that Morgan Stanley and the managers will not offer or sell, directly or indirectly, any Notes in the Republic of France and will not distribute or cause to be distributed in the Republic of France this UK Prospectus or any other offering material relating to the Notes, except to qualified investors ( investisseurs qualifiés ) as defined in and in accordance with Articles L.411-2 and D.411-1 of the French Code Monétaire et Financier .

Hong Kong

WARNING: The contents of this UK Prospectus not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the offer. If you are in any doubt about any of the contents of this UK Prospectus, you should obtain independent professional advice.

The Notes have not been offered or sold and will not be offered or sold in Hong Kong, by means of any document, other than (i) to "professional investors" as defined in the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) (the " SFO ") and any rules made under that Ordinance or (ii) in other circumstances which do not result in the document being a "prospectus" as defined in the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap.32 of the Laws of Hong Kong) or which do not constitute an offer to the public within the meaning of that Ordinance. No person has issued or may issue or had or may have in its possession for the purposes of issue, whether in Hong Kong or elsewhere, any advertisement, invitation or document relating to the Notes, which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the applicable securities law of Hong Kong) other than with respect to the Notes which are intended to be disposed of only to persons outside Hong Kong or only to "professional investors" as defined in the SFO and any rules made under that Ordinance.

Singapore

This UK Prospectus has not been registered as a prospectus under the Securities and Futures Act, Chapter 289 of Singapore, as amended (the " SFA "), by the Monetary Authority of Singapore and the notes will be offered pursuant to exemptions under the SFA. Accordingly, neither this UK Prospectus or any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the Notes may be circulated or distributed, nor may the Notes be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor as defined in Section 4A of the SFA (an " Institutional Investor ") pursuant to Section 274 of the SFA, (ii) to a relevant person as defined in Section 275(2) of the SFA (a " Relevant Person "), or to any person pursuant to an offer referred to in Section 275(1A) of the SFA, and in accordance with the conditions specified in Section 275 of the SFA, or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable exemption or provision of the SFA. Where Notes are subscribed or purchased pursuant to an offer made in reliance on Section 275 by a Relevant Person which is:

(a) a corporation (which is not an accredited investor as defined in Section 4A of the SFA (an " Accredited Investor ")) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an Accredited Investor; or
(b) a trust (where the trustee is not an Accredited Investor) whose sole purpose is to hold investments and each beneficiary of the trust is an individual who is an Accredited Investor,

the securities (as defined in Section 239(1) of the SFA) of that corporation or the beneficiaries' rights and interests (howsoever described) in that trust shall not be transferred for six months after that corporation or that trust has acquired the Notes pursuant to an offer made under Section 275 of the SFA except:

(1) to an Institutional Investor or to a Relevant Person, or to any person arising from an offer referred to in Section 275(1A) of the SFA (in the case of that corporation) or Section 276(4)(i)(B) of the SFA (in the case of that trust);
(2) where no consideration is or will be given for the transfer;
(3) where the transfer is by operation of law; or
(4) pursuant to Section 276(7) of the SFA or Regulation 32 of the Securities and Futures (Offer of Investments ) (Shares and Debentures) Regulations.

European Economic Area

In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a " Relevant Member State "), each manager has represented and agreed, and each further agent, dealer and underwriter appointed with respect to any securities will be required to represent and agree, that with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the " Relevant Implementation Date ") it has not made and will not make an offer of securities which are the subject of the offering contemplated by this UK Prospectus in relation thereto to the public in that Relevant Member State except that it may, with effect from and including the Relevant Implementation Date, make an offer of such securities to the public in that Relevant Member State:

