On 20 February 2024, the Council of the EU issued a press release stating that it has adopted the proposed Directive amending MiFID II and the proposed Regulation amending MiFIR as regards enhancing data transparency, removing obstacles to the emergence of consolidated tapes, optimising the trading obligations and prohibiting receiving payment for order flow.

Consolidated market data

The press release states that the new rules will establish EU level ‘consolidated tapes,’ or centralised data feeds, for different types of assets. This will bring together market data provided by platforms on which financial instruments are traded in the EU. The consolidated tapes will aim to publish the information as close as possible to real time. Consequently, investors will enjoy up-to-date transaction information for the whole of the EU. This will improve access to key information for both professional and retail investors; examples being the price of instruments and the volume and time of transactions.

Payment for order flow

The press release adds that the new rules impose a general ban on ‘payment for order flow’ (PFOF). This is a practice where brokers receive payments for forwarding client orders to certain trading platforms. Member States where the practice of PFOF already exists may allow investment firms under its jurisdiction to be exempt from the ban (provided that PFOF is only provided to clients in that Member State). However, this practice must be phased out by 30 June 2026. The review also introduces new rules on commodity derivatives.

Next steps

This is the final step of the adoption procedure. The texts will now be published in the Official Journal of the EU and enter into force 20 days later. The Regulation will apply immediately in all EU countries, whereas Member States will have 18 months to bring into force the laws, regulations and administrative provisions necessary to comply with the Directive.