Commission ECON Committee on Economic and Monetary Affairs</ Commission

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Commission ECON Committee on Economic and Monetary Affairs</ Commission

EUROPEAN PARLIAMENT 2009 - 2014

Committee on Economic and Monetary Affairs

2011/0296(COD)

27.3.2012

***I DRAFT REPORT

on the proposal for a regulation of the European Parliament and of the Council on markets in financial instruments and amending Regulation [EMIR] on OTC derivatives, central counterparties and trade repositories (COM(2011)0652 – C7-0359/2011 – 2011/0296(COD))

Committee on Economic and Monetary Affairs

Rapporteur: Markus Ferber

PR\895737EN.doc PE485.888v01-00

EN United in diversity EN PR_COD_1amCom

Symbols for procedures

* Consultation procedure *** Consent procedure ***I Ordinary legislative procedure (first reading) ***II Ordinary legislative procedure (second reading) ***III Ordinary legislative procedure (third reading)

(The type of procedure depends on the legal basis proposed by the draft act.)

Amendments to a draft act

In amendments by Parliament, amendments to draft acts are highlighted in bold italics. Highlighting in normal italics is an indication for the relevant departments showing parts of the draft act which may require correction when the final text is prepared – for instance, obvious errors or omissions in a language version. Suggested corrections of this kind are subject to the agreement of the departments concerned.

The heading for any amendment to an existing act that the draft act seeks to amend includes a third line identifying the existing act and a fourth line identifying the provision in that act that Parliament wishes to amend. Passages in an existing act that Parliament wishes to amend, but that the draft act has left unchanged, are highlighted in bold. Any deletions that Parliament wishes to make in such passages are indicated thus: [...].

PE485.888v01-00 2/51 PR\895737EN.doc EN CONTENTS

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DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION...... 5

EXPLANATORY STATEMENT...... 53

PR\895737EN.doc 3/51 PE485.888v01-00 EN PE485.888v01-00 4/51 PR\895737EN.doc EN DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION on the proposal for a regulation of the European Parliament and of the Council on markets in financial instruments and amending Regulation [EMIR] on OTC derivatives, central counterparties and trade repositories (COM(2011)0652 – C7-0359/2011 – 2011/0296(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2011)0652),

– having regard to Article 294(2) and Article 114 of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C7-0359/2011),

– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

– having regard to the opinion of the European Economic and Social Committee of 22 February 20121,

– having regard to Rule 55 of its Rules of Procedure,

– having regard to the report of the Committee on Economic and Monetary Affairs and the opinions of the Committee on Development and the Committee on Industry, Research and Energy (A7-0000/2012),

1. Adopts its position at first reading hereinafter set out;

2. Calls on the Commission to refer the matter to Parliament again if it intends to amend the proposal substantially or replace it with another text;

3. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

1 Not yet published in the Official Journal.

PR\895737EN.doc 5/51 PE485.888v01-00 EN Amendment 1 Proposal for a regulation Recital 7

Text proposed by the Commission Amendment

(7) In order to make European markets (7) In order to make European markets more transparent and to level the playing more transparent and to level the playing field between various venues offering field between various venues offering trading services it is necessary to introduce trading services it is necessary to introduce a new category of organised trading facility a new category of organised trading facility (OTF). This new category is broadly (OTF) for bonds, structured finance defined so that now and in the future it products, emissions allowances and should be able to capture all types of derivatives. This new category is broadly organised execution and arranging of defined so that now and in the future it trading which do not correspond to the should be able to capture all types of functionalities or regulatory specifications organised execution and arranging of of existing venues. Consequently trading which do not correspond to the appropriate organisational requirements functionalities or regulatory specifications and transparency rules which support of existing venues. Consequently efficient price discovery need to be appropriate organisational requirements applied. The new category includes broker and transparency rules which support crossing systems, which can be described efficient price discovery need to be as internal electronic matching systems applied. The new category includes broker operated by an investment firm which crossing systems, which can be described execute client orders against other client as internal electronic matching systems orders. The new category also operated by an investment firm which encompasses systems eligible for trading execute client orders against other client clearing-eligible and sufficiently liquid orders. The new category also derivatives. It shall not include facilities encompasses systems eligible for trading where there is no genuine trade execution clearing-eligible and sufficiently liquid or arranging taking place in the system, derivatives. It shall not include facilities such as bulletin boards used for advertising where there is no genuine trade execution buying and selling interests, other entities or arranging taking place in the system, aggregating or pooling potential buying or such as bulletin boards used for advertising selling interests, or electronic post-trade buying and selling interests, other entities confirmation services. aggregating or pooling potential buying or selling interests, or electronic post-trade confirmation services.

Or. en

Amendment 2 Proposal for a regulation Recital 12

PE485.888v01-00 6/51 PR\895737EN.doc EN Text proposed by the Commission Amendment

(12) The financial crisis exposed specific (12) The financial crisis exposed specific weaknesses in the way information on weaknesses in the way information on trading opportunities and prices in financial trading opportunities and prices in financial instruments other than shares is available instruments other than shares is available to market participants, namely in terms of to market participants, namely in terms of timing, granularity, equal access, and timing, granularity, equal access, and reliability. Pre- and post-trade transparency reliability. Pre- and post-trade transparency requirements taking account of the requirements taking account of the different characteristics and market different characteristics and market structures of specific types of instruments structures of specific types of instruments other than shares should thus be other than shares should thus be introduced. In order to provide a sound introduced. In order to provide a sound transparency framework for all relevant transparency framework for all relevant instruments, these should apply to bonds instruments, these should apply to bonds and structured finance products with a and structured finance products with a prospectus or which are admitted to trading prospectus or which are admitted to trading either on a regulated market or are traded either on a regulated market or are traded on a multilateral trading facility (MTF) or on a multilateral trading facility (MTF) or an organised trading facility (OTF), to an OTF, to derivatives which are traded or derivatives which are traded or admitted to admitted to trading on regulated markets, trading on regulated markets, MTFs and MTFs and OTFs or considered eligible for OTFs or considered eligible for central central clearing, as well as, in the case of clearing, as well as, in the case of post- post-trade transparency, to derivatives trade transparency, to derivatives reported reported to trade repositories. Therefore to trade repositories. Therefore only those only those financial instruments which are financial instruments traded purely OTC bespoke in their design would be outside which are deemed particularly illiquid or the scope of the transparency obligations. are bespoke in their design would be outside the scope of the transparency obligations.

Or. en

Amendment 3 Proposal for a regulation Recital 16

Text proposed by the Commission Amendment

(16) An investment firm executing client (16) An investment firm executing client orders against own proprietary capital orders against own proprietary capital should be deemed a systematic internaliser, should be deemed a systematic internaliser, unless the transactions are carried out unless the transactions are carried out outside regulated markets, MTFs and OTFs outside regulated markets, MTFs and OTFs on an occasional, ad hoc and irregular on an ad hoc and irregular basis. basis. Systematic internalisers should be Systematic internalisers should be defined

PR\895737EN.doc 7/51 PE485.888v01-00 EN defined as investment firms which, on an as investment firms which, on an organised organised, frequent and systematic basis, and systematic basis, deal on own account deal on own account by executing client by executing client orders outside a orders outside a regulated market, an MTF regulated market, an MTF or an OTF. In or an OTF. In order to ensure the objective order to ensure the objective and effective and effective application of this definition application of this definition to investment to investment firms, any bilateral trading firms, any bilateral trading carried out with carried out with clients should be relevant clients should be relevant and quantitative and quantitative criteria should criteria could complement the qualitative complement the qualitative criteria for the criteria for the identification of investment identification of investment firms required firms required to register as systematic to register as systematic internalisers, laid internalisers, laid down in Article 21 of down in Article 21 of Commission Commission Regulation No 1287/2006 Regulation No 1287/2006 implementing implementing Directive 2004/39/EC. Directive 2004/39/EC. While an OTF is While an OTF is any system or facility in any system or facility in which multiple which multiple third party buying and third party buying and selling interests selling interests interact in the system, a interact in the system, a systematic systematic internaliser should not be internaliser should not be allowed to bring allowed to bring together third party together third party buying and selling buying and selling interests. interests.

Or. en

Amendment 4 Proposal for a regulation Recital 18

Text proposed by the Commission Amendment

(18) It is not the intention of this (18) It is appropriate to ensure that as Regulation to require the application of much trading as possible which occurs pre-trade transparency rules to transactions outside regulated execution venues takes carried out on an OTC basis, the place in organised systems to which characteristics of which include that they appropriate transparency requirements are ad-hoc and irregular and are carried apply. It is not the intention of this out with wholesale counterparties and are Regulation to require the application of part of a business relationship which is pre-trade transparency rules to OTC itself characterised by dealings above transactions involving primary issuance, standard market size, and where the deals the characteristics of which include that are carried out outside the systems the instruments are bespoke and designed usually used by the firm concerned for its for the specific requirements of wholesale business as a systematic internaliser. financial or non-financial counterparties.

Or. en

PE485.888v01-00 8/51 PR\895737EN.doc EN Amendment 5 Proposal for a regulation Recital 23 a (new)

Text proposed by the Commission Amendment

(23a) ESMA should monitor the investment products, including structured deposits and financial instruments which are marketed, distributed or sold in the Union and should be able to investigate new investment products or financial instruments before they are marketed, distributed or sold in the Union, in cooperation with the competent authorities. ESMA should be empowered to prohibit temporarily or to restrict the marketing, distribution or sale in the Union of certain investment products or financial instruments, or a type of financial activity or practice, provided certain conditions specified in this Regulation are fulfilled. ESMA should also be able to impose such prohibitions or restrictions on a precautionary basis before an investment product or financial instrument has been marketed or sold to clients, provided certain conditions specified in this Regulation are fulfilled.