(1) if the pricing supplement in relation to the securities specifies that an offer of those securities may be made other than pursuant to Article 3(2) of the Prospectus Directive in that Relevant Member State (a " Non-exempt Offer "), following the date of publication of a prospectus in relation to such securities which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, provided that any such prospectus has subsequently been completed by the pricing supplement contemplating such Non-exempt Offer, in accordance with the Prospectus Directive, in the period beginning and ending on the dates specified in such prospectus or pricing supplement, as applicable;
(2) at any time to any legal entity which is a qualified investor as defined in the Prospective Directive;
39-
(3) at any time to fewer than 100, or, if the Relevant Member State has implemented the relevant provision of the 2010 PD Amending Directive, 150 natural or legal persons (other than qualified investors as defined in the Prospectus Directive) subject to obtaining the prior consent of the relevant agent, underwriter or dealer nominated by Morgan Stanley for any such offer; or
(4) at any time in any other circumstances falling within Article 3(2) of the Prospectus Directive,

provided that no such offer of securities referred to in (2) to (4) above shall require Morgan Stanley or any agent, underwriter or dealer to publish a prospectus pursuant to Article 3 of the Prospectus Directive.

For the purposes of this provision, the expression an "offer of securities to the public" in relation to any securities in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the securities to be offered so as to enable an investor to decide to purchase or subscribe the securities, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State, the expression "Prospectus Directive" means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State) and includes any relevant implementing measure in each Relevant Member State and the expression "2010 PD Amending Directive" means Directive 2010/73/EU.

Other than with respect to the admission to listing and trading as is specified in this UK Prospectus, no action has been or will be taken in any country or jurisdiction by Morgan Stanley or any manager that would permit a public offering of any securities or possession or distribution of any offering material in relation thereto, in any country or jurisdiction where action for that purpose is required. Persons into whose hands this UK Prospectus comes are required by Morgan Stanley and the managers to comply with all applicable laws and regulations in each country or jurisdiction in or from which they purchase, offer, sell or deliver securities or have in their possession or distribute such offering material, in all cases at their own expense.

The managers may make a market in the Notes as applicable laws and regulations permit. The managers are not obligated to do so, however, and the managers may cease to make a market at any time without notice. No assurance can be given as to the liquidity of any trading market for the securities or if separable, any other securities included in any units.

USE OF PROCEEDS

The Issuer intends to use the net proceeds from the sale of the Notes for general corporate purposes.

BENEFIT PLAN INVESTOR CONSIDERATIONS

Each fiduciary of a pension, profit-sharing or other employee benefit plan subject to the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), which is referred to herein as a "plan," should consider the fiduciary standards of ERISA in the context of the plan's particular circumstances before authorizing an investment in these securities. Accordingly, among other factors, the fiduciary should consider whether the investment would satisfy the prudence and diversification requirements of ERISA and would be consistent with the documents and instruments governing the plan.

In addition, Morgan Stanley and certain of its subsidiaries and affiliates, including MSI plc, may be considered a "party in interest" within the meaning of ERISA, or a "disqualified person" within the meaning of the Code, with respect to many plans, as well as many individual retirement accounts and Keogh plans (also "plans"). Prohibited transactions within the meaning of ERISA or the Code would likely arise, for example, if these securities are acquired by or with the assets of a plan with respect to which MSI plc or any of its affiliates is a service provider or other party in interest, unless the securities are acquired pursuant to an exemption from the "prohibited transaction" rules. A violation of these "prohibited transaction" rules could result in an excise tax or other liabilities under ERISA and/or Section 4975 of the Code for those persons, unless exemptive relief is available under an applicable statutory or administrative exemption.

The U.S. Department of Labor has issued five prohibited transaction class exemptions ("PTCEs") that may provide exemptive relief for direct or indirect prohibited transactions resulting from the purchase or holding of these securities. Those class exemptions are PTCE 96-23 (for certain transactions determined by in-house asset managers), PTCE 95-60 (for certain transactions involving insurance company general accounts), PTCE 91-38 (for certain transactions involving bank collective investment funds), PTCE 90-1 (for certain transactions involving insurance company separate accounts) and PTCE 84-14 (for certain transactions determined by independent qualified professional asset managers). In addition, ERISA Section 408(b)(17) and Section 4975(d)(20) of the Code may provide an exemption for the purchase and sale of securities and the related lending transactions, provided that neither the issuer of the securities nor any of its affiliates has or exercises any discretionary authority or control or renders any investment advice with respect to the assets of any plan involved in the transaction, and provided further that the plan pays no more, and receives no less, than "adequate consideration" in connection with the transaction (the so-called "service provider" exemption). There can be no assurance that any of these class or statutory exemptions will be available with respect to transactions involving these securities.

