23 March 2018
Jeffrey Anderson

Regulatory Matters

Jeffrey Anderson - Fidessa

5Posts 20,152Views 0Comments


A place to discuss MiFID

Clarity through the DEA tiers

20 November 2017  |  2304 views  |  0

An ESMA Q&A published this week provides some further guidance regarding the authorization of sub-delegated DEA providers, but it still leaves room for uncertainty. The Q&A draws a distinction between a DEA client that has EU exchange access directly via a member (Tier 1 DEA client), and a DEA client that obtains access through a sub-delegated DEA provider (Tier 2 DEA client). ESMA argues that Tier 2 clients do not have DEA access because in most cases they are not technically in possession of the trading code of the exchange member.

 Furthermore, the Q&A reiterates the Article 48(7) requirement that in order to provide DEA access, a member of an EU exchange must be a registered MiFID II firm or credit institution. However, it is not absolutely clear whether the authorization requirement includes sub-delegated DEA providers. If you analyze the question by reference to the above-mentioned client tiers a sub-delegated DEA provider's clients are Tier 2 and don't have DEA.

Logically it follows that if the clients don't have DEA, how can a sub-delegated firm be providing DEA? So much for clarification! With a short amount of time until implementation, further guidance on the issue seems unlikely. Therefore, we must look to answer the question on the authorization of sub-delegated DEA providers by a review of the client tiers

TagsRisk & regulation

Comments: (0)

Comment on this story (membership required)

Latest posts from Jeffrey

ESMA’s third-country venues - the naughty or nice list

22 December 2017  |  5092 views  |  0 comments | recomends Recommends 0 TagsRisk & regulation

Clarity through the DEA tiers

20 November 2017  |  2304 views  |  0 comments | recomends Recommends 0 TagsRisk & regulationGroupMiFID

A position of responsibility

27 September 2017  |  3528 views  |  0 comments | recomends Recommends 0 TagsRisk & regulationPost-trade & ops

Sometimes it's tough being average

21 June 2017  |  4683 views  |  0 comments | recomends Recommends 0 TagsRisk & regulationPost-trade & ops

Is the regulatory WORM turning?

31 March 2017  |  4546 views  |  0 comments | recomends Recommends 0

Jeffrey's profile

job title Derivatives Compliance Product Manager
location Chicago
member since 2017
Summary profile See full profile »
I am a Derivatives Compliance Product Manager at Fidessa and focus on the regulatory requirements for multi-asset trading systems.

Jeffrey's expertise

Member since 2017
5 posts0 comments
What Jeffrey reads
Jeffrey writes about
Risk & regulationPost-trade & ops
Jeffrey's blog archive
2017 (5)

Who's commenting on Jeffrey's posts