Or. en

Amendment 6 Proposal for a regulation Recital 24

Text proposed by the Commission Amendment

(24) Competent authorities' powers should (24) Competent authorities should be complemented with an explicit monitor investment products, including mechanism for prohibiting or restricting structured deposits, and financial the marketing, distribution and sale of any instruments which are marketed, financial instrument giving rise to serious distributed or sold in or from the Member concerns regarding investor protection, State concerned. Competent authorities' orderly functioning and integrity of powers should be complemented with an financial markets, or the stability of the explicit mechanism for prohibiting or whole or part of the financial system, restricting the marketing, distribution and together with appropriate coordination and sale of any investment product or financial contingency powers for ESMA. The instrument giving rise to serious concerns

PR\895737EN.doc 9/51 PE485.888v01-00 EN exercise of such powers should be subject regarding investor protection, orderly to the need to fulfil a number of specific functioning and integrity of financial conditions. markets, or the stability of the whole or part of the financial system, together with appropriate coordination and contingency powers for ESMA. The exercise of such powers should be subject to the need to fulfil a number of specific conditions. Where those conditions are met, the competent authority should be able to impose a prohibition or restriction on a precautionary basis before an investment product or financial instrument has been marketed, distributed or sold to clients.

Or. en

Amendment 7

Proposal for a regulation Recital 33

Text proposed by the Commission Amendment

(33) Trading venues should also be (33) Trading venues should also be required to provide access including data required to provide access including data feeds on a transparent and non- feeds on a transparent and non- discriminatory basis to CCPs that wish to discriminatory basis to CCPs that wish to clear transactions executed on the trading clear transactions executed on the trading venue. Licensing and access to information venue. The right of access of a CCP to a about indices and other benchmarks that trading venue should allow for are used to determine the value of financial arrangements whereby multiple CCPs are instruments should also be provided to using trade feeds of the same trading CCPs and other trading venues on a non- venue. However, this should not lead to discriminatory basis. The removal of interoperability for derivatives clearing or barriers and discriminatory practices is create liquidity fragmentation. Licensing intended to increase competition for and access to information about indices clearing and trading of financial and other benchmarks that are used to instruments in order to lower investment determine the value of financial and borrowing costs, eliminate instruments should also be provided to inefficiencies and foster innovation in CCPs and other trading venues on a non- Union markets. The Commission should discriminatory basis. The removal of continue to closely monitor the evolution barriers and discriminatory practices is of post-trade infrastructure and should, intended to increase competition for where necessary, intervene in order to clearing and trading of financial prevent competitive distortions from instruments in order to lower investment occurring in the internal market. and borrowing costs, eliminate inefficiencies and foster innovation in Union markets. The Commission should

PE485.888v01-00 10/51 PR\895737EN.doc EN continue to closely monitor the evolution of post-trade infrastructure and should, where necessary, intervene in order to prevent competitive distortions from occurring in the internal market.

Or. en

Amendment 8 Proposal for a regulation Recital 38

Text proposed by the Commission Amendment

(38) The Commission should be (38) The power to adopt delegated acts in empowered to adopt delegated acts in accordance with Article 290 TFEU should accordance with Article 290 of the Treaty. be delegated to the Commission in respect In particular, the delegated acts should be of the specification of certain definitions; adopted in respect of specific details the precise characteristics of trade concerning definitions; the precise transparency requirements; detailed characteristics of trade transparency conditions for waivers from pre-trade requirements; detailed conditions for transparency; deferred post-trade waivers from pre-trade transparency; publication arrangements; criteria for the deferred post-trade publication application of the pre-trade transparency arrangements; criteria for the application of obligations for systematic internalisers, the pre-trade transparency obligations for specific cost-related provisions related to systematic internalisers, specific cost- the availability of market data; the criteria related provisions related to the availability for granting or refusing access between of market data; the criteria for granting or trading venues and CCPs; and the further refusing access between trading venues and determination of conditions under which CCPs; and the further determination of threats to investor protection, the orderly conditions under which threats to investor functioning and integrity of financial protection, the orderly functioning and markets, or the stability of the whole or integrity of financial markets, or the part of the financial system of the Union stability of the whole or part of the may warrant ESMA action. It is of financial system of the Union may warrant particular importance that the ESMA action. Commission carry out appropriate consultations during its preparatory work, including at expert level. The Commission, when preparing and drawing up delegated acts, should ensure a simultaneous, timely and appropriate transmission of relevant documents to the European Parliament and to the Council.

Or. en

PR\895737EN.doc 11/51 PE485.888v01-00 EN Amendment 9 Proposal for a regulation Recital 39

Text proposed by the Commission Amendment

(39) The implementing powers relating to (39) In order to ensure uniform the adoption of the equivalence decision conditions for the implementation of this concerning third country legal and Regulation, implementing powers should supervisory frameworks for the provision be conferred on the Commission. Those of services by third country firms should be powers should relate to the adoption of the exercised in accordance with Regulation equivalence decision concerning third (EU) No 182/2011 of the European country legal and supervisory frameworks Parliament and of the Council of 16 for the provision of services by third February 2011 laying down the rules and country firms and they should be exercised general principles concerning mechanisms in accordance with Regulation (EU) No for control by Member States of the 182/2011 of the European Parliament and Commission's exercise of implementing of the Council of 16 February 2011 laying powers. down the rules and general principles concerning mechanisms for control by Member States of the Commission's exercise of implementing powers.

Or. en

Amendment 10 Proposal for a regulation Recital 42

Text proposed by the Commission Amendment

(42) The Commission should adopt the (42) The Commission should adopt the draft regulatory technical standards draft regulatory technical standards developed by ESMA according to Article developed by ESMA according to Article 23 regarding the content and specifications 23 regarding the content and specifications of transaction reports, Article 26 regarding of transaction reports, specifying the types the liquidity criteria for derivatives to be of derivative contracts which have a considered subject to an obligation to trade direct, substantial and foreseeable effect on organised trading venues, and Article 36 within the Union, specifying whether a concerning the information that the class of derivatives declared subject to the applicant third country firm shall provide clearing obligation under Regulation to ESMA in its application for registration (EU) No …/... [EMIR] or a relevant by means of delegated acts pursuant to subset thereof should be traded only on Article 290 TFEU and in accordance with organised trading venues, Article 26 Articles 10 to 14 of Regulation (EU) No regarding the liquidity criteria for 1093/2010. derivatives to be considered subject to an obligation to trade on organised trading venues, and Article 36 concerning the information that the applicant third country

PE485.888v01-00 12/51 PR\895737EN.doc EN firm shall provide to ESMA in its application for registration. The Commission should adopt those draft regulatory technical standards by means of delegated acts pursuant to Article 290 TFEU and in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.

Or. en

Amendment 11 Proposal for a regulation Recital 43

Text proposed by the Commission Amendment

(43) The Commission should also be deleted empowered to adopt implementing technical standards by means of implementing acts pursuant to Article 291 TFEU and in accordance with Article 15 of Regulation (EU) No 1095/2010. ESMA should be entrusted with drafting implementing technical standards for submission to the Commission with regard to Article 26 specifying whether a class of derivatives declared subject to the clearing obligation under Regulation [ ] (EMIR) or a relevant subset thereof should only be traded on organised trading venues.

Or. en

Amendment 12 Proposal for a regulation Article 1 – paragraph 1 – point e

Text proposed by the Commission Amendment

(e) product intervention powers of (e) product intervention powers of competent authorities and ESMA and competent authorities and ESMA; powers of ESMA on position management and position limits;

Or. en

PR\895737EN.doc 13/51 PE485.888v01-00 EN Amendment 13 Proposal for a regulation Article 1 – paragraph 2

Text proposed by the Commission Amendment

2. This Regulation applies to investment 2. This Regulation applies to credit firms, credit institutions authorised under institutions and investment firms Directive [new MiFID] when providing authorised under Directive .../.../EU [new one or more investment services and/or MiFID] when the credit institution or performing investment activities and investment firm is providing one or more regulated markets. investment services and/or performing investment activities and to regulated markets.

Or. en

Amendment 14 Proposal for a regulation Article 2 – paragraph 1 – point 3

Text proposed by the Commission Amendment

(3) ‘systematic internaliser’ means an (3) ‘systematic internaliser’ means an investment firm which, on an organised, investment firm which, on an organised frequent and systematic basis, deals on and systematic basis, deals on own account own account by executing client orders by executing client orders outside a outside a regulated market or an MTF or an regulated market or an MTF or an OTF in OTF; a bilateral system;

Or. en

Amendment 15 Proposal for a regulation Article 2 – paragraph 1 – point 3 a (new)

Text proposed by the Commission Amendment

(3a) 'bilateral system' means a system that brings together or facilitates the bringing together of buying and selling interests in financial instruments whereby the investment firm operating the system deals on own account by executing client orders within the system;

Or. en

PE485.888v01-00 14/51 PR\895737EN.doc EN Amendment 16 Proposal for a regulation Article 2 – paragraph 1 – point 7

Text proposed by the Commission Amendment

(7) ‘organised trading facility (OTF)’ (7) ‘organised trading facility (OTF)’ means any system or facility, which is not means a multilateral system or facility, a regulated market or MTF, operated by an which is not a regulated market or MTF, investment firm or a market operator, in operated by an investment firm or a market which multiple third-party buying and operator, in which multiple third-party selling interests in financial instruments buying and selling interests in bonds, are able to interact in the system in a way structured finance products, emission that results in a contract in accordance with allowances or derivatives are able to the provisions of Title II of Directive [new interact in the system in a way that results MiFID]; in a contract in accordance with the provisions of Title II of Directive .../.../EU [new MiFID];

