5.II.2.2.6.5 Level 2 text: definition of a negotiated transaction

The Council, as reflected in the final MiFIR text, wanted ESMA to assist the Commission in specifying the meaning of a ‘negotiated transaction’ through draft regulatory technical standards.1 In drafting the technical standards, ESMA proposed to largely retain the meaning of a ‘negotiated transaction’ as provided under MiFID I. ‘Largely’, since ESMA widened its scope to include the circumstance where an investment firm deals on own account with another member or participant on behalf of a client, and not just for the account of a client.2 The Commission adopted ESMA’s advice. This is reflected in the MiFID II level 2 text. MiFID II provides the same definition of negotiated transactions that ESMA proposed.3