On 10 March 2020, the European Securities and Markets Authority (ESMA) issued a consultation paper reviewing the transparency regime for non-equity instruments and the trading obligation for derivatives under the Market in Financial Instruments Regulation (MiFIR).

The first part of the consultation paper focuses on the Level 1 review required under Article 52(1) and (6) of MiFIR. In particular, section 3.1 of the final report focuses on the pre-trade transparency requirements including an assessment of the current level of pre-trade transparency available and how trading has evolved throughout the first period of application of MiFID II / MiFIR. Section 3.2 focuses on post trade requirements for non-equity instruments. Section 3.3 analyses the trading obligation for derivatives.

The second part of the consultation paper focuses on the Level 2 review required under Article 17(4) to (9) of Commission Delegated Regulation (EU) 2017/583 of 14 July 2016 supplementing MiFIR with regard to regulatory technical standards on transparency requirements for trading venues and investment firms in respect of bonds, structured finance products, emission allowances and derivatives. It also covers the review for commodity derivatives.

The deadline for comments on the consultation paper is 19 April 2020.

ESMA will consider the feedback it receives to the consultation paper in Q2 2020 and expects to publish a final report and submit, if necessary, draft technical standards to the European Commission for endorsement in July 2020.