Or. en

Amendment 17 Proposal for a regulation Article 2 – paragraph 1 – point 7 a (new)

Text proposed by the Commission Amendment

(7a) 'multilateral system' means a system that brings together or facilitates the bringing together of buying and selling interests in financial instruments, irrespective of the actual number of orders that are executed in the resulting transactions;

Or. en

Amendment 18 Proposal for a regulation Article 2 – paragraph 1 – point 17

Text proposed by the Commission Amendment

(17) ‘competent authority’ means the (17) ‘competent authority’ means the authority, designated by each Member authority, designated by each Member State in accordance with Article 48 of State in accordance with Article 69 of Directive [new MiFID], unless otherwise Directive .../.../EU [new MiFID], unless specified in that Directive; otherwise specified in that Directive;

PR\895737EN.doc 15/51 PE485.888v01-00 EN Or. en

Amendment 19 Proposal for a regulation Article 2 – paragraph 1 – point 19

Text proposed by the Commission Amendment

(19) ‘consolidated tape provider (CTP)’ (19) ‘consolidated tape provider (CTP)’ means a person authorised under the means a person authorised under the provisions established in Directive [new provisions established in Directive MiFID] to provide the service of collecting .../.../EU [new MiFID] to provide the trade reports for financial instruments service of collecting trade reports for listed in Articles [5, 6, 11 and 12] of this financial instruments listed in Articles 5, 6, Regulation from regulated markets, MTFs, 11 and 12 of this Regulation from OTFs and APAs and consolidating them regulated markets, MTFs, OTFs and into a continuous electronic live data Approved Publication Arrangements stream providing real-time price and (APAs) and consolidating them into a volume data per financial instrument; continuous electronic live data stream providing real-time and, where provided for in Article 66(1) and (2) of Directive .../.../EU [new MiFID], delayed price and volume data per financial instrument;

Or. en

Amendment 20 Proposal for a regulation Article 2 – paragraph 1 – point 21

Text proposed by the Commission Amendment

(21) ‘management body’ means the (21) 'management body' means the governing body of a data reporting services governing body of an investment firm, provider, comprising the supervisory and market operator or data reporting services the managerial functions, which has the provider, comprising the supervisory and ultimate decision-making authority and is the managerial functions, which has the empowered to set the entity's strategy, ultimate decision-making authority and is objectives and overall direction. The empowered to set the investment firm's, management body shall include persons the market operator's or the data services who effectively direct the business of the provider's strategy, objectives and overall entity; direction, including persons who effectively direct the business of the entity;

Or. en

PE485.888v01-00 16/51 PR\895737EN.doc EN Amendment 21 Proposal for a regulation Article 2 – paragraph 1 – point 22

Text proposed by the Commission Amendment

(22) ‘supervisory function’ means the deleted management body acting in its supervisory function of overseeing and monitoring management decision- making;

Or. en

Amendment 22 Proposal for a regulation Article 2 – paragraph 1 – point 23

Text proposed by the Commission Amendment

(23) ‘senior management’ means those deleted individuals who exercise executive functions within a data reporting services provider and who are responsible and accountable for the day-to-day management.

Or. en

Amendment 23

Proposal for a regulation Article 2 – paragraph 1 – point 26 a (new)

Text proposed by the Commission Amendment

(26a) 'interoperability arrangement' means an interoperability arrangement within the meaning of point (9) of Article 2(1) of Regulation (EU) No …/... [EMIR].

Or. en

Amendment 24 Proposal for a regulation Article 2 – paragraph 1 – point 27

PR\895737EN.doc 17/51 PE485.888v01-00 EN Text proposed by the Commission Amendment

(27) 'investment services and activities' (27) 'investment services and activities' means the services and activities defined in means services and activities within the Article 4(1)(2) of Directive [new MiFID]. meaning of point (1) of Article 4(2)of Directive .../.../EU [new MiFID];

Or. en

Amendment 25 Proposal for a regulation Article 2 – paragraph 1 – point 29

Text proposed by the Commission Amendment

(29) ‘wholesale energy product’ means (29) ‘wholesale energy product’ means those contracts and derivatives defined in contracts and derivatives within the Article 2(4) of Regulation [REMIT]. meaning of Article 2(4) of Regulation (EU) No 1227/2011 of the European Parliament and of the Council of 25 October 2011 on wholesale energy market integrity and transparency1; ______1 OJ L 326, 8.12.2011, p. 1.

Or. en

Amendment 26 Proposal for a regulation Article 2 – paragraph 2

Text proposed by the Commission Amendment

2. The definitions provided in paragraph 1 2. The definitions provided in Article 4(1) also apply to Directive [new MiFID]. of Directive .../.../EU [new MiFID] also apply to this Regulation.

Or. en

Amendment 27 Proposal for a regulation Article 2 – paragraph 3

PE485.888v01-00 18/51 PR\895737EN.doc EN Text proposed by the Commission Amendment

3. The Commission may adopt, by means 3. The Commission shall be empowered to of delegated acts in accordance with adopt delegated acts in accordance with Article 41, measures specifying some Article 41 specifying certain technical technical elements of the definitions laid elements of the definitions laid down in down in paragraph 1 to adjust them to points (3), (3a), (7), (7a), (10) to (16), (18) market development. to (26a), (28) and (29) of paragraph 1 of this Article to adjust them to market development.

Or. en

Amendment 28 Proposal for a regulation Article 3 – paragraph 1

Text proposed by the Commission Amendment

1. Regulated markets and investment firms 1. Regulated markets and investment firms and market operators operating an MTF or and market operators operating an MTF an OTF shall make public current bid and shall make public current bid and offer offer prices and the depth of trading prices and the depth of trading interests at interests at those prices which are those prices which are advertised through advertised through their systems for shares, their systems for shares, depositary depositary receipts, exchange-traded funds, receipts, exchange-traded funds, certificates and other similar financial certificates and other similar financial instruments admitted to trading or which instruments admitted to trading or which are traded on an MTF or an OTF. This are traded on an MTF. This requirement requirement shall also apply to actionable shall also apply to actionable indications of indications of interests. Regulated markets interests. Regulated markets and and investment firms and market operators investment firms and market operators operating an MTF or an OTF shall make operating an MTF shall make this this information available to the public on a information available to the public on a continuous basis during normal trading continuous basis during normal trading hours. hours.

Or. en

Amendment 29 Proposal for a regulation Article 3 – paragraph 2

Text proposed by the Commission Amendment

2. Regulated markets and investment firms 2. Regulated markets and investment firms and market operators operating an MTF or and market operators operating an MTF

PR\895737EN.doc 19/51 PE485.888v01-00 EN an OTF shall give access, on reasonable shall give access, on reasonable commercial terms and on a non- commercial terms and on a non- discriminatory basis, to the arrangements discriminatory basis, to the arrangements they employ for making public the they employ for making public the information under the first paragraph to information under the first paragraph to investment firms which are obliged to investment firms which are obliged to publish their quotes in shares, depositary publish their quotes in shares, depositary receipts, exchange-traded funds, receipts, exchange-traded funds, certificates and other similar financial certificates and other similar financial instruments pursuant to Article 13. instruments pursuant to Article 13.

Or. en

Amendment 30 Proposal for a regulation Article 4 – paragraph 1

Text proposed by the Commission Amendment

1. Competent authorities shall be able to 1. Competent authorities shall be able to waive the obligation for regulated markets waive the obligation for regulated markets and investment firms and market operators and investment firms and market operators operating an MTF or an OTF to make operating an MTF to make public the public the information referred to in Article information referred to in Article 3(1) 3(1) based on the market model or the type based on the market model or the type and and size of orders in the cases defined in size of orders in the cases defined in accordance with paragraph 3. In particular, accordance with paragraph 3. In particular, the competent authorities shall be able to the competent authorities shall be able to waive the obligation in respect of orders waive the obligation in respect of orders that are large in scale compared with that are large in scale compared with normal market size for the share, normal market size for the share, depositary receipt, exchange-traded fund, depositary receipt, exchange-traded fund, certificate or other similar financial certificate or other similar financial instrument or type of share, depositary instrument or type of share, depositary receipt, exchange-traded fund, certificate receipt, exchange-traded fund, certificate or other similar financial instrument in or other similar financial instrument in question. question.

Or. en

Amendment 31 Proposal for a regulation Article 5 – paragraph 1

Text proposed by the Commission Amendment

1. Regulated markets and investment firms 1. Regulated markets and investment firms and market operators operating an MTF or and market operators operating an MTF

PE485.888v01-00 20/51 PR\895737EN.doc EN an OTF shall make public the price, shall make public the price, volume and volume and time of the transactions time of the transactions executed in respect executed in respect of shares, depositary of shares, depositary receipts, exchange- receipts, exchange-traded funds, traded funds, certificates and other similar certificates and other similar financial financial instruments admitted to trading or instruments admitted to trading or which which are traded on an MTF. Regulated are traded on an MTF or an OTF. markets and investment firms and market Regulated markets and investment firms operators operating an MTF shall make and market operators operating an MTF or details of all such transactions public as an OTF shall make details of all such close to real-time as is technically possible. transactions public as close to real-time as is technically possible.

Or. en

Amendment 32 Proposal for a regulation Article 5 – paragraph 2

Text proposed by the Commission Amendment

2. Regulated markets and investment firms 2. Regulated markets and investment firms and market operators operating an MTF or and market operators operating an MTF an OTF shall give access, on reasonable shall give access, on reasonable commercial terms and on a non- commercial terms and on a non- discriminatory basis, to the arrangements discriminatory basis, to the arrangements they employ for making public the they employ for making public the information under paragraph 1 to information under paragraph 1 to investment firms which are obliged to investment firms which are obliged to publish the details of their transactions in publish the details of their transactions in shares, depositary receipts, exchange- shares, depositary receipts, exchange- traded funds, certificates and other similar traded funds, certificates and other similar financial instruments pursuant to financial instruments pursuant to Article 19. Article 19.

