EUROPEAN UNION: ESMA proposals on non-equity transparency under MiFID II to be revised

Tuesday March 22 2016

The European Commission has asked the European Securities and Markets Authority (ESMA) to revise the ESMA proposals, published in September 2015, relating to non-equity price transparency. This follows concern in the banking and funds sectors regarding the impact of the proposals on trading activity and overall market liquidity.

ESMA had proposed to increase pre and post-trade transparency requirements for bonds and swaps as part of the work to implement the second Markets in Financial Instruments Directive (MiFID II) that was approved last year. Under the proposals asset managers and trading banks would have been forced to disclose the prices at which they were willing to buy and sell liquid bond instruments ahead of their sale.

The implementation date for MiFID II was originally proposed for January 2017, but has since been delayed until January 2018 as the industry is not sufficiently prepared. This new development could lead to calls for a further delay.

ESMA has indicated that it will begin work on the requested amendments immediately.

Click on the above link for ESMA’s response to the European Commission’s request.