On 6 February 2020, the European Securities and Markets Authority (ESMA) published a statement providing an update on the progress made on implementing its supervisory briefing on pre-trade transparency in commodity derivatives under MiFIR, which was published in June 2019.
In the statement, ESMA explains that all Member State national competent authorities (NCAs), except for the UK’s FCA in respect of two trading venues, had completed the preparation phase of the action plan annexed to the supervisory briefing, by the April 2019 deadline. The first stage of the action plan was to identify trading venues operating non-compliant trading systems and require them to provide information on the measures they intended to undertake to comply with the MiFIR pre-trade transparency obligations.
As regards stage two of the action plan, all NCAs, with the exception of the FCA, completed the implementation phase of the supervisory briefing. NCAs were required to ensure that all trading venues identified in stage 1 would either operate under a compliant pre-trade waiver or be fully pre-trade transparent by 31 December 2019.
The final stage of the action plan commenced on 1 January 2020 and will involve NCAs levying fines and sanctions on those trading venues that have either not provided or successfully implemented their plans as set out in stage 2 by 31 December 2019. At this moment in time, this stage is relevant only to those trading venues under the supervision of the FCA.
ESMA encourages the FCA to employ timely and proportionate supervisory measures to ensure compliance with the MiFIR transparency obligations.