Or. en

Amendment 33 Proposal for a regulation Article 6 – paragraph 1

Text proposed by the Commission Amendment

1. Competent authorities shall be able to 1. Competent authorities shall be able to authorise regulated markets to provide for authorise regulated markets to provide for deferred publication of the details of deferred publication of the details of transactions based on their type or size. In transactions based on their type or size. In particular, the competent authorities may particular, the competent authorities may

PR\895737EN.doc 21/51 PE485.888v01-00 EN authorise the deferred publication in authorise the deferred publication in respect of transactions that are large in respect of transactions that are large in scale compared with the normal market scale compared with the normal market size for that share, depositary receipt, size for that share, depositary receipt, exchange-traded fund, certificate or other exchange-traded fund, certificate or other similar financial instrument or that class of similar financial instrument or that class of share, depositary receipt, exchange-traded share, depositary receipt, exchange-traded fund, certificate or other similar financial fund, certificate or other similar financial instrument. Regulated markets and instrument. Regulated markets and investment firms and market operators investment firms and market operators operating an MTF or an OTF shall obtain operating an MTF shall obtain the the competent authority's prior approval of competent authority's prior approval of proposed arrangements for deferred trade- proposed arrangements for deferred trade- publication, and shall clearly disclose these publication, and shall clearly disclose these arrangements to market participants and arrangements to market participants and the public. ESMA shall monitor the the public. ESMA shall monitor the application of these arrangements for application of these arrangements for deferred trade-publication and shall submit deferred trade-publication and shall submit an annual report to the Commission on an annual report to the Commission on how they are applied in practice. how they are applied in practice.

Or. en

Amendment 34 Proposal for a regulation Article 6 – paragraph 2 – point a

Text proposed by the Commission Amendment

(a) the details that need to be specified by (a) the details that need to be specified by regulated markets, investment firms, regulated markets, investment firms, including systematic internalisers and including systematic internalisers and investment firms and regulated markets investment firms and regulated markets operating a MTF or an OTF in the operating a MTF in the information to be information to be made available to the made available to the public for each class public for each class of financial of financial instrument concerned; instrument concerned;

Or. en

Amendment 35 Proposal for a regulation Article 6 – paragraph 2 – point b

Text proposed by the Commission Amendment

(b) the conditions for authorising a (b) the conditions for authorising a regulated market, an investment firm, regulated market, an investment firm,

PE485.888v01-00 22/51 PR\895737EN.doc EN including a systematic internaliser or an including a systematic internaliser or an investment firm or market operator investment firm or market operator operating an MTF or an OTF for a operating an MTF for a deferred deferred publication of trades and the publication of trades and the criteria to be criteria to be applied when deciding the applied when deciding the transactions for transactions for which, due to their size or which, due to their size or the type of the type of share, depositary receipt, share, depositary receipt, exchange-traded exchange-traded fund, certificate or other fund, certificate or other similar financial similar financial instrument involved, instrument involved, deferred publication deferred publication is allowed for each is allowed for each class of financial class of financial instrument concerned. instrument concerned.

Or. en

Amendment 36 Proposal for a regulation Article 8 – paragraph 1

Text proposed by the Commission Amendment

1. Competent authorities shall be able to 1. Competent authorities shall be able to waive the obligation for regulated markets waive the obligation for regulated markets and investment firms and market operators and investment firms and market operators operating an MTF or an OTF to make operating an MTF to make public the public the information referred to in Article information referred to in Article 7(1) for 7(1) for specific sets of products based on specific sets of products based on the the market model, the specific market model, the specific characteristics characteristics of trading activity in a of trading activity in a product and the product and the liquidity in the cases liquidity in the cases defined in accordance defined in accordance with paragraph 4. with paragraph 4.

Or. en

Amendment 37 Proposal for a regulation Article 8 – paragraph 2

Text proposed by the Commission Amendment

2. Competent authorities shall be able to 2. Competent authorities shall be able to waive the obligation for regulated markets waive the obligation for regulated markets and investment firms and market operators and investment firms and market operators operating an MTF or an OTF to make operating an MTF to make public the public the information referred to in information referred to in Article 7(1) paragraph 1 of Article 7 based on the type based on the type and size of orders and and size of orders and method of trading in method of trading in accordance with accordance with paragraph 4. In particular, paragraph 4. In particular, the competent the competent authorities shall be able to authorities shall be able to waive the

PR\895737EN.doc 23/51 PE485.888v01-00 EN waive the obligation in respect of orders obligation in respect of orders that are large that are large in scale compared with in scale compared with normal market size normal market size for the bond, structured for the bond, structured finance product, finance product, emission allowance or emission allowance or derivative or type of derivative or type of bond, structured bond, structured finance product, emission finance product, emission allowance or allowance or derivative in question. derivative in question.

Or. en

Amendment 38 Proposal for a regulation Article 8 – paragraph 4 – point b – point i

Text proposed by the Commission Amendment

(i) the market model; deleted

Or. en

Amendment 39 Proposal for a regulation Article 8 – paragraph 4 – point b – point ii

Text proposed by the Commission Amendment

(ii) the specific characteristics of trading deleted activity in a product;

Or. en

Amendment Proposal for a regulation Article 8 – paragraph 4 – point b – point iv

Text proposed by the Commission Amendment

(iv) the size or type of orders and the size (iv) the size of orders and the size and type and type of an issue of a financial of an issue of a financial instrument. instrument.

Or. en

Amendment 41 Proposal for a regulation Article 10 – paragraph 2 – point b

PE485.888v01-00 24/51 PR\895737EN.doc EN Text proposed by the Commission Amendment

(b) the conditions for authorising for each (b) the conditions for authorising for each class of financial instrument concerned a class of financial instrument concerned a deferred publication of trades for a deferred publication of trades for a regulated market, an investment firm, regulated market, an investment firm, including a systematic internaliser or an including a systematic internaliser or an investment firm or market operator investment firm or market operator operating an MTF or an OTF and the operating an MTF or an OTF and the criteria to be applied when deciding the criteria to be applied when deciding the transactions for which, due to their size or transactions for which, due to their size or the type of bond, structured finance the type of bond, structured finance product, emission allowance or derivative product, emission allowance or derivative involved, deferred publication and/or the involved deferred publication is allowed. omission of the volume of the transaction is allowed.

Or. en

Amendment 42 Proposal for a regulation Article 11 – paragraph 1

Text proposed by the Commission Amendment

1. Regulated markets and market operators 1. Regulated markets and market operators and investment firms operating MTFs and and investment firms operating MTFs and, OTFs shall make the information published where applicable, OTFs shall make the in accordance with Articles 3 to 10 information published in accordance with available to the public by offering pre- and Articles 3 to 10 available to the public by post-trade transparency data separately. offering pre- and post-trade transparency data separately.

Or. en

Amendment 43 Proposal for a regulation Article 12 – paragraph 1

Text proposed by the Commission Amendment

1. Regulated markets, MTFs and OTFs 1. Regulated markets, MTFs and, where shall make the information published in applicable, OTFs shall make the accordance with Articles 3 to 10 available information published in accordance with to the public on a reasonable commercial Articles 3 to 10 available to the public on a basis. The information shall be made reasonable commercial basis. The available free of charge 15 minutes after information shall be made available free of

PR\895737EN.doc 25/51 PE485.888v01-00 EN the publication of a transaction. charge 15 minutes after the publication of a transaction.

Or. en

Amendment 44 Proposal for a regulation Article -13 a (new)

Text proposed by the Commission Amendment

Article -13a Obligation to trade OTC through systematic internalisers 1. All transactions in shares, depositary receipts, exchange-traded funds, certificates and other similar financial instruments which are not intragroup transactions as referred to in Article 2a of Regulation (EU) No …/... [EMIR] and which are not concluded on a regulated market or MTF shall be concluded through a systematic internaliser unless the transaction involves the primary issuance of the instrument. 2. All transactions in bonds, structured finance products admitted to trading on a regulated market or for which a prospectus has been published, emission allowances and derivatives which are eligible for clearing or which are admitted to trading on a regulated market or are traded on an MTF or an OTF and which are not subject to the trading obligation under Article 26, which are not concluded on a regulated market, MTF, OTF or third-country trading venue assessed as equivalent in accordance with Article 26(4), shall be concluded through a systematic internaliser unless the transaction involves the primary issuance of the instrument.

Or. en

PE485.888v01-00 26/51 PR\895737EN.doc EN Amendment 45 Proposal for a regulation Article 13 – paragraph 1

Text proposed by the Commission Amendment

1. Systematic internalisers in shares, 1. Systematic internalisers in shares, depositary receipts, exchange-traded funds, depositary receipts, exchange-traded funds, certificates and other similar financial certificates and other similar financial instruments shall publish a firm quote in instruments shall publish a firm quote in those shares, depositary receipts, those shares, depositary receipts, exchange-traded funds, certificates and exchange-traded funds, certificates and other similar financial instruments other similar financial instruments admitted to trading on a regulated market admitted to trading on a regulated market or traded on an MTF or an OTF for which or traded on an MTF for which they are they are systematic internalisers and for systematic internalisers and for which there which there is a liquid market. In the case is a liquid market. In the case of shares, of shares, depositary receipts, exchange- depositary receipts, exchange-traded funds, traded funds, certificates and other similar certificates and other similar financial financial instruments for which there is not instruments for which there is not a liquid a liquid market, systematic internalisers market, systematic internalisers shall shall disclose quotes to their clients on disclose quotes to their clients on request. request.

