Two papers, outlining draft rules for MiFID II, have been published by the European Securities and Markets Authority (ESMA) today.
A consultation paper with provides MiFID/MiFIR technical advice is intended to advise the European Commission on any technical barriers to the political agreement reached on MiFID II in January this year.
A separate discussion paper on regulatory technical standards has also been issued, which will provide a basis for a further consultation paper with draft rules to be published in later 2014 or early 2015.
ESMA’s main proposals are enhancing pre- and post-trade transparency for a broad range of instruments, defining high-frequency trading, setting rules on algorithmic trading and direct access and creating a consolidated tape.
It also includes rules governing commodity derivatives and trading venues and various investor protection measures.
Steven Maijoor, chair of ESMA, said: “The launch of today’s MiFID II/MiFIR consultation process is an important step in the biggest overhaul of financial markets regulation in the EU for a decade. The reform of MiFID is an integral part of the EU’s strategy to address the effects of the financial crisis and aims to bring greater transparency to markets and to strengthen investor protection. These changes are key to restoring trust in our financial markets.”
In addition to the published papers, ESMA will hold three public hearings covering secondary markets, investor protection and commodity derivatives on 7 and 8 July. Responses for both papers are due on 1 August.