Because Morgan Stanley may be considered a party in interest with respect to many plans, these securities may not be purchased, held or disposed of by any plan, any entity whose underlying assets include "plan assets" by reason of any plan's investment in the entity (a "plan asset entity") or any person investing "plan assets" of any plan, unless such purchase, holding or disposition is eligible for exemptive relief, including relief available under PTCEs 96-23, 95-60, 91-38, 90-1, 84-14 or the service provider exemption or such purchase, holding or disposition is otherwise not prohibited. Any purchaser, including any fiduciary purchasing on behalf of a plan, transferee or holder of these securities will be deemed to have represented, in its corporate and its fiduciary capacity, by its purchase and holding of these securities that either (a) it is not a plan or a plan asset entity, is not purchasing such securities on behalf of or with "plan assets" of any plan, or with any assets of a governmental, non-U.S. or church plan that is subject to any federal, state, local or non-U.S. law that is substantially similar to the provisions of Section 406 of ERISA or Section 4975 of the Code ("Similar Law") or (b) its purchase, holding and disposition are eligible for exemptive relief or such purchase, holding and disposition are not prohibited by ERISA or Section 4975 of the Code or any Similar Law.

Due to the complexity of these rules and the penalties that may be imposed upon persons involved in nonexempt prohibited transactions, it is particularly important that fiduciaries or other persons considering purchasing these securities on behalf of or with "plan assets" of any plan consult with their counsel regarding the availability of exemptive relief.

Each purchaser and holder of these securities has exclusive responsibility for ensuring that its purchase, holding and disposition of the securities do not violate the prohibited transaction rules of ERISA or the Code or any Similar Law. The sale of any of these securities to any plan or plan subject to Similar Law is in no respect a representation by Morgan Stanley or any of its affiliates or representatives that such an investment meets all relevant legal requirements with respect to investments by plans generally or any particular plan, or that such an investment is appropriate for plans generally or any particular plan.

PRINCIPAL EXECUTIVE OFFICES OF

MORGAN STANLEY

REGISTERED OFFICE OF MORGAN STANLEY IN DELAWARE

1585 Broadway New York, New York 10036 U.S.A. Tel: +1 (212) 761 4000

The Corporation Trust Center 1209 Orange Street Wilmington, Delaware 19801 U.S.A.

AGENT

Morgan Stanley & Co. International plc Cabot Square Canary Wharf London E14 4QA

PAYING AGENT

The Bank of New York Mellon Trinity Tower 9 Thomas More Street London E1W 1YT U.K.

LEGAL ADVISORS TO THE ISSUER AND TO THE DISTRIBUTION AGENTS

As to English law:

Clifford Chance LLP 10 Upper Bank Street Canary Wharf London E14 5JJ U.K

To the Issuer as to U.S. law: To the Agents as to U.S. law:

Davis Polk & Wardwell LLP Sidley Austin LLP 450 Lexington Avenue 787 Seventh Avenue New York, New York 10017 New York, New York 10019 U.S.A. U.S.A

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM OF MORGAN STANLEY

Deloitte & Touche LLP Two World Financial Center New York, New York 10281

U.S.A.

AI assistant

MORGAN STANLEY — Capital/Financing Update 2014

29766_rns_2014-12-17_09c7f7af-4811-4bd0-8a18-16b744a7d6b0.pdf

UK PROSPECTUS

€1,250,000,000 Floating Rate Senior Registered Notes Due 2019 (the " Notes ")

MORGAN STANLEY

CONTENTS

Page

RISK FACTORS

RISKS RELATING TO MORGAN STANLEY

Liquidity and Funding Risk

Liquidity is essential to Morgan Stanley's businesses and Morgan Stanley relies on external sources to finance a significant portion of Morgan Stanley's operations.