Or. en

Amendment 46 Proposal for a regulation Article 13 – paragraph 6

Text proposed by the Commission Amendment

6. The competent authority of the most 6. The competent authority of the most relevant market in terms of liquidity as relevant market in terms of liquidity as defined in Article 23 for each share, defined in Article 23 for each share, depositary receipt, exchange-traded fund, depositary receipt, exchange-traded fund, certificate and other similar financial certificate and other similar financial instrument shall determine at least instrument shall determine at least annually, on the basis of the arithmetic annually, on the basis of the arithmetic average value of the orders executed in the average value of the orders executed in the market in respect of that financial market in respect of that financial instrument, the class to which it belongs. instrument, the class to which it belongs. This information shall be made public to This information shall be made public to all market participants. all market participants and communicated to ESMA which shall publish the information on its website.

Or. en

PR\895737EN.doc 27/51 PE485.888v01-00 EN Amendment 47 Proposal for a regulation Article 18 – paragraph 1

Text proposed by the Commission Amendment

1. Competent authorities and ESMA shall 1. Competent authorities and ESMA shall monitor the application of this Article monitor the application of Article 17 regarding the sizes at which quotes are regarding the sizes at which quotes are made available to clients of the investment made available to clients of the investment firm and made available to other market firm and made available to other market participants relative to other trading participants relative to other trading activity of the firm, and the degree to activity of the firm, and the degree to which the quotes reflect prevailing market which the quotes reflect prevailing market conditions in relation to transactions in the conditions in relation to transactions in the same or similar instruments taking place on same or similar instruments taking place on regulated markets, MTFs, or OTFs. Within regulated markets, MTFs, or OTFs. Within 2 years from the date of entry into force, ...*, ESMA shall report to the Commission ESMA shall report to the Commission on on the application of Article 17. In case of the application of this Article. In case of significant quoting and trading activity just significant quoting and trading activity just beyond the threshold mentioned in Article beyond the threshold mentioned in 17(3) or outside prevailing market paragraph 3 of Article 17 or outside conditions, ESMA shall report to the prevailing market conditions, they shall Commission before this deadline. report to the Commission before this deadline. ______* OJ please insert date: 24 months after entry into force of this Regulation.

Or. en

Amendment 48 Proposal for a regulation Article 19 – paragraph 1

Text proposed by the Commission Amendment

1. Investment firms which, either on own 1. Investment firms which, either on own account or on behalf of clients, conclude account or on behalf of clients, conclude transactions in shares, depositary receipts, transactions in shares, depositary receipts, exchange-traded funds, certificates or other exchange-traded funds, certificates or other similar financial instruments admitted to similar financial instruments admitted to trading on a regulated market or which are trading on a regulated market or which are traded on an MTF or an OTF, shall make traded on an MTF, shall make public the public the volume and price of those volume and price of those transactions and transactions and the time at which they the time at which they were concluded. were concluded. This information shall be This information shall be made public

PE485.888v01-00 28/51 PR\895737EN.doc EN made public through an APA. through an APA.

Or. en

Amendment 49 Proposal for a regulation Article 19 – paragraph 2

Text proposed by the Commission Amendment

2. The information which is made public in 2. The information which is made public in accordance with paragraph 1 and the time- accordance with paragraph 1 and the time- limits within which it is published shall limits within which it is published shall comply with the requirements adopted comply with the requirements adopted pursuant to Article 6. Where the measures pursuant to Article 6. Where the measures adopted pursuant to Article 6 provide for adopted pursuant to Article 6 provide for deferred reporting for certain categories of deferred reporting for certain categories of transaction in shares, depositary receipts, transaction in shares, depositary receipts, exchange-traded funds, certificates or other exchange-traded funds, certificates or other similar financial instruments, this similar financial instruments, this possibility shall also apply to those possibility shall also apply to those transactions when undertaken outside transactions when undertaken outside regulated markets, MTFs or OTFs. regulated markets or MTFs.

Or. en

Amendment 50 Proposal for a regulation Article 23 – paragraph 2

Text proposed by the Commission Amendment

2. The obligation laid down in paragraph 1 2. The obligation laid down in paragraph 1 shall not apply to financial instruments shall not apply to financial instruments which are not admitted to trading or traded which are not admitted to trading on a on an MTF or an OTF, to financial regulated market or traded on an MTF or instruments whose value does not depend an OTF, to financial instruments whose on that of a financial instrument admitted value does not depend on that of a financial to trading or traded on an MTF or an OTF, instrument admitted to trading on a nor to financial instruments which do not regulated market or traded on an MTF or or are not likely to have an effect on a an OTF, nor to financial instruments which financial instrument admitted to trading or do not or are not likely to have an effect on traded on an MTF or an OTF. a financial instrument admitted to trading or traded on an MTF or an OTF.

Or. en

PR\895737EN.doc 29/51 PE485.888v01-00 EN Amendment 51 Proposal for a regulation Article 23 – paragraph 8 – subparagraph 2

Text proposed by the Commission Amendment

ESMA shall submit those draft regulatory ESMA shall submit those draft regulatory technical standards to the Commission by technical standards to the Commission by […]. ...*. ______* OJ please insert date: 12 months after entry into force of this Regulation.

Or. en

Amendment 52 Proposal for a regulation Article 23 – paragraph 9

Text proposed by the Commission Amendment

9. Two years after entry into force of this 9. By ...* ESMA shall report to the Regulation, ESMA shall report to the Commission on the functioning of this Commission on the functioning of this Article , including whether the content and Article, including whether the content and format of transaction reports received and format of transaction reports received and exchanged between competent authorities exchanged between competent authorities comprehensively enable to monitor the comprehensively enable to monitor the activities of investment firms in accordance activities of investment firms in accordance with Article 21. The Commission may take with Article 21. The Commission may take steps to propose any changes, including steps to propose any changes, including providing for transactions to be transmitted providing for transactions to be transmitted to a system appointed by ESMA instead of to a system appointed by ESMA instead of to competent authorities, which allows to competent authorities, which allows relevant competent authorities to access all relevant competent authorities to access all the information reported pursuant to this the information reported pursuant to this Article. The Commission shall forward Article. ESMA's report to the European Parliament and to the Council. ______* OJ please insert date: 24 months after entry into force of this Regulation.

Or. en

PE485.888v01-00 30/51 PR\895737EN.doc EN Amendment 53 Proposal for a regulation Article 24 – paragraph 4 – subparagraph 1

Text proposed by the Commission Amendment

4. The Commission may, in accordance 4. The Commission may, in accordance with the procedure referred to in Article with the examination procedure referred to 42, adopt decisions determining that the in Article 42(2), adopt decisions legal and supervisory framework of a third determining that the legal and supervisory country ensures that a trading venue framework of a third country ensures that a authorised in that third country complies trading venue authorised in that third with legally binding requirements which country complies with legally binding are equivalent to the requirements for the requirements which are equivalent to the trading venues referred to in requirements for the trading venues subparagraphs (a) to (c) of paragraph 1 referred to in points (a), (b) and (c) of resulting from this Regulation, Directive paragraph 1 of this Article, resulting from [new MiFID], and Regulation [new MAR], this Regulation, Directive .../.../EU [new and which are subject to effective MiFID], and Regulation (EU) No …/... supervision and enforcement in that third [new MAR], and which are subject to country. effective supervision and enforcement in that third country.

Or. en

Amendment 54 Proposal for a regulation Article 24 – paragraph 5

Text proposed by the Commission Amendment

5. The Commission shall adopt by means 5. ESMA shall develop draft regulatory of delegated acts in accordance with technical standards specifying the types of Article 41 measures specifying the types contracts referred to in paragraph 2 which of contracts referred to in paragraph 2 have a direct, substantial and foreseeable which have a direct, substantial and effect within the Union and the cases foreseeable effect within the Union and the where the trading obligation is necessary or cases where the trading obligation is appropriate to prevent the evasion of any necessary or appropriate to prevent the provision of this Regulation. evasion of any provision of this Regulation. ESMA shall submit those draft regulatory technical standards to the Commission by ...*. Power is delegated to the Commission to adopt the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of

PR\895737EN.doc 31/51 PE485.888v01-00 EN Regulation (EU) No 1095/2010. ______* OJ please insert date: 12 months after entry into force of this Regulation.

Or. en

Amendment 55 Proposal for a regulation Article 26 – paragraph 1 – subparagraph 1 – introductory part

Text proposed by the Commission Amendment

ESMA shall develop draft implementing ESMA shall develop draft regulatory technical standards to determine the technical standards to determine the following: following:

Or. en

Amendment 56 Proposal for a regulation Article 26 – paragraph 1 – subparagraph 2

Text proposed by the Commission Amendment

ESMA shall submit the draft ESMA shall submit the draft regulatory implementing technical standards referred technical standards referred to in the first to in the first subparagraph to the subparagraph to the Commission within Commission within three months after the three months after the regulatory technical implementing technical standards in standards in accordance with Article 4(3) accordance with Article 4(3) of Regulation of Regulation (EU) No …/...[EMIR] are [ ] (EMIR) are adopted by the adopted by the Commission. Commission.

Or. en

Amendment 57 Proposal for a regulation Article 26 – paragraph 1 – subparagraph 3

Text proposed by the Commission Amendment

Power is conferred to the Commission to Power is conferred to the Commission to adopt the implementing technical adopt the regulatory technical standards standards referred to in the first referred to in the first subparagraph in subparagraph in accordance with Article accordance with Articles 10 to 14 of

PE485.888v01-00 32/51 PR\895737EN.doc EN 15 of Regulation 1095/2010. Regulation (EU) No 1095/2010.

