The European Securities and Markets Authority ("ESMA") issued updated Questions and Answers ("Q&As") on the implementation of the Markets in Financial Instruments Directive ("MiFID II") and Regulation ("MiFIR"). MiFID II and MiFIR will be applicable across the European Union ("EU") beginning on January 3, 2018.
According to ESMA, the purpose of the Q&As is to provide clarity on the application of MiFID II and MiFIR and to promote common supervisory approaches to their application across EU member states. The guidance documents provide relevant information for investors, regulators, and other market participants.
ESMA published updated Q&As in relation to the practical application of MiFID II and MiFIR in the following areas:
- Market structure, including direct electronic access and algorithmic trading (including high frequency trading), the tick size regime, multilateral and bilateral trading systems; making data available to the public in a disaggregated form; and access to central counterparties and trading venues;
- Commodity derivatives, including position limits and position reporting; and
- Data reporting, including recordkeeping and data fields.
The Managed Funds Association expressed support for the guidance and recommendations contained in the Q&As, particularly regarding addressing key barriers to "non-discriminatory access to EU trading venues."
ESMA will review the Q&As on a regular basis and update them as required.
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