EU Equity pre- and post-trade transparency regulation (LBF vol. 21) 2021/3.III.3.2:3.III.3.2 Factor 2: national regulation

EU Equity pre- and post-trade transparency regulation (LBF vol. 21) 2021/3.III.3.2

3.III.3.2 Factor 2: national regulation

Documentgegevens:

mr. J.E.C. Gulyás, datum 01-02-2021

Datum: 01-02-2021
Auteur: mr. J.E.C. Gulyás
JCDI: JCDI:ADS267319:1
Vakgebied(en): Financieel recht / Bank- en effectenrecht
Financieel recht / Europees financieel recht
Financiële dienstverlening / Financieel toezicht

The second factor was national regulation. In the majority of Member States transparency requirements not only applied to trades that took place through the technical systems of an RM, but also to those trades that took place under the rules of an RM.1 As a result, these trades were subject to equity pre-trade transparency obligations for RMs. The ISD, national and/or RM rulebook pre-trade transparency obligations for RMs applied here. CESR noted that for this reason: ‘(…) transparency obligations frequently apply to exchange members undertaking internal crossings and crossings with others outside the order-book’.2 Hence, RMs (not: ATSs and order internalising systems) were often in charge of equity pre-trade data publication.3

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CESR, Publication and Consolidation of MiFID Market Transparency, October 2006(CESR/06-551), p. 4. MiFID I harmonises the concept of a ‘system’. MiFID I, among other things, notes transactions concluded under the rules of an RM or MTF are ‘considered to be concluded under the systems of an RM or an MTF’ (recital 6 MiFID I Directive). A similar interpretation is in place under MiFID II (recital 7 MiFIR).

CESR, Publication and Consolidation of MiFID Market Transparency, October 2006(CESR/06-551), p. 4.

FESCO stated that ATS and order internalising systems were not as significant a phenomenon in Europe as they were, for example, in the US. FESCO indicated there were fewer opportunities for ATSs and order internalising systems to exploit compared to exchanges (RMs) (FESCO, The Regulation of Alternative Trading Systems in Europe: A paper for the EU Commission, September 2000(FESCO/00-064c), p. 6).