Or. en

Amendment 58 Proposal for a regulation Article 26 – paragraph 3 – subparagraph 1 – introductory part

Text proposed by the Commission Amendment

3. In developing the draft implementing 3. In developing the draft regulatory technical standards, ESMA shall consider technical standards, ESMA shall consider the class of derivatives or a relevant subset the class of derivatives or a relevant subset thereof as sufficiently liquid pursuant to thereof as sufficiently liquid pursuant to the following criteria: the following criteria:

Or. en

Amendment 59 Proposal for a regulation Article 26 – paragraph 3 – subparagraph 2

Text proposed by the Commission Amendment

Before submitting the draft implementing Before submitting the draft regulatory technical standards to the Commission for technical standards to the Commission for adoption, ESMA shall conduct a public adoption, ESMA shall conduct a public consultation and, where appropriate, may consultation and, where appropriate, may consult with the competent authorities of consult with the competent authorities of third countries. third countries.

Or. en

Amendment 60 Proposal for a regulation Article 26 – paragraph 4 – subparagraph 2

Text proposed by the Commission Amendment

Following a notification by ESMA, the Following thenotification referred to in Commission may publish a call for the first subparagraph, ESMA shall development of proposals for the trading of publish a call for development of proposals those derivatives on the venues referred to for the trading of those derivatives on the in Article 24(1). venues referred to in Article 24(1).

Or. en

PR\895737EN.doc 33/51 PE485.888v01-00 EN Amendment 61 Proposal for a regulation Article 26 – paragraph 5

Text proposed by the Commission Amendment

5. ESMA shall in accordance with 5. ESMA shall in accordance with paragraph 1, submit to the Commission paragraph 1, submit to the Commission new draft implementing technical new draft regulatory technical standards to standards to amend, suspend or revoke amend, suspend or revoke existing existing implementing technical standards regulatory technical standards whenever whenever there is a material change in the there is a material change in the criteria set criteria set out in paragraph 2. Before out in paragraph 2. Before doing so, ESMA doing so, ESMA may consult, where may consult, where appropriate, the appropriate, the competent authorities of competent authorities of third countries. third countries. Power is conferred to the Power is conferred to the Commission Commission toamend, suspend and revoke toamend, suspend and revoke the existing the existing implementing technical regulatory technical standards in standards in accordance with Article 15 of accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010. Regulation (EU) No 1095/2010.

Or. en

Amendment 62 Proposal for a regulation Article 26 – paragraph 6

Text proposed by the Commission Amendment

6. Powers are delegated to the 6. ESMA shall develop draft regulatory Commission to adopt regulatory technical technical standards specifying the criteria standards specifying the criteria referred to referred to in point (b) of paragraph 2. in paragraph 2(b), to be adopted in accordance with Articles 10 to 14 of Regulation EU 1095/2010. ESMA shall submit drafts for those regulatory technical standards to the Commission by --/--/--. ESMA shall submit those draft regulatory technical standards to the Commission by ...*.

Power is delegated to the Commission to adopt the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010. ______

PE485.888v01-00 34/51 PR\895737EN.doc EN * OJ please insert date: 12 months after entry into force of this Regulation.

Or. en

Amendment 63

Proposal for a regulation Article 29 – paragraph 4

Text proposed by the Commission Amendment

4. The competent authority of the trading 4. For transferable securities and money venue may only deny a CCP access to a market instruments, the competent trading venue where such access would authority of the trading venue may only threaten the smooth or orderly functioning deny a CCP access to a trading venue of markets. where such access would threaten the smooth or orderly functioning of markets. For other financial instruments, access of the CCP to a trading venue shall be granted only where such access would not require interoperability or threaten the smooth and orderly functioning of markets in particular due to liquidity fragmentation and the trading venue has put in place adequate mechanisms to prevent such fragmentation. If a competent authority denies access on 4a. If a competent authority denies access that basis it shall issue its decision within on that basis it shall issue its decision two months following receipt of the within two months following receipt of the request referred to in paragraph 2 and request referred to in paragraph 2 and provide full reasons to the trading venue provide full reasons to the trading venue and the CCP including the evidence on and the CCP including the evidence on which its decision is based. which its decision is based.

Or. en

Amendment 64

Proposal for a regulation Article 29 – paragraph 6 – point a

Text proposed by the Commission Amendment

(a) the conditions under which access (a) the conditions under which access could be denied by a trading venue, could be denied by a trading venue for including conditions based on the volume transferable securities and money market of transactions, the number of users or instruments, including conditions based on

PR\895737EN.doc 35/51 PE485.888v01-00 EN other factors creating undue risks. the volume of transactions, the number of users or other factors creating undue risks.

Or. en

Amendment 65

Proposal for a regulation Article 29 – paragraph 6 a (new)

Text proposed by the Commission Amendment

6a. ESMA shall develop draft regulatory technical standards to specify the notion of liquidity fragmentation. Those draft regulatory technical standards shall, where possible, reflect the regulatory technical standards adopted by the Commission in accordance with Article 5a of Regulation (EU) No …/... [EMIR]. ESMA shall submit those draft regulatory technical standards to the Commission by ...*. Power is delegated to the Commission to adopt the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010. ______* OJ please insert date: 12 months after entry into force of this Regulation.

Or. en

Amendment 66 Proposal for a regulation Article 31 – paragraph -1 (new)

Text proposed by the Commission Amendment

-1. In accordance with Article 9(2) of Regulation (EU) No 1095/2010, ESMA shall monitor the investment products, including structured deposits and financial instruments which are marketed, distributed or sold in the Union

PE485.888v01-00 36/51 PR\895737EN.doc EN and may proactively investigate new investment products or financial instruments before they are marketed, distributed or sold in the Union in cooperation with the competent authorities.

Or. en

Amendment 67

Proposal for a regulation Article 31 – paragraph 1 – subparagraph 1 – point a

Text proposed by the Commission Amendment

(a) the marketing, distribution or sale of (a) the marketing, distribution or sale of certain financial instruments or financial certain investment products, including instruments with certain features; or structured deposits, financial instruments or financial instruments with certain features; or

Or. en

Amendment 68 Proposal for a regulation Article 31 – paragraph 2 – point b

Text proposed by the Commission Amendment

(b) regulatory requirements under Union (b) regulatory requirements under Union legislation that are applicable to the legislation that are applicable to the relevant financial instrument or activity do relevant investment product, financial not address the threat; instrument or activity do not address the threat;

Or. en

Amendment 69 Proposal for a regulation Article 31 – paragraph 2 – subparagraph 1 a (new)

Text proposed by the Commission Amendment

Where the conditions set out in the first subparagraph are fulfilled, ESMA may impose the prohibition or restriction

PR\895737EN.doc 37/51 PE485.888v01-00 EN referred to in paragraph 1 on a precautionary basis before an investment product or financial instrument has been marketed or sold to clients.

Or. en

Amendment 70 Proposal for a regulation Article 31 – paragraph 4 a (new)

Text proposed by the Commission Amendment

4a. Before taking a decision under paragraph 1, ESMA may give notice of its intention to prohibit or restrict an investment product or financial instrument unless certain changes are made to features of the investment product or financial instrument within a specified timescale.

Or. en

Amendment 71 Proposal for a regulation Article 31 – paragraph 6

Text proposed by the Commission Amendment

6. ESMA shall review a prohibition or 6. ESMA shall review a prohibition or restriction imposed under paragraph 1 at restriction imposed under paragraph 1 at appropriate intervals and at least every appropriate intervals and at least every three months. If the prohibition or three months. Where the prohibition or restriction is not renewed after that three restriction is imposed for reasons of month period it shall expire. investor protection, ESMA shall review the prohibition or restriction annually. If the prohibition or restriction is not renewed after that three-month or annual period it shall expire.

Or. en

Amendment 72 Proposal for a regulation Article 31 – paragraph 8

PE485.888v01-00 38/51 PR\895737EN.doc EN Text proposed by the Commission Amendment

8. The Commission shall adopt by means 8. The Commission shall adopt by means of delegated acts in accordance with of delegated acts in accordance with Article 41 measures specifying criteria and Article 41 measures specifying criteria and factors to be taken into account by ESMA factors to be taken into account by ESMA in determining when the threats to investor in determining when the threats to investor protection or to the orderly functioning and protection or to the orderly functioning and integrity of financial markets and to the integrity of financial markets and to the stability of the whole or part of the stability of the whole or part of the financial system of the Union referred to in financial system of the Union referred to in paragraph 2(a) arise. point (a) of paragraph 2 arise. Those delegated acts shall ensure that ESMA is able to act, where appropriate, on a precautionary basis and shall not be required to wait until the product or financial instrument has been marketed or the type of activity or practice has been undertaken before taking action.

Or. en

Amendment 73 Proposal for a regulation Article 32 – paragraph -1 (new)

Text proposed by the Commission Amendment

-1. Competent authorities shall monitor the investment products, including structured deposits and financial instruments which are marketed, distributed or sold in or from their Member State and may proactively investigate new investment products or financial instruments before they are marketed, distributed or sold in or from the Member State.

