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June 19, 2013

Dazzling Derivatives Special – MiFID II (19.6.2013)

Dear all, This week marked a great leap forward for the finalisation and subsequent agreement on MiFID II [summary here] leading to an updated MiFIR [background here]. The Council of the EU has finally agreed a common approach on MiFID II/MiFIR after 18 months of negotiations, and this two weeks before Ireland hands the Council presidency over to Lithuania. The trialogue process – European Commission vs European Parliament vs Council versions – can now get going in earnest. The pressure will be on to reach agreement on a Level 1 text by early 2014 at the latest so as to avoid running into the European parliamentary elections which were recently brought forward from June to May next year. Perhaps early negotiations throughout the summer should be the order of the day. Below are a number of articles on the subject. The latest revisions of the Council's compromise texts on MiFID and MiFIR can be found here (directive) [PDF] and here (regulation). [PDF] Tom R. Editors note: The EU debates and agrees a Directive first, being a political text, this Directive is then translating into a Regulation by other bodies such as ESMA. Hence once the Directive is agreed, and all the politics complete, turning that into a Regulation is a more mechanical process, where the Directive is interpreted into a set of rules for implementation by affected parties. EU regulators poised for battle on Mifid II The Council of the European Union has agreed its final draft of the long-awaited revised Markets in Financial Instruments Directive, bringing key rules for markets and trading one step closer to reality http://www.efinancialnews.com/story/2013-06-14/eu-regulators-poised-for-battle-on-mifid-reforms (subs required) Irish Presidency reaches breakthrough on new proposals for safer and more open financial markets The Irish Presidency has today reached a breakthrough among member states on new rules to make financial markets more efficient, resilient and transparent, and to strengthen the protection of investors. http://www.eu2013.ie/news/news-items/20130617mifidagreementpr/ EU states face showdown over markets overhaul * EU presidency to put 10th MiFID compromise to states * Compromise covers clearing houses, trading venues * Compromise proposes cap on dark trading in EU http://www.reuters.com/article/2013/06/10/eu-mifid-idUSL5N0EM1XP20130610 Update on MIFID II Nearly two years after it was first proposed, MIFID II remains stalled. http://regulatoryreform.wordpress.com/2013/06/13/update-on-mifid-ii/ EU Seeks to Resolve U.K.-Germany Split on Derivatives Clearing European Union nations will seek a deal on how far exchanges such as Germany’s Deutsche Boerse AG (DB1) should be forced to open up their derivatives-clearing services to competition as part of an overhaul of the bloc’s financial market rules. http://www.bloomberg.com/news/2013-06-10/eu-seeks-to-resolve-u-k-germany-split-on-derivatives-clearing.html EU Nations Edge Toward Deal on Overhauling Trading Rulebook European Union nations may clinch a deal by the end of this month to overhaul the bloc’s financial markets rules, said a spokeswoman for Ireland, which holds the rotating presidency of the bloc. http://www.bloomberg.com/news/2013-06-12/eu-nations-edge-toward-deal-on-overhauling-trading-rulebook.html EU Nations Broker Provisional Deal to Overhaul Markets Rulebook European Union nations reached a provisional deal on a sweeping overhaul of the bloc’s financial market rulebook that would toughen oversight of high-frequency trading and push more transactions onto regulated platforms. http://www.bloomberg.com/news/2013-06-13/eu-nations-broker-provisional-deal-to-overhaul-markets-rulebook.html EU states in deal on market rules: EU official (Reuters) – European Union states struck a deal on Thursday to overhaul the bloc's stock, bond, derivatives and commodities markets, an EU official said, ending a near two-year deadlock. http://in.reuters.com/article/2013/06/13/us-eu-markets-idINBRE95C0OS20130613 European regulator threatens derivatives reporting delay Under-resourced regulators and industry resistance could push key European derivatives reporting rules well into 2014, further delaying Europe’s implementation of G20 reforms that will reshape the swaps market. http://www.efinancialnews.com/story/2013-06-11/european-swaps-reporting-deadline-facing-further-delays (subs required) MiFID II takes a leap forward Hurrah! Looks like the Council of the EU has finally agreed a common approach on MiFID II/MiFIR after 18 months of negotiations. Subject to EU formalities next week, yesterday’s agreement comes just two weeks before Ireland hands the Council presidency on to Lithuania. http://regulation.fidessa.com/2013/06/14/mifid-ii-takes-a-leap-forward/ Where’s my TV remote? The recently proposed cap on European dark trading has caused quite a stir. It also illustrates how MiFID II policy-making has descended into almost Eurovision song contest levels of farce. http://fragmentation.fidessa.com/2013/06/13/wheres-my-tv-remote/ MiFIR: All Systems Go! European regulators continue to tweak MiFIR, but the final requirements are near. And dark pools are still under fire. http://tabbforum.com/opinions/mifir-all-systems-go EU agrees on tighter oversight of 'dark pools' European Union states reached a tentative deal Monday to tighten regulation of derivatives markets that sets finance ministers on a collision course with the European Parliament, opening the prospect of months of haggling over a compromise deal. http://www.efinancialnews.com/story/2013-06-18/eu-mifid-2-dark-pools (subs required) Agreement Reached Over MiFID II On 17 June 2013, the EU Council published a press release confirming that the Permanent Representatives Committee (COREPER), on behalf of the Council, has agreed a position with respect to MiFID II. http://regulatoryreform.wordpress.com/2013/06/18/agreement-reached-over-mifid-ii/


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