On 24 September 2020, the European Securities and Markets Authority (ESMA) launched a public consultation on the functioning of the MiFIR obligation to report transactions and reference data. The following day, on 25 September 2020, ESMA launched another public consultation from the MiFID II / MiFIR review series, this time focussing on the functioning of the Organised Trading Facilities (OTF) regime.
The transaction reporting consultation paper is divided into 10 substantive sections and covers: (1) Entities subject to transaction reporting and arrangements to share reports, (2) Scope of instruments subject to reporting obligations, (3) Details to be reported: trading venue transaction identification, chain of transactions, (4) Details to be reported: the identifiers to be used by parties, (5) Details to be reported: a designation to identify computer algorithms and a short sale, (6) Details to be reported: indicators for waivers, over-the-counter (OTC) post-trade deferrals, commodity derivatives, buy-back programmes, (7) Obligations for investment firms transmitting orders, (8) Entities entitled to provide transaction reports to Member State national competent authorities, (9) Interaction with the reporting obligation under EMIR and (10) Legal entity identifier of the issuer of the financial instrument.
The OFT consultation paper consists of three substantive chapters and covers: (1) Overview of OTF trading (current state of play for bonds and derivatives), (2) OTF definition and trading venue boundaries (including legal framework, analysis of multilateral systems in the context of, among other, software providers and SI networks, and use of discretion) and (3) Matched principal trading (use of matched principal trading by an OTF, restrictions to matched principal trading on regulated markets and multilateral trading facilities).
The deadline for comments on the transaction reporting consultation is 20 November 2020, and the deadline for comments on the OFT consultation is 25 November 2020. Based on the feedback received, ESMA will develop reports for the Commission, which it intends to submit in Q1 2021.