ESMA provides update on assessment of third-country trading venues for the purpose of post-trade transparency and position limits

On 20 December 2018, the European Securities and Markets Authority (ESMA) provided an update on its assessment of third-country trading venues (TCTVs) for the purpose of post-trade transparency and position limits under MiFID II/MIFIR.

Following the publication of two opinions for post trade transparency and position limits, ESMA received requests to assess more than 200 TCTVs against the criteria set out in these opinions. ESMA, to date, has not reviewed a sufficient number of TCTVs to publish a comprehensive list. ESMA considers it important that all TCTVs receive the same treatment

in order to maintain a level playing field, so will delay publication of the lists until a more significant number of TCTVs have been assessed.

Consequently, pending the publication of the lists, investment firms do not have to make public their transactions concluded on TCTVs via an approved publication arrangement (APA).  Commodity derivatives contracts traded on TCTVs are not considered as economically equivalent over-the-counter (EEOTC) contracts for the purpose of the position limit regime.

Background

In 2017 ESMA published two opinions on TCTVs in the context of MiFID II/MiFIR clarifying that:

• investment firms trading instruments within the scope of MiFID II on TCTVs meeting a set of criteria are not required to make transactions public in the EU via an APA; and
• commodity derivatives contracts traded on TCTVs meeting a set of criteria are not considered as EEOTC contracts for the purpose of the position limit regime.