If Markus Ferber’s ears were burning last week, no one who attended TradeTech Europe 2012 would have been surprised. The German MEP – who is pushing MiFID and MiFIR through Brussels with seemingly less and less patience for the industry – was public enemy number one at London’s ExCel convention centre.
The amount of people both on stage and off – including the Financial Services Authority – who suggested that Brussels was forming policy in an “information vacuum”, was truly astonishing.
Brussels-bashing has become a national sport in the securities trading world. After several rounds of consultation, the draft text for MiFID II released by the European Commission in October, contained several proposals that the industry considered totally unworkable, leading many to wonder whether their comments had entirely fallen on deaf ears.
As the rule-making process continues, it is now the European Parliament’s turn to engage with market participants, many of whom regard Ferber’s proposals as detached from the lens through which they view the markets and the reality they perceive.
For one, Ferber seems determined to outlaw broker crossing networks and reduce OTC trading as much as possible. He has proposed an amendment to MiFIR that shoehorns all OTC equity trading into existing regulated venues.
He also continues to take a hard line on high-frequency trading.
Discontent between rule-makers and industry is as far from being resolved as ever and the buy-side feels they are not being listened to at all.
Although, one senior-ranking trader I spoke to at TradeTech said he didn’t blame MEPs for being sick of the industry as the sheer weight of lobbying must be weighing them down.
From what is coming out of Brussels, you would be hard pressed believing the buy-side was not now tarred with the same brush as the banks that were at fault for the financial crisis.
The refrain from TradeTech’s speakers and delegates was a frustration at the ‘politicisation’ of the regulatory reform process. When one considers the relatively harmonious progress of securities and derivatives reforms in Australia and Singapore for example – notably two markets less badly-hit by the global financial crisis – it is hard not to disagree.