The Approved Reporting Mechanism (ARM) approach used for Transaction Reporting in the UK has been unique across Europe.  While MiFID I required investment firms to report equity transactions to regulators, the regulators themselves decided not to define a standard that firms should use for their reports.  The additional workload that resulted for regulators as a result of this non-standardisation very quickly led to the creation of the ARM regime, where investment firms report to ARMs and the ARMS pass these reports on to the regulator.  ARMs also have to pay the regulator £100,000 in order to provide this service to investment firms.

The ARM regime is now part of MiFID II/MiFIR, and will come into force across the EEA in January 2017.  ESMA has recommended in its final Technical Specifications that transaction reports should be delivered by ARMs to regulators using a standardised protocol that the regulators will create themselves.  Regulators will use the ISO 20022 methodology to create this new standard protocol.

This leaves a question for investment firms across the EEA: how do they want to deliver their transaction reports to ARMs?  Do they want to implement new systems to use the ESMA protocol that the ARMs themselves must use, or do they want to use a protocol that they already use as part of their everyday business operations - such as the FIX Protocol?

Each approach has its own advantages and drawbacks, which may vary from one investment firm to another.  The decision is also relevant to service providers that are already registered as ARMs or that intend to do so.

The FIX Trading Community has today initiated a survey to ask investment firms (buy side as well as sell side) and ARMs for their feedback on this question.  You can access the survey by visiting:http://app.keysurvey.com/f/987711/518b/