How to reduce MiFID II/MiFIR transaction reporting costs in UK and Europe?

We all know that meeting all the requisite trade/transaction reporting obligations for EMIR and MiFID II/MiFIR can pose a considerable cost to an investment firm.

Firstly, determining your reporting obligations requires allocation of internal resources and/or engagement of external consultants to analyse the application of the regulations to your firm. Where you are potentially subject to multiple reporting regimes or operate across jurisdictions, the analysis may become very complex. Reporting of trade/transaction information itself also comes with costs. While the regulatory burden is not going to disappear, it can be minimised by outsourcing and choosing the most cost-effective and efficient option for you.

TRAction compares the difference between you reporting directly to ARM/TR and through a delegated third party in the following aspects:

  1. Internal Resources
  2. Infrastructure
  3. ARM and TR Fees

Traditional approach - Reporting directly

Investment firms choosing to reporting their trades/transactions under EMIR and MiFIR often face the following challenges:

1. Internal Resources

Meeting the reporting requirements may require re-training existing staff or hiring additional staff. The former can divert human resources from existing projects and the latter adds to employment expenses.

2. Infrastructure

Firms need to spend time and resources to develop ways of generating transaction reports in the correct formats. This in addition to the procurement and storage of all the required data.

3. ARM and Trade Repository Fees

Firms can directly engage with an Approved Reporting Mechanism (ARM) or a Trade Repository (TR) for MiFIR and EMIR respectively. Charges are generally a fixed monthly or annual account fee plus a per-transaction charge.

Efficient approach - Reporting through a delegated third party

Outsourcing your reporting obligations to a specialised trade reporting provider can result in the following cost savings:

1. Internal Resources

Free up your internal resources and allow your team to focus on delivering your core offering/service.

2. Infrastructure

Limit the infrastructure expenditure you incur. We have IT specialists who can work with your IT team to adjust your systems to be reporting-ready, again without additional charge.

3. ARM and Trade Repository Fees

We charge you the similar fees as you would incur if reporting directly to a TR or ARM. What’s more, we provide complimentary advisory and consulting services to unwind the complexity of the EMIR, MiFIR/MiFID II, as well as SFTR, and Best Execution regimes for you and answer all your regulatory questions.

If you think TRAction may be able to help you minimise your trade/transaction reporting costs, have a look at what we offer, our pricing and contact us for a demo.

UK & Europe Trade Reporting - MiFID II

MiFID II extends the derivative transaction reporting obligations of MiFID to a larger group of businesses. Read More

UK & Europe Trade Reporting - EMIR

EMIR requires all market participants to report details of all derivative contracts (interest rate swaps, FX, credit, equity and commodity) to Trade Repositories. Read More

Australia Trade Reporting - ASIC

Find out more about the requirements for Australian OTC derivatives reporting under the ASIC regime. Read More

Singapore Trade Reporting - MAS

Find out more about the requirements for Singaporean OTC derivatives reporting under the MAS regime. Read More

Hong Kong Trade Reporting - HKMA

The Hong Kong Monetary Authority (HKMA) requires specified OTC derivative transactions to be reported to HKTR. HKMA reporting obligations in relation to retail OTC Derivatives will come into effect from 1 July 2017. Read More