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MiFID II ESMA transaction reporting guidelines update
10/08/2017
MiFID II ESMA transaction reporting guidelines update

The European Securities and Markets Authority (ESMA) has issued its final MiFID II ESMA transaction reporting guidelines. What do you need to know?

10 August, AtoZForex The European Securities and Markets Authority (ESMA) is the key financial regulator of European financial markets. The watchdog has issued the final Guidelines in regards to the implementation of the transaction reporting regime under the Markets in Financial Instruments Directive (MiFID II) and Regulation (MiFIR).

MiFID II ESMA transaction reporting guidelines update

Along with the MiFID II ESMA transaction reporting guidelines, the authority has also published the Final Report. The latter sets out the feedback ESMA has obtained via its consultation on these topics.

Specifically, MiFID II ESMA transaction reporting guidelines provide more detail on the process of implementing the transaction reporting. The guidelines also outline the principles on how to implement order record keeping and clock synchronization requirements.

It is worth to note that the regulatory technical standard (RTS) on the reporting of the transaction to competent authorities is still under the analysis of the European Parliament and Council. That is why this ESMA publication does not include the prejudice to their possible objection to that RTS.

Purpose of MiFID II ESMA transaction reporting guidelines

The key purpose of these MiFID II ESMA transaction reporting guidelines is to provide guidance to investment firms, trading venues and approved reporting mechanisms (ARMs). The regulator aims to guide these entities in order to keep them ready for the compliance with their reporting and order record obligations.

In fact, firms need to be ready in advance prior to the MiFID II rules entry-into –force date. Markets expect the new regulatory framework to get into effect in the beginning of 2018.

In addition, the guidelines strive to assure the consistency in the application of these frameworks across the EU bloc. To be more precise, they provide specific examples of transaction reports and of the order data records. The regulator also provided samples of xml-messages along with these examples.

What do MiFID II ESMA transaction reporting guidelines include?

The MiFID II ESMA transaction reporting guidelines comprise the following points:

  1. General methods to apply to transaction reporting and order record keeping.
  2. Reporting and record keeping examples for numerous trading scenarios that can happen.
  3. Reporting specific financial instruments
  4. Clock synchronization clarifications

The MiFID II ESMA transaction reporting guidelines are valid for national competent authorities (NCAs) and financial market participants. These groups need to make every effort to comply with the requirements, according to ESMA.

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