ESMA Regulation - Consultation Paper - MiFID II/MiFIR - May 22, 2014
|MiFID Effective||MiFID II/MiFIR Proposal||Entered into Force||Rules Applicable|
|November 1, 2007||October 20, 2011||July 2, 2014||January 2017|
On May 22nd, 2014 The European Securities and Markets Authority (ESMA) published its consultation paper on MiFID II/MiFIR. The MiFID II/MiFIR legislative package passed in the European Parliament on May 15th, 2014. These reforms seek to increase market transparency and stability.
The MiFID II/MiFIR reforms passed the European Parliament in 2014. This legislative package required ESMA to develop rules and guidelines on various aspects of the market. A study commissioned by the European Commission identified seven problem areas:
- Lack of level playing field between markets and market participants, in light of industry changes including the rise of high-frequency trading and over-the-counter (OTC) derivatives;
- Difficulties for Small and Medium Enterprises (SMEs) to access financial markets
- Lack of transparency for market participants, given the increased use of dark pools;
- Lack of transparency for regulators and insufficient supervisory powers in key areas;
- Insufficient investor protection in such areas as mis-selling to clients and trade execution quality;
- Weaknesses in some areas of the organization, processes, risk controls and assessment of market participants; and
- Obstacles to competition in clearing infrastructures.
These reforms seek to remedy these issues as well promote financial stability
Summary of the Consultation Paper
The 311 page document consists of 8 Sections.
- Section 1, Overview :
- Section 2, Investor Protection:
- Section 3, Transparency:
- Section 4, Data Publication:
- Section 5, Micro-Structural Issues:
- Section 6, Requirements Applying on and to Trading Venues:
- Section 7, Commodity Derivatives :
- Section 8, Portfolio Compression :
ESMA accepted comments on the consultation paper until July 10, 2014. To see comments press here