19.III.3.2 New types of venues

Technological innovation resulted in new types of venues, more specifically alternative trading systems and order internalising systems under the ISD and broker crossing networks under MiFID I. The EU response has been the introduction of MTFs and SIs under MiFID I, which since MiFID I have been subject to harmonised equity pre- and post-trade transparency rules. MiFID II tightened the classifications of both MTFs and SIs to ensure sufficient transparency.1 Technological innovation enables new automated quoting systems of SIs (de facto being broker crossing networks) and the rise of so-called frequent batch auctions. MiFID II responded by prohibiting automated quoting systems of SIs and ESMA wants to introduce a stricter approach for frequent batch auctions in the ESMA MiFID II Review. The result has been more EU equity pre- and post-trade transparency regulation.