The European Securities and Markets Authority (ESMA) has updated its questions and answers on the implementation of investor protection topics under MiFID II and MiFIR.
These updates provide new information surrounding best execution and details on costs and charges.
New answers in relation to best execution have been given for topics surrounding the reporting for venues on the ‘trading mode’ according to RTS 27; reporting for venues and firms on template fields of RTS 27 and 28 if the required content is not applicable to their activities; reporting on ‘passive’ and ‘aggressive’ orders for firms using quote-driven systems to have client orders executed; and RTS 28 reporting and execution venues.
Answers under information on costs and charges have also been updated. New information has been supplied for ex-ante information in case of sell orders and telephone trading, the use of assumed investment amounts for ex-ante information for investment services and products with non-linear charging structures, and the use of ranges and maximum amount/percentages for ex-ante information.
Following the update, ESMA will continue to develop the Q&A section, adding both questions and answers to topics covered or in new sections regarding MiFID II protection areas not currently addressed in the list.
These Q&As are designed to give a common supervisory approach and practice to the implementation of MiFID II and MiFIR.
Earlier in the month, ESMA delayed the release of its systematic internaliser (SI) regime data for equity, equity-like instruments and bonds. This information is designed to help investment firms conduct their SI regimes which is required of them under MiFID II.
The regulation stipulates investors must analyse whether their assts are an SI, which is based on the trading it undertakes is within a relative threshold with the volume of transactions executed EU-wide. The delay for the data came due to a technical issue.
Some of this information was released just days later, but information for SI calculations of derivatives will aim to be released by 2020 at the latest.
Copyright © 2018 RegTech Analyst
