EU Equity pre- and post-trade transparency regulation (LBF vol. 21) 2021/18.IV.1.2.1.1:18.IV.1.2.1.1 Difference 1: change in financial instruments

EU Equity pre- and post-trade transparency regulation (LBF vol. 21) 2021/18.IV.1.2.1.1

18.IV.1.2.1.1 Difference 1: change in financial instruments

Documentgegevens:

mr. J.E.C. Gulyás, datum 01-02-2021

Datum: 01-02-2021
Auteur: mr. J.E.C. Gulyás
JCDI: JCDI:ADS267162:1
Vakgebied(en): Financieel recht / Bank- en effectenrecht
Financieel recht / Europees financieel recht
Financiële dienstverlening / Financieel toezicht

MiFID I limited the scope of the EU pre- and post-trade transparency rules to shares admitted to trading on an RM (instead of to all financial instruments dealt in on an RM, which was the case under the ISD).1 A Member State option was in place to expand the scope of the MiFID I pre- and post-trade transparency rules to other financial instruments than shares.2 Although controversial, the Commission argued that harmonised pre- and post-trade transparency rules could only be economically justified in relation to shares.3 The MiFID I pre- and post-trade transparency only applied to shares admitted to trading on an RM. The qualification of ‘admitted to trading on an RM’ was (and still is) considered to be a quality label for financial instruments, including in terms of (pre- and post-trade) transparency.4

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Art. 21 ISD. For the sake of completeness, FESCO/CESR also recommended pre- and post-trade transparency rules for alternative trading systems under the ISD. See paragraphs above.

Recital 46 MiFID I.

Commission, Revision of Investment Services Directive (93/22/EEC), Second Consultation, 25 March 2002. For an examination, reference is made to chapter 4 (pre-trade transparency) and chapter 8 (post-trade transparency).

As noted in paragraph 1, the term ‘equity pre- and post-trade transparency’ concerns financial data about equity (e.g. shares or ETFs) prior to the equity trade (pre-trade) and/or after the equity trade has been concluded (post-trade). Examples of equity pre- and post-trade data include bids and offers and order sizes (pre-trade data), as well as prices and volumes of completed equity trades (post-trade data). Equity pre- and post-trade transparency should not be confused with other types of financial data, such as annual reports, prospectuses or data that is reported to supervisors (transaction reports). (Equity) Pre- and post-trade transparency (data) is a species of the genus ‘financial market data’. For an examination of the term ‘financial market data’, as well as the term ‘equity’, reference is made to chapter 1(section IV).