MiFID II (the second Markets in Financial Instruments Directive) and MiFIR (the Markets in Financial Instruments Regulation) came into effect on 3 January 2018.
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MiFID II (the second Markets in Financial Instruments Directive) and MiFIR (the Markets in Financial Instruments Regulation) came into effect on 3 January 2018.

MiFID II and MiFIR together govern all aspects of the financial markets, including trading and reporting of financial instruments.  Transaction reporting obligations are a large part of the regulatory regime and are contained in MiFIR. TRAction provides a full-service MiFIR solution that can simplify your transaction reporting requirements. Contact us if you would like to discuss your transaction reporting obligations.

The scope of MiFID II is broader than MiFID I transaction reporting which only applied to financial instruments admitted for trading on a regulated market (and to OTC derivative contracts and other financial instruments linked to those instruments).

MiFIR Reportability Assessment Tool

Are you unsure if you have MiFIR reporting obligations? TRAction has developed an assessment tool to help you determine your MiFIR reportability.

Transaction Reporting Obligations

As transaction reporting obligations are contained in the MiFIR regulation, there cannot be differing implementation between European nations. MiFIR imposes transaction reporting obligations in respect of specified transactions in financial instruments where the underlying instrument is traded on a European Economic Area (EEA) trading venue.

Which instruments are caught by the new regulations?

The scope of the MiFIR reporting regime includes:

  • financial instruments admitted to trading or traded on an EEA trading venue or for which a request for admission to trading has been made;
  • financial instruments where the underlying financial instrument is traded on a trading venue (ToTV) (guidelines state ‘underlying’ means immediate underlying instrument rather than ‘ultimate’ underlying instrument).
  • financial instruments where the underlying instrument is an index or a basket composed of financial instruments traded on a trading venue.

What is a trading venue?

Under MiFID II/MiFIR, there are 3 categories of trading venue:

  1. Regulated Market
  2. Multilateral Trading Facility
  3. Organised Trading Facility

Do you know the difference? Find it out in our explanatory infographic designed for you!

Which entities need to report?

MiFIR transaction reporting obligations extend to:

  • investment firms;
  • investment managers providing advice and portfolio management to individuals;
  • credit institutions;
  • market operators;
  • all financial counterparties under EMIR;
  • central counterparties and persons with proprietary rights to benchmarks; and
  • third-country firms providing investment services or activities within the EEA.

What information needs to be reported?

There are 65 reporting fields under MiFIR, including:

  • Identification of the relevant parties – the legal entity, natural person or algorithm which submitted the order, made the investment decision or executed the order.
  • Identifying information – a Legal Entity Identifier (LEI) for legal entities and personal identification information for natural persons.
  • Product classification and identification – CFIs and ISINs for financial products.

Where should reports be made?

Firms can report directly to their National Competent Authority (NCA), or indirectly through an Approved Reporting Mechanism (ARM) or a third-party assisted reporting solution.

Delegated Reporting – How can we help you?

TRAction can provide you with delegated reporting solutions in accordance with the reporting requirements outlined above. We assist with understanding your MiFIR transaction reporting obligations and simplify your reporting process. If you want to find out more about our services, please contact us. Wondering about how much we charge? See our pricing schedules here.

Reporting Quality Checks

Our clients can also conduct regular check of our service quality. Visit our Regular Quality Checks page to find out how you can be assured that we are doing a great job for you.

Transitioning to new EMIR and MiFIR Reporting

Thinking of changing your current regulatory reporting service? Transitioning to a new regulatory reporting service can seem daunting. We understand the stress clients may face when switching to another TR, ARM or reporting delegate.

TRAction is here to make this process as easy as possible for you. We’ve worked extensively with other TRs and ARMs. Whether you are transitioning between TRs/ARMs or just looking to switch your reporting delegate, TRAction will ensure it is a smooth process and will help you manage the transition without hassle. Find out why you should make the transition to TRAction.

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Further Information

Understanding your reporting obligations and determining whether a third party reporting solution will save you costs and internal resources are important steps towards compliance with your trade and transaction reporting requirements. Choosing a strategic approach to compliance will give you a competitive advantage and ensure you avoid penalties for non-compliance. To make things easy, we’ve created the Ultimate Guide to Transaction Reporting in Europe. Read more.

TRAction has outlined the key differences between MiFIR and EMIR. Our team has also pointed out some of the issues that investment firms need to be aware of under EMIR and MiFIR, so that you can stay compliant with the trade/transaction reporting requirements. Read more.

As a delegated reporting service provider, TRAction is asked a lot of questions regarding EMIRMiFIR and SFTR reporting. That’s why our team has put together some of our most frequently asked questions, so that you can learn how to seamlessly report transactions under multiple regimes. Read more.

We’ve identified the 3 most common errors in the transaction data we receive from our clients:

  1. Missing customer details
  2. Duplicate transactions
  3. Incorrectly formatted dates

Read more for our guidelines on how to prevent and rectify these errors.

While EMIR and MiFIR trade and transaction reporting rules allow reporting entities to delegate their reporting obligations to a third party, they remain ultimately responsible for ensuring the details of their transactions are reported correctly and accurately under Art 9(1) of EMIR & Art 26(7) of MiFIR. Read more.

As part of MiFIR/UK MiFIR, Investment Firms should have arrangements in place to regularly reconcile their front office transactions against data samples provided by their National Competent Authority (NCA). 

If your NCA does not have samples to provide, as an Investment Firm you should look to reconcile against files that your ARM or Trading Venue has submitted on your behalf, for example, the handback files from your ARM. Read more.

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

Determining how to make the reports and how to populate these fields is often not a straightforward exercise due to differences in licensing and reporting definitions, as well as certain field criteria being conditional on the input of other fields. TRAction’s co-CEO, Quinn Perrott, considers three of these fields in turn. Read more.

Articles 6, 10, 20 and 21 of MiFIR require European Investment Firms (IFs) to make public, through an Approved Publication Arrangement (APA), post-trade transparency information in relation to financial instruments which are traded on a Trading Venue or traded over-the-counter (OTC)/off exchange.

The obligation only requires one counterparty to report the trade data. Read more.