The FCA has published a statement responding to the announcement by the European Securities and Markets Authority (ESMA) that an updated work plan has been agreed for the opinions on pre-trade transparency waivers and position limits that the European Supervisory Authority is required to issue under MiFID II and MiFIR.
The FCA notes:
- in relation to equity waiver applications, the plan remains that the FCA will communicate decisions after ESMA has finalised its opinion;
- in relation to non-equity waiver applications, the FCA will communicate responses before ESMA finalises its opinion. Any waiver the FCA communicates will take effect from 3 January 2018, and applicants should prepare on this basis. However, waivers may be subject to review once ESMA has issued its opinion. Where the FCA decides to amend its response in light of ESMA’s opinion, it will contact the affected applicant to discuss with them the period of time that would be reasonably practicable for them to adapt their rules, systems and processes in order to comply before the FCA takes a final decision; and
- in relation to commodity position limits, the FCA intends to start publishing in October 2017, position limits that will come into effect on 3 January 2018 on commodity derivatives contracts traded on UK trading venues. In the event the FCA decides it is necessary to change the limits in the light of ESMA’s opinions, or as otherwise required under MIFID II, the FCA will provide an appropriate notice period before the revised limit replaces the initial limit to allow market participants to adjust positions and, if eligible, apply for a hedging exemption.