EU Equity pre- and post-trade transparency regulation (LBF vol. 21) 2021/12.II.5.2:12.II.5.2 Preventing duplicative post-trade reports

EU Equity pre- and post-trade transparency regulation (LBF vol. 21) 2021/12.II.5.2

12.II.5.2 Preventing duplicative post-trade reports

Documentgegevens:

mr. J.E.C. Gulyás, datum 01-02-2021

Datum: 01-02-2021
Auteur: mr. J.E.C. Gulyás
JCDI: JCDI:ADS266534:1
Vakgebied(en): Financieel recht / Bank- en effectenrecht
Financieel recht / Europees financieel recht
Financiële dienstverlening / Financieel toezicht

In the context of post-trade data publication, MiFID I provided additional rules to prevent duplicative post-trade reports concerning trades executed outside the rules of an RM or MTF. Where a trade was executed outside an RM or MTF both parties needed to agree on who needed to publish the post-trade report.1 In the absence of such an agreement, MiFID I specified a default list to determine who was responsible for the publication.2 MiFID I required both parties to the trade to take all reasonable steps to ensure that the transaction was made public as a single transaction.3

CESR noted that, despite the MiFID I-rules, there was a risk that MiFID I post-trade data could be duplicated if a single published trade was counted more than once during the consolidation process.4 With the aim of preventing artificially inflated trading volumes, CESR considered that ‘for the purpose of facilitating consolidation of transparency data with similar data from other sources,5 the use of only one publication arrangement for a single trade was in compliance with MiFID I’.6 CESR also recommended to flag the ‘primary publication channel’. The aim here was to enable data consolidators in distinguishing between primary and secondary publications and so limit the possibility for duplication.7

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Art. 27(4) MiFID I.

The default list included: (a) the investment firm that sold the share concerned; (b) the investment firm that acted on behalf of or arranged the trade for the seller; (c) the investment firm that acted on behalf of or arranged the transaction for the buyer; (d) the investment firm that bought the share concerned. In the absence of an agreement, the information needed to be made public by the investment firm determined by proceeding sequentially from point (a) to point (d) until the first point that applied to the case in question (art. 27(4) MiFID I Implementing Regulation.

Art. 27(4) MiFID I Implementing Regulation. MiFID I did not specify the meaning of ‘all reasonable steps to ensure that the transaction was made public as a single transaction’ (ibid).

CESR, Publication and Consolidation of MiFID Market Transparency Data, February 2007 (CESR/07-043), p. 5.

Art. 32(b) MiFID I Implementing Regulation.

CESR, Publication and Consolidation of MiFID Market Transparency Data, February 2007 (CESR/07-043), p. 5-6. CESR emphasised that investment firms were free to use several publication channels, but each trade conducted should be published through only one of the channels used, rather than all of them as a means to facilitate the consolidation process (ibid).

CESR, Publication and Consolidation of MiFID Market Transparency Data, February 2007 (CESR/07-043), p. 5-6. CESR noted that, where the information was published through the entity proprietary system, it would not be necessary to flag the information as a ‘primary publication’ (ibid).