Equiduct, the retail-focused pan-European regulated market launched by Börse Berlin in 2009, has received a clear bill of health from European regulator the European Securities and Markets Authority (ESMA), following an investigation arising from an application by a rival trading platform.
Under MiFID, trading venue operators are able to approach national regulators for a waiver allowing to forego the publication of pre-trade quotes. The rejection of one such application last year prompted an ESMA investigation into Equiduct’s own business. Now, ESMA has stated its final position on the compliance of Equiduct with MiFID.
“In ESMA’s opinion that trading system complies with the requirements for hybrid systems under Article 17(5) of the MiFID implementing regulation…In other terms, the system is considered pre-trade transparent and MiFID compliant,” stated the ESMA document.
The verdict means that Equiduct is an approved pan-European trading venue under German law to be recognised by all EU member states’ national financial supervisory authorities.
Market observers have said that Equiduct, which was previously questioned by competitors for its legal basis, will now be well placed to take advantage of the ESMA verdict in its favour.
Equiduct is currently majority-owned by Citadel Securities. The company’s business model is based on displaying the best bid and offer price available across multiple European trading venues. Equiduct is registered as a regulated market under MiFID.