Or. en

Amendment 74 Proposal for a regulation Article 32 – paragraph 1 – point a

PR\895737EN.doc 39/51 PE485.888v01-00 EN Text proposed by the Commission Amendment

(a) the marketing, distribution or sale of (a) the marketing, distribution or sale of certain financial instruments or financial certain investment products, including instruments with certain features; or structured deposits, financial instruments or financial instruments with certain features; or

Or. en

Amendment 75 Proposal for a regulation Article 32 – paragraph 2 – subparagraph 1 – point a

Text proposed by the Commission Amendment

(a) a financial instrument or activity or (a) an investment product, a financial practice gives rise to significant investor instrument or activity or practice gives rise protection concerns or poses a serious to significant investor protection concerns threat to the orderly functioning and or poses a serious threat to the orderly integrity of financial markets or the functioning and integrity of financial stability of whole or part of the financial markets or the stability of whole or part of system; the financial system;

Or. en

Amendment 76 Proposal for a regulation Article 32 – paragraph 2 – subparagraph 1 – point b

Text proposed by the Commission Amendment

(b) existing regulatory requirements under (b) existing regulatory requirements under Union legislation applicable to the Union legislation applicable to the financial instrument or activity or practice investment product, financial instrument or do not sufficiently address the risks activity or practice do not sufficiently referred to in paragraph (a) and the issue address the risks referred to in point (a) would not be better addressed by improved and the issue would not be better addressed supervision or enforcement of existing by improved supervision or enforcement of requirements; existing requirements;

Or. en

Amendment 77 Proposal for a regulation Article 32 – paragraph 2 – subparagraph 1 a (new)

PE485.888v01-00 40/51 PR\895737EN.doc EN Text proposed by the Commission Amendment

Where the conditions set out in the first subparagraph are fulfilled, the competent authority may impose a prohibition or restriction on a precautionary basis before an investment product or financial instrument has been marketed, distributed or sold to clients.

Or. en

Amendment 78 Proposal for a regulation Article 32 – paragraph 2 a (new)

Text proposed by the Commission Amendment

2a. Before imposing a prohibition or restriction under paragraph 1, the competent authority may give notice of its intention to prohibit or restrict an investment product or financial instrument unless certain changes are made to features of the investment product or financial instrument within a specified timescale.

Or. en

Amendment 79 Proposal for a regulation Article 32 – paragraph 3 – introductory part

Text proposed by the Commission Amendment

3. The competent authority shall not take 3. The competent authority shall not action under this Article unless, not less impose a prohibition or restriction under than one month before it takes the action, it this Article unless, not less than one week has notified all other competent authorities before it takes the action, it has notified all and ESMA in writing of details of: other competent authorities and ESMA in writing of details of:

Or. en

PR\895737EN.doc 41/51 PE485.888v01-00 EN Amendment 80 Proposal for a regulation Article 35 – paragraph 10

Text proposed by the Commission Amendment

10. The Commission shall adopt by means 10. The Commission shall adopt by means of delegated acts in accordance with of delegated acts in accordance with Article 41 measures specifying criteria and Article 41 measures specifying criteria and factors to be taken into account by ESMA factors to be taken into account by ESMA in determining when a threat to the orderly in determining when a threat to the orderly functioning and integrity of financial functioning and integrity of financial markets including in relation to delivery markets including in relation to delivery arrangements for physical commodities, or arrangements for physical commodities, or the stability of the whole or part of the the stability of the whole or part of the financial system in the Union referred to in financial system in the Union referred to in paragraph 2(a) arise. point (a) of paragraph 2 arise. Those criteria and factors shall take into account the draft regulatory technical standards developed in accordance with Article 59(3) of Directive .../.../EU [new MiFID] and shall differentiate between situations where ESMA takes action because a competent authority has failed to act and those where ESMA addresses an additional risk which the competent authority is not able to address pursuant to point (i) of Article 71(2) and points (f) and (g) of Article 72(1) of Directive .../.../EU [new MiFID].

Or. en

Amendment 81 Proposal for a regulation Article 36 – paragraph 1

Text proposed by the Commission Amendment

1. A third country firm may provide the 1. A third country firm may provide the services listed in Article 30 of Directive services listed in Article 30 of Directive [new MiFID] to eligible counterparties .../.../EU [new MiFID] to eligible established in the Union without the counterparties and to professional clients establishment of a branch only where it is within the meaning of Section I of Annex registered in the register of third country II of Directive .../.../EU [new MiFID] firms kept by ESMA in accordance with established in the Union without the Article 37. establishment of a branch only where it is registered in the register of third country firms kept by ESMA in accordance with

PE485.888v01-00 42/51 PR\895737EN.doc EN Article 37.

Or. en

Amendment 82 Proposal for a regulation Article 36 – paragraph 6 – subparagraph 1

Text proposed by the Commission Amendment

6. Powers are delegated to the 6. ESMA shall develop draft regulatory Commission to adopt regulatory technical technical standards specifying the standards specifying the information that information that the applicant third country the applicant third country firm shall firm shall provide to ESMA in its provide to ESMA in its application for application for registration in accordance registration in accordance with paragraph 3 with paragraph 3 and the format of and the format of information to be information to be provided in accordance provided in accordance with paragraph 4. with paragraph 4.

Or. en

Amendment 83 Proposal for a regulation Article 36 – paragraph 6 – subparagraph 2

Text proposed by the Commission Amendment

The regulatory technical standards referred ESMA shall submit those regulatory to in the first subparagraph shall be technical standards to the Commission by adopted in accordance with Article 10 to ...*. 14 of Regulation (EU) No 1095/2010. Power is delegated to the Commission to adopt the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010. ______* OJ please insert date: 12 months after entry into force of this Regulation.

Or. en

Amendment 84 Proposal for a regulation Article 36 – paragraph 6 – subparagraph 3

PR\895737EN.doc 43/51 PE485.888v01-00 EN Text proposed by the Commission Amendment

ESMA shall submit a draft to the deleted Commission for those regulatory technical standards by [].

Or. en

Amendment 85 Proposal for a regulation Article 37 – paragraph 1 – subparagraph 1

Text proposed by the Commission Amendment

The Commission may adopt a decision in The Commission may adopt a decision in accordance with the procedure referred to accordance with the examination in Article 42 in relation to a third country if procedure referred to in Article 42(2) in the legal and supervisory arrangements of relation to a third country if the legal and that third country ensure that firms supervisory arrangements of that third authorised in that third country comply country ensure that firms authorised in that with legally binding requirements which third country comply with legally binding have equivalent effect to the requirements requirements which have equivalent effect set out in Directive No [MiFID], in this to the requirements set out in Directive No Regulation and in Directive 2006/49/EC .../.../EU [MiFID], in this Regulation and in [Capital Adequacy Directive] and in their Directive 2006/49/EC and in their implementing measures and that third implementing measures and that third country provides for equivalent reciprocal country provides for equivalent reciprocal recognition of the prudential framework recognition of the prudential framework applicable to investment firms authorised applicable to investment firms authorised in accordance with this directive. in accordance with this Directive.

Or. en

Amendment 86

Proposal for a regulation Article 40

Text proposed by the Commission Amendment

The Commission shall be empowered to The Commission shall be empowered to adopt delegated acts in accordance with adopt delegated acts in accordance with Article 41 concerning Articles 2(3), 4(3), Article 41 concerning Article 2(3), Article 6(2), 8(4), 10(2), 11(2), 12(2), 13(7), 14(5), 4(3), Article 6(2), Article 8(4), Article 14(6), 16(3), 18(2), 18(3), 19(3), 20(3), 10(2), Article 11(2), Article 12(2), Article 28(6), 29(6), 30(3), 31(8), 32(6), 35(10) 13(7), Article 14(5) and 14(6), Article and 45(2). 16(3), Article 18(2) and (3), Article 19(3),

PE485.888v01-00 44/51 PR\895737EN.doc EN Article 20(3), Article 28(6), Article 29(6), Article 30(3), Article 31(8), Article 32(6) and Article 35(10).

Or. en

Amendment 87 Proposal for a regulation Article 41 – paragraph 2

Text proposed by the Commission Amendment

2. The delegation of power shall be 2. The power to adopt delegated acts conferred for an indeterminate period of referred to in Article 2(3), Article 4(3), time from the date referred to in Article Article 6(2), Article 8(4), Article 10(2), 41 paragraph 1. Article 11(2),Article 12(2), Article 13(7), Article 14(5) and 14(6), Article 16(3), Article 18(2) and 18(3), Article 19(3), Article 20(3), Article 28(6), Article 29(6), Article 30(3), Article 31(8), Article 32(6), and Article 35(10) shall be conferred for an indeterminate period of time.

Or. en

Amendment 88 Proposal for a regulation Article 41 – paragraph 3

Text proposed by the Commission Amendment

3. The delegation of powers may be 3. The delegation of power referred to in revoked at any time by the European Article 2(3), Article 4(3), Article 6(2), Parliament or by the Council. A decision of Article 8(4), Article 10(2), Article revocation shall put an end to the 11(2),Article 12(2), Article 13(7), Article delegation of the power specified in that 14(5) and 14(6), Article 16(3), Article decision. It shall take effect the day 18(2) and 18(3), Article 19(3), Article following the publication of the decision in 20(3), Article 28(6), Article 29(6), Article the Official Journal of the European Union 30(3), Article 31(8), Article 32(6), and or at a later date specified therein. It shall Article 35(10) may be revoked at any time not affect the validity of any delegated acts by the European Parliament or by the already in force. Council. A decision of revocation shall put an end to the delegation of the power specified in that decision. It shall take effect the day following the publication of the decision in the Official Journal of the European Union or at a later date specified

PR\895737EN.doc 45/51 PE485.888v01-00 EN therein. It shall not affect the validity of any delegated acts already in force.

