5.VII.3.1 General

Another part of the MiFID II review is the share trading-obligation. As examined in section VI, the MiFID II share trading-obligation requires investment firms to undertake certain share transactions on an RM, MTF, SI, or equivalent third-country trading venue, unless MiFID II exceptions apply.1 The main problems identified in the MiFID II Review about the share trading-obligation concern (1) third country-shares, (2) whether or not to retain SIs as eligible venues, and (3) a potential lack of clarity on the share trading-obligation provisions.2 A main observation of ESMA is that, despite the share trading-obligation, there has not been a significant change in the share trading volume executed on RMs, MTFs, and investment firms operating outside such venues, including SIs.3 To change the situation, ESMA proposes a stricter approach for the MiFID II share trading-obligation. At the same time, ESMA wants to keep third-country shares outside the MiFID II share trading-obligation scope (no extra-territorial reach).