28 May 2018
Visit www.fingerprints.com

Europe braces for MiFID II as regulators assess market impact

10 June 2009  |  12080 views  |  0 mifid

The Committee of European Securities Regulators says further regulations may be needed to address some of the unintended consequences arising from the introduction of the Markets in Financial Instruments Directive (MiFID) in 2007.

In a report which assesses the impact of MiFID on the functioning of equity secondary markets, CESR says the introduction of the Directive has thrown up a new set of challenges relating to pre- and post-trade transparency, liquidity and data fragmentation, and competition between new entrants and incumbent exchanges.

CESR notes that while the increased competition between trading venues has resulted in downward pressures on direct execution costs, this reduction in prices has been largely offset by increased spending on technology to cope with market fragmentation and a general widening of bid-offer spreads as a result of volatile market conditions. The findings also indicate concerns by some market participants that fee reductions by trading platforms have not been passed on entirely by trading participants to investors.

Market participants have also expressed concerns over a number of pre-trade transparency issues ranging from interpretation issues, to potentially undesirable impacts on innovation and an unlevel playing field between various trade execution venues. CESR has also noted industry concerns about the fragmentation of market data and the need for better quality of post-trade data and a consolidated set of market data.

Introducing the report, Jean-Paul Servais, chair of the Belgian Commission Bancaire, Financière et des Assurances (CBFA), states: "Despite the difficult market conditions of the past 19 months, MiFID has created a new dynamism and increased competition into equity secondary markets. The changes will certainly continue, and CESR stands ready to further analyse these changes and find solutions to any challenges arising."

He adds that CESR has already started preparing a similar report on MiFID's impact on the over-the-counter markets, which is expected to be finalised during the first quarter of 2010.

This is likely to lead to further upheavals, as Europe follows the US lead in enforcing more transparency in the OTC arena.

Read the full CESR report:» Download the document now 563.5 kb (PDF File)

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Deutsche Börse plans pan-European market

Deutsche Börse plans pan-European market

16 April 2009  |  8043 views  |  0 comments
CESR finds huge variation in fines for MiFID non-compliance

CESR finds huge variation in fines for MiFID non-compliance

17 February 2009  |  8475 views  |  0 comments
Thomson Reuters launches consolidated tape

Thomson Reuters launches consolidated tape

19 January 2009  |  10028 views  |  0 comments
Instinet execution data shows 'MTF effect' on European share trading

Instinet execution data shows 'MTF effect' on European share trading

10 December 2008  |  10225 views  |  0 comments
Markit releases MiFID fragmentation analysis

Markit releases MiFID fragmentation analysis

04 December 2008  |  10378 views  |  0 comments
More upstart exchanges set to enter crowded post-MiFID market

More upstart exchanges set to enter crowded post-MiFID market

21 August 2008  |  10948 views  |  0 comments
Apcims challenges FSA on data security and MiFID

Apcims challenges FSA on data security and MiFID

24 July 2008  |  7561 views  |  0 comments
Smart routing vital to success in post-MiFID market

Smart routing vital to success in post-MiFID market

09 June 2008  |  5583 views  |  0 comments
Domestic exchanges squeezed as post-MiFID fragmentation hits - Reuters

Domestic exchanges squeezed as post-MiFID fragmentation hits - Reuters

25 February 2008  |  8322 views  |  0 comments
EU to prosecute MiFID laggards

EU to prosecute MiFID laggards

01 February 2008  |  6858 views  |  0 comments
MTFs to take 20% of European trading volume  - Aite Group

MTFs to take 20% of European trading volume - Aite Group

14 November 2007  |  5666 views  |  0 comments
MiFID uncertainty haunts capital markets firms

MiFID uncertainty haunts capital markets firms

24 October 2007  |  6658 views  |  0 comments
Reuters introduces new MiFID instrument code

Reuters introduces new MiFID instrument code

22 October 2007  |  8171 views  |  0 comments

Related blogs

Create a blog about this story (membership required)
Visit http://go.jumio.com/finextraAdVisit response.ncr.com

Who is commenting?

Top topics

Most viewed Most shared
satelliteAnt Financial provides tech for China Ever...
37076 views comments | 3 tweets | 2 linkedin
Digital banking transformation creating new systemic risksDigital banking transformation creating ne...
9353 views comments | 18 tweets | 26 linkedin
ING opens developer portalING opens developer portal
7967 views comments | 18 tweets | 23 linkedin
MUFG to roll out blockchain payment network next yearMUFG to roll out blockchain payment networ...
7942 views comments | 13 tweets | 13 linkedin
PayPal and Google bind payment railsPayPal and Google bind payment rails
7620 views comments | 11 tweets | 17 linkedin

Featured job

to $120K base, 200K ote, benefits
New York City, NY - USA

Find your next job