The European Securities and Markets Authority (ESMA) is seeking feedback on technical issues surrounding post-trade transparency.
The authority’s upcoming consultation paper will focus on new Level 3 guidance, including issues related to the consistency and usability of information published.
It will also develop a method for reporting to ESMA Financial Instruments Reference Data System – (FITRS) for the performance of the transparency calculations.
The manual will provide a general overview of the post-trade transparency regime for equity, equity-like and non-equity instruments.
The document will contain guidance on Level 1 – Mifir / Mifid II – references as well as on Level 2, namely Regulatory Technical Standards (RTS) 1 and 2.
The European Commission adopted RTS 1 and 2 on 17 January. The objective of the reviewed standards was to clarify and improve the pre- and post-trade transparency regime for equity and non-equity instruments, in particular, given the establishment of a consolidated tape.
Esma published a positive opinion on the regulatory technical standards at the end of 2022, but it has opened the consultation to further foster the quality of post-trade transparency ahead of the setting up of a consolidated tape provider.
The availability of a real-time consolidated tape in Europe is critical for the success of the Capital Markets Union (CMU), the European Fund and Asset Management Association said in November.
But to best take advantage of a consolidated tape, rising data costs must be addressed through tighter regulation, according to several European financial associations.
The letter, penned by the German investment fund association (the BVI) alongside the Nordic Securities Association, repeated calls for increased transparency and the consolidation of the price formation process alongside regular compliance reviews and additional actions in case of non-compliance.
Esma has invited parties to send their feedback by 31 March 2023.
The final report and the manual will be published following both the consultation period and the end of the EU Council and Parliament’s 3-month scrutiny period for the reviewed RTS 1 and 2.
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