Rely on the most comprehensive, up-to-date legal content designed and curated by lawyers for lawyers
Work faster and smarter to improve your drafting productivity without increasing risk
Accelerate the creation and use of high quality and trusted legal documents and forms
Streamline how you manage your legal business with proven tools and processes
Manage risk and compliance in your organisation to reduce your risk profile
Stay up to date and informed with insights from our trusted experts, news and information sources
Access the best content in the industry, effortlessly — confident that your news is trustworthy and up to date.
Find up-to-date guidance on points of law and then easily pull up sources to support your advice with Lexis PSL
Check out our straightforward definitions of common legal terms.
Our trusted tax intelligence solutions, highly-regarded exam training and education materials help guide and tutor Tax professionals
Access our unrivalled global news content, business information and analytics solutions
Insurance, risk and compliance intelligence using big data, proprietary linking and advanced analytics.
A leading provider of software platforms for professional services firms
In-depth analysis, commentary and practical information to help you protect your business
LexisNexis Blogs shed light on topics affecting the legal profession and the issues you're facing
Legal professionals trust us to help navigate change. Find out how we help ensure they exceed expectations
Lex Chat is a LexisNexis current affairs podcast sharing insights on topics for the legal profession
Discuss the latest legal developments, ask questions, and share best practice with other LexisPSL subscribers
Financial Services analysis: Following the adoption of a number of delegated Acts containing implementing and regulatory technical standards, Simon Lovegrove, head of financial services knowledge global at Norton Rose Fulbright, examines the key provisions which will impact on the way UK financial institutions organise their business.
While the revised Markets in Financial Instruments Directive 2014/65/EU (MiFID II) and the Markets in Financial Instruments Regulation (EU) 600/2014 (MiFIR) have been delayed by a year and won’t come into effect until 3 January 2018, the first half of 2016 has been a particularly busy period with the Commission adopting a number of delegated Acts that contain regulatory technical standards and implementing technical standards that add further detail to the framework Directive and Regulation. Indeed, many firms have found it difficult keeping pace with the volume of paper being published, so in June 2016 the European Securities and Markets Authority (ESMA) helpfully published a table setting out the status of each technical standard.
On 18 May 2016, the Commission adopted a Delegated Regulation supplementing MiFIR with regard to definitions, transparency, portfolio compression and supervisory measures on product intervention and positions. An accompanying annex was also published.
Chapter 1 of the Delegated Regulation of 18 May 2016 (arts 1–5) contains criteria in relation to the determination of a liquid market for shares, depositary receipts, exchange traded funds and certificates.
The criteria are based on specified amounts of free float, average daily number of transactions and average daily turnover, taking into account the specifics of each instrument. Importantly, each criterion has to be satisfied. For each instrument, guidance is given on how Member State competent authorities (NCAs) should make their calculations, and what to do where fewer than five instruments are considered to have liquid markets.
The Delegated Regulation also sets out (art 5) when NCAs of the most relevant market should assess liquidity and in summary these are:
It also covers the provision of information by trading venues (see also the annex) and the way in which relevant information must be used.
Chapter 2 of the Delegated Regulation of 18 May 2016 (arts 6–11) contains specifications for the purposes of specifying the obligation of trading venues and systematic internalisers to provide market data on a reasonable commercial basis, which is part of the transparency framework under MiFIR.
These specifications concern the requirement that fees are set on the basis of cost and may include a reasonable margin, non-discriminatory provision of market data, the obligation to unbundle and disaggregate data and a transparency to the public obligation around the fees as well as cost accounting methodologies.
The Delegated Regulation of 25 April 2016 as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of the Directive contains similar provisions for reporting services providers to provide market data on a reasonable commercial basis (see above).
‘The product intervention powers contained in this Delegated Regulation are a big milestone for consumer protection. European supervisory authorities will be equipped with a new and powerful toolkit allowing them to intervene in case financial instruments turn out to be harmful for investors or financial markets at large.’ (The European Parliament’s Rapporteur for MiFID II, Markus Ferber, MEP).
Chapter 5 of the Delegated Regulation of 18 May 2016 (arts 19–21) sets out the criteria and factors to be taken into account by ESMA, the EBA and NCAs when intending to use their product intervention powers. It is worth noting that the Delegated Regulation (recital 19) mentions that the need to assess all criteria and factors that could be present in a specific factual situation should not prevent NCAs, ESMA and the EBA from using a temporary intervention power when only one of the factors or criteria leads to such a concern or threat.
The long list of criteria includes:
Article 22 of the Delegated Regulation covers the position management powers of ESMA and sets out a list of the criteria and factors for determining the existence of a threat to the orderly functioning and integrity of financial markets. Such factors include the existence of serious financial, monetary or budgetary problems which could lead to the financial instability of a Member State or a financial institution deemed important to the global financial system.
Interviewed by Susan Ghaiwal.
The views expressed by our Legal Analysis interviewees are not necessarily those of the proprietor.
Free trials are only available to individuals based in the UK
* denotes a required field
0330 161 1234