MiFID introduced the obligation for intermediaries to report information to the authorities on transactions concluded on their own behalf and on behalf of clients. Transaction reporting is to ensure that they are operating in a fair and professional manner, one that is able to strengthen market integrity.
In particular, the requirements concerning transaction reporting, provided under art. 25 of MiFID, are applicable to any transaction whose object is a financial instrument listed on a regulated market, regardless of the fact whether the transaction is concluded.
In Italy, the transaction reporting system was put into effect on 1 November 2007 and, a year from its start, intermediaries have noted its proper functioning.
• MiFID: One Year On
Conference in Brussels, 13 November 2008
Summary of discussion >>
• CESR call for evidence on the review of the scope of MiFID Transaction Reporting Obligation
After MiFID came into force on 1 November 2007, the CESR issued guidelines concerning the transaction reporting requirement. They were recently reviewed by the CESR, which asked market participant for their views and opinions on the functioning of the current transaction reporting system.
The collaboration between market operators and the Italian Authority led to establishing an efficient national transaction reporting system in Italy; hence no specific modifications need to be made thereto. For this reason, the common position of the Italian banking system is that there is no need for the guidelines on the matter to be revised by the CESR.
ABI Position
(05/12/08)
Specifically, ABI believes that the current sphere of application of the transaction reporting requirements - which provides for reporting transactions carried out directly with the market and transactions carried out on the intermediaries’ own behalf - is sufficient for the purposes of transaction reporting. We believe moreover that any information relating to the identification of the ultimate client, currently outside of the scope of the reporting requirements, may be requested by the authorities and concerns ad hoc information with reference to individual transactions. full text >>
• CESR’s consultation on the impact of MiFID on secondary markets’ functioning
One year on, CESR has consider important to conduct an internal evaluation of the workings of the new regulatory framework provided by MiFID and its impact on market structure and in particular on equity secondary markets functioning. The analysis focuses on the functioning of the MiFID provisions and the related provisions of the MiFID Implementing Regulation in the following areas:
• Market transparency and integrity;
• Regulated markets;
• Multilateral Trading Facilities;
• Systematic internalisers.
ABI position
(12/12/ 2008)
ABI considers that the MiFID directive, which was implemented only one year ago, has not yet delivered its expected benefits in terms of competition between trading venues.
The Association believes that it’s still too early to make final remarks on whether MiIFID has delivered its expected results with regard to the secondary stock market. Over the past year, since MiFID was implemented, intermediaries have basically invested significant resources for its implementation but have not yet enjoyed any real benefits.
While some innovative trends highlighted, these weren’t so homogeneous among European countries. Specifically, in Italy this is probably due to the fact that the previous regulatory regime, which set out that shares had to be traded on regulated markets (so called concentration rule), made it difficult for new trading venues to emerge, even after the prior regime was abolished.
Competition between trading venues (both in terms of number of alternative trading venues and in terms of diversification of shares traded) is still not significant and the majority of financial instruments are still traded on the main market.
A significant decrease in trading costs is expected (and desired) in the future, when European MTFs on which Italian shares are traded will be fully operational. This decrease in costs, however, may be partly offset by investments made (in IT and resources) and costs incurred by financial intermediaries to access such new alternative trading venues. Full text >>