On 28 January, the European Securities and Markets Authority (ESMA) issued a consultation paper on its opinion on the trading venue perimeter.

The consultation paper follows ESMA’s final report on the functioning of Organised Trading Facilities (OTFs) under MiFID II, in which ESMA committed to publishing an opinion clarifying the definition of multilateral systems and providing guidance on when systems should be considered as multilateral systems and, in consequence, apply for authorisation as trading venues.

The consultation paper contains proposals aiming at clarifying the MiFID II provisions relating to multilateral systems and the trading venue authorisation perimeter and is organised as follows:

  • Section 3 looks at the definition of multilateral systems and the implications of changes bought to trading venue authorisation under MiFID II, in particular the requirement for all multilateral systems to be authorised as trading venues.
  • Section 4 considers certain cases where it may be difficult to determine whether a trading venue authorisation is required, given the various interpretations the trading venue perimeter is currently subject to.

ESMA is seeking views from stakeholders in the securities markets, in particular investment firms and market operators, on its analysis of what constitutes a multilateral system. The deadline for comments is 29 April 2022.