Morgan Stanley's borrowing costs and access to the debt capital markets depend significantly on Morgan Stanley's credit ratings.

Morgan Stanley is a holding company and depends on payments from Morgan Stanley's subsidiaries.

Morgan Stanley's liquidity and financial condition have in the past been, and in the future could be, adversely affected by U.S. and international markets and economic conditions.

Market Risk

Morgan Stanley's results of operations may be materially affected by market fluctuations and by global and economic conditions and other factors.

Morgan Stanley may experience declines in the value of Morgan Stanley's financial instruments and other losses related to volatile and illiquid market conditions.

Holding large and concentrated positions may expose Morgan Stanley to losses.

Morgan Stanley has incurred, and may continue to incur, significant losses in the real estate sector.

Credit Risk

Morgan Stanley is exposed to the risk that third parties that are indebted to Morgan Stanley will not perform their obligations.

A default by a large financial institution could adversely affect financial markets generally.

Operational Risk

Morgan Stanley is subject to operational risk that could adversely affect Morgan Stanley's businesses.

Legal, Regulatory and Compliance Risk

The financial services industry is subject to extensive regulation, which is undergoing major changes that will impact Morgan Stanley's business.

The financial services industry faces substantial litigation and is subject to extensive regulatory investigations, and Morgan Stanley may face damage to Morgan Stanley's reputation and legal liability.

Morgan Stanley's business, financial condition and results of operations could be adversely affected by governmental fiscal and monetary policies.

Morgan Stanley's commodities activities subject Morgan Stanley to extensive regulation, potential catastrophic events and environmental risks and regulation that may expose Morgan Stanley to significant costs and liabilities.

A failure to address conflicts of interest appropriately could adversely affect Morgan Stanley's businesses and reputation.

Risk Management

Morgan Stanley's risk management strategies may not be fully effective in mitigating its risk exposures in all market environments or against all types of risk.

Competitive Environment

Morgan Stanley face strong competition from other financial services firms, which could lead to pricing pressures that could materially adversely affect Morgan Stanley's revenue and profitability.

Automated trading markets may adversely affect Morgan Stanley's business and may increase competition.

Morgan Stanley's ability to retain and attract qualified employees is critical to the success of its business and the failure to do so may materially adversely affect its performance.

International Risk

Acquisition and Joint Venture Risk

RISK FACTORS RELATING TO THE NOTES

Foreign-Currency Risks

Exchange rates and exchange controls may affect Notes' value or return

Currency Conversions May Affect Payments

Secondary trading of the Notes may be limited

Exchange Rates May Affect the Value of a New York Judgment Involving Non-U.S. Dollar Securities

The Notes are not insured bank deposits

INCORPORATION BY REFERENCE

DESCRIPTION OF MORGAN STANLEY

DESCRIPTION OF THE NOTES

General

" Base Rate " means EURIBOR.

" Maturity Date " means 19 November 2019.

" Spread " means plus 0.70%.

Form

Denomination of the Notes

Security Identification Number

Ranking of the Notes

Exchange and Transfer

Interest

Interest and Principal Payments

Redemption and Repurchase

Tax Redemption

Payment of Additional Amounts

Covenants Restricting Pledges, Mergers and Other Significant Corporate Actions

Events of Default

Discharge, Defeasance and Covenant Defeasance

Modification of the Senior Debt Indenture

Replacement of Notes

Notices

Concerning Morgan Stanley's Relationship with the Trustee

Governing Law

UNITED KINGDOM TAXATION

EU Savings Directive

UNITED STATES FEDERAL TAXATION

Tax Consequences to Non-U.S. Holders

U.S. Federal Estate Tax

Backup Withholding and Information Reporting

Tax Consequences to U.S. Holders

Backup Withholding and Information Reporting

Disclosure Requirements

MORGAN STANLEY Capital/Financing Update 2014