Or. en

Amendment 89 Proposal for a regulation Article 41 – paragraph 5

Text proposed by the Commission Amendment

5. A delegated act shall enter into force 5. A delegated act shall enter into force only if no objection has been expressed only if no objection has been expressed either by the European Parliament or the either by the European Parliament or the Council within a period of 2 months of Council within a period of three months of notification of that act to the European notification of that act to the European Parliament and the Council or if, before the Parliament and the Council or if, before the expiry of that period, the European expiry of that period, the European Parliament and the Council have both Parliament and the Council have both informed the Commission that they will informed the Commission that they will not object. That period shall be extended not object. That period shall be extended by 2 months at the initiative of the by three months at the initiative of the European Parliament or the Council. European Parliament or the Council.

Or. en

Amendment 90 Proposal for a regulation Article 42 – paragraph 1

Text proposed by the Commission Amendment

1. For the adoption of implementing acts 1. The Commission shall be assisted by the under Articles 24, 26 and 37, the European Securities Committee established Commission shall be assisted by the by Commission Decision 2001/528/EC. European Securities Committee established That committee shall be a committee by Commission Decision 2001/528/EC. within the meaning of Regulation (EU) No That committee shall be a committee 182/2011. within the meaning of Regulation (EU) No 182/2011.

Or. en

Amendment 91 Proposal for a regulation Article 42 – paragraph 2

PE485.888v01-00 46/51 PR\895737EN.doc EN Text proposed by the Commission Amendment

2. Where reference is made to this 2. Where reference is made to this paragraph, Article 5 of Regulation (EU) No paragraph, Article 5 of Regulation (EU) No 182/2011 shall apply, having regard to the 182/2011 shall apply. provisions of Article 8 thereof.

Or. en

Amendment 92 Proposal for a regulation Article 43 – paragraph 2

Text proposed by the Commission Amendment

2. Before [2 years following application of 2. Before ...*, the Commission, after MiFIR as specified in Article 41(2)], the consulting ESMA shall present a report to Commission, after consulting ESMA shall the Council and the Parliament on the present a report to the Council and the functioning of Article 23, including Parliament on the functioning of whether the content and format of Article 13, including whether the content transaction reports received and exchanged and format of transaction reports received between competent authorities and exchanged between competent comprehensively enable to monitor the authorities comprehensively enable to activities of investment firms in accordance monitor the activities of investment firms with Article 23(1). The Commission may in accordance with Article 13(1). The make any appropriate proposals, including Commission may make any appropriate providing for transactions to be reported to proposals, including providing for a system appointed by ESMA instead of to transactions to be reported to a system competent authorities, which allows appointed by ESMA instead of to relevant competent authorities to access all competent authorities, which allows the information reported pursuant to this relevant competent authorities to access all Article. the information reported pursuant to this Article. ______* OJ please insert date: 42 months after entry into force of this Regulation.

Or. en

Amendment 93 Proposal for a regulation Article 45 – paragraph 1

PR\895737EN.doc 47/51 PE485.888v01-00 EN Text proposed by the Commission Amendment

1. Existing third country firms shall be 1. Third-country financial institutions able to continue to provide services and shall be able to provide services and activities in Member States, in accordance activities in Member States, in accordance with national regimes until [4 years after with national regimes until one year after the entry into force of this regulation]. the adoption by the Commission of a decision in relation to the relevant third country in accordance with Article 41(3) of Directive .../.../EU [new MiFID].

Or. en

Amendment 94 Proposal for a regulation Article 45 – paragraph 2

Text proposed by the Commission Amendment

2. The Commission may adopt by means deleted of delegated acts in accordance with Article 41 measures specifying an extension to the period of application of paragraph 2, taking into account the equivalence decisions already adopted by the Commission in accordance with Article 37 and expected developments in the regulatory and supervisory framework of third countries.

Or. en

Amendment 95 Proposal for a regulation Article 46 – paragraph 1

Text proposed by the Commission Amendment

This Regulation shall enter into force on This Regulation shall enter into force on the day following that of its publication in the twentieth day following that of its the Official Journal of the European Union. publication in the Official Journal of the European Union.

Or. en

PE485.888v01-00 48/51 PR\895737EN.doc EN Amendment 96 Proposal for a regulation Article 46 – paragraph 2

Text proposed by the Commission Amendment

This Regulation shall apply from [24 This Regulation shall apply from ...*, months after the entry into force of this except for Articles 2(3), 4(3), 6(2), 8(4), Regulation], except for Articles 2(3), 4(3), 10(2), 11(2), 12(2), 13(7), 14(5), 14(6), 6(2), 8(4), 10(2), 11(2), 12(2), 13(7), 14(5), 16(3), 18(2,), 18(3), 19(3), 20(3), 23(8), 14(6), 16(3), 18(2,), 18(3), 19(3), 20(3), 24(5), 26, 28(6), 29(6), 30(3), 31, 32, 33, 23(8), 24(5), 26, 28(6), 29(6), 30(3), 31, 34 and 35, which shall apply immediately 32, 33, 34 and 35, which shall apply following the entry into force of this immediately following the entry into force Regulation. of this Regulation. ______* OJ please insert date: 18 months after entry into force of this Regulation.

Or. en

PR\895737EN.doc 49/51 PE485.888v01-00 EN EXPLANATORY STATEMENT

Introduction

The review of the Markets in Financial Instruments Directive (MiFID) has to be seen in the context of EU’s reaction to the financial crisis. MiFID I (2004/39/EC) was implemented on 1 November 2007, replacing the Investment Services Directive (ISD). It was supplemented by an implementing regulation (EC No. 1287/2006) and an implementing directive (2006/73/EC).

There are two main reasons why this review is taking place only five years after the implementation of MiFID I: the market situation has changed due to technical progress, new market participants and the development of more complex trading strategies. Moreover, in response to the financial crisis, MiFID needs to be reviewed in order to reduce systemic risk and to ensure financial markets stability as well as adequate investor protection. Therefore, on 20th October 2011 the European Commission proposed a regulation and a directive which together would replace Directive 2004/39/EC.

The European Parliament launched a consultation which gave all interested parties the chance to comment. The 193 responses were published on the Committee of Economic and Monetary Affairs of the European Parliament (ECON) homepage to be fully transparent. Furthermore, your rapporteur has presented three working documents to give an overview of MiFID I and to identify some key aspects of the Commission proposals.

As the MiFID review is an important step towards transparent and efficient financial markets in the European Union, your rapporteur welcomes the Commission proposals in general as this was one of the Parliament’s key issues in its resolution of 14 December 2010 on regulation of trading in financial instruments – ‘dark pools’ etc. (2010/2075(INI)). In its resolution the Parliament called inter alia for a further investigation of high frequency trading and the appropriateness of existing transparency requirements for trading venues. Whilst welcoming the Commission’s overall aim to guarantee that all organised trading is conducted on regulated trading venues your rapporteur regrets that the Commission did not take on board one of the main issues of the Parliament’s resolution which was not to introduce a new category of trading venues but instead to adjust the requirements for the execution venues introduced in MiFID I: Regulated Markets (RM), Multilateral Trading Facilities (MTF) and Systemic Internalisers (SI).

Position of your rapporteur

Your rapporteur supports the Commission’s proposal to extend the scope of the MiFID rules, as he is in favour of closing all gaps in the regulatory framework in order not to have parts of the market left unregulated.

Whilst MiFID I differentiated between three categories of organised execution venues - as mentioned above RMs, MTFs and SIs - the Commission is now introducing a fourth category called Organised Trading Facilities (OTF). For all trading venues there are identical pre-

PE485.888v01-00 50/51 PR\895737EN.doc EN and post-trade requirements and nearly identical requirements regarding organisational aspects and market surveillance. The main difference between RMs and MTFs on the one hand and OTFs on the other hand is that for OTFs there is a degree of discretion over how a transaction should be executed. Your rapporteur questions whether the creation of a new category is the right way to capture organised venues which are not caught by the already existing categories. In order not to create new loopholes he proposes to limit the OTF category to non-equities. Furthermore, your rapporteur proposes to define "bilateral" and "multilateral" system more clearly in order to achieve a precise distinction between bilateral and multilateral trading and to ensure that market participants are subject to the proper rules.

Your rapporteur notes the provisions on access to market infrastructure. He believes that such access could give rise to problems through liquidity fragmentation, or if interoperability were involved, and that supervisors therefore need to be able to intervene to prevent these problems materialising, as was recognised in EMIR.

Pursuant to the MiFIR proposal, requirements for pre- and post-trade transparency should be extended also to equity-like products and non-equities. As your rapporteur is in favour of measures which increase transparency he supports this approach and only adjusts the possibility for waivers for non-equities. The Commission's proposed obligations in relation to transaction reporting obligation to competent authorities include a new requirement for RMs, MTFs and OTFs to keep data on orders so that it is accessible to supervisors for at least 5 years. Your rapporteur welcomes these proposals.

According to the Commission, competent authorities could set permanent bans or restrictions on financial products or activities or practices coordinated by ESMA. Furthermore, ESMA can temporarily ban or restrict products, practices and services. Your rapporteur questions whether the possibility to ban products or services only ex-post is enough to ensure financial market stability or investor protection and therefore proposes two additions. First, ESMA or competent authorities should not only monitor financial instruments but additionally investment products which also include structured deposits. Second, in addition to the possibility to impose bans or restrictions on products which have already been marketed, ESMA or competent authorities should also be able to impose restrictions or prohibitions on a precautionary basis before an investment product or financial instrument is placed on the market. Furthermore, ESMA and competent authorities should give notice if they intend to ban an investment product or financial instrument on a precautionary basis so that changes to the respective instrument or product can be made within a certain time limit.

Finally, your rapporteur reduces the number of delegated and implementing acts, as he considers that the major political decisions have to be taken within the ordinary legislative procedure by Parliament and Council, and specifies the periods for ESMA to draft the requested regulatory standards.

PR\895737EN.doc 51/51 PE485.888v01-00 EN

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