26 Amendments of Billy KELLEHER related to 2021/0385(COD)
Amendment 102 #
Proposal for a regulation
Title 1
Title 1
Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulation (EU) No 600/2014 as regards enhancing market data transparency, removing obstacles to the emergence of a consolidated tape, and optimising the trading obligations and prohibiting receiving payments for forwarding client orders (Text with EEA relevance)
Amendment 110 #
Proposal for a regulation
Recital 6
Recital 6
(6) Article 4 of Regulation (EU) No 600/2014 allows competent authorities to waive the pre-trade transparency requirements for market operators and investment firms operating a trading venue who determine their prices by reference to the midpoint price of the primary market or the most relevant market in terms of liquidity. As there is no justification for excluding the smallest orders from a transparent order book and in order to increase pre-trade transparency and thereby reinforce the price formation process, that waiver should be applicable to orders with a size greater than or equal toof a minimum at twice the standard market size. Further clarifications should be provided by ESMA. Where the consolidated tape for shares and exchange- traded funds (ETFs) will provide bid and offer prices from which a midpoint can be derived, the reference price waiver should also be available for systems deriving the midpoint price from the consolidated tape.
Amendment 115 #
Proposal for a regulation
Recital 7
Recital 7
(7) Dark trading is trading without pre- trade transparency, using the reference price waiver laid down in Article 4(1), point (a) of Regulation (EU) No 600/2014 and the negotiated trade waiver laid down in Article 4(a) point (a), point (i) of that Regulation. The use of both waivers is capped by the double volume cap (‘DVC’). The DVC is a mechanism that limits the level of dark trading to a certain proportion of total trading in an equity instrument. The amount of dark trading in an equity instrument on an individual venue may not exceed 4% of total trading in that instrument in the Union. When this threshold is breached, dark trading in that instrument on that venue is suspended. Secondly the amount of dark trading in an equity instrument in the Union may not exceed 8% of total trading in that instrument in the Union. When this threshold is breached all dark trading in that instrument is suspended. The venue specific threshold leaves room for continued use of those waivers on other platforms on which trading in that equity instrument is not yet suspended, until the Union wide threshold is breached. This causes complexity in terms of monitoring the levels of dark trading and of enforcing the suspension. To simplify the double volume cap while keeping its effectiveness, the new single volume cap should rely solely on the EU-wide threshold. That threshold should be lowered to 7 % to compensate for a potential increase of trading under those waivers as a consequence of abolishing the venue specific threshold. ESMA should be empowered to determine the DVC based on market conditions, the price formation process and liquidity available in the market.
Amendment 127 #
Proposal for a regulation
Recital 11
Recital 11
(11) In order to reinforce the price formation process and to maintain a level playing field between trading venues and systematic internalisers, Article 14 of Regulation (EU) No 600/2014 requires systematic internalisers to make public all quotes in equity instruments placed by that systematic internaliser below the standard market size. Systematic internalisers are free to decide which sizes they quote, as long as they quote at a minimum size of 10% of the standard market size. That possibility, however, has led to very low levels of pre-trade transparency provided by systematic internalisers in equity instruments, and has hampered the achievement of a level playing field. It is therefore necessary to require systematic internalisers to publish firm quotes relating to a minimum of twice the standard market size. ESMA should be empowered to determine the threshold in accordance with Article 4(6) point f.
Amendment 132 #
Proposal for a regulation
Recital 12
Recital 12
(12) In order to create a level playing field, in addition to the obligation to publish firm quotes relating to a minimum of twice the standard market size, systematic internalisers should also no longernot be allowed to match at midpoint below twice the standard market size. It should furthermore be clarified that systematic internalisers should be allowed to match at midpoint in so far as they comply with the tick-size rules in accordance with Article 49 of Directive 2014/65/EU when they trade above twice the standard market size but below the large in-scale threshold. When systematic internalisers trade above a large in-scale threshold, they should continue to be allowed to match at midpoint without complying with the tick- size regime. In order to clarify, ESMA should be empowered to determine the size appropriate for the market conditions.
Amendment 135 #
Proposal for a regulation
Recital 13
Recital 13
(13) Market participants need core market data to be able to make informed investment decisions. Pursuant to the current Article 27h of Regulation (EU) 600/2014, sourcing core market data about certain financial instruments directly from trading venues and APAs requires that consolidated tape providers enter into separate licensing agreements with all those data contributors. That process is burdensome, costly and time consuming. It has been one of the obstacles to consolidated tape providers emerging on a cross market basis. This obstacle should be removed in order to enable consolidated tape providers to obtain the market data and to overcome licencing issues. Trading venues and APAs, or investment firms and systematic internalisers without intervention of APAs (‘market data contributors’) should be required to submit their market data to consolidated tape providers, and to use harmonised templates respecting high–quality data standards to do so. Only CTPs selected and authorised by ESMA should be able to collect harmonised market data from the individual data sources in accordance with the mandatory contribution rule. To make the market data useful for investors, market data contributors should be required to provide the CTP with market data as close as technically possible to real time.no later than one minute after the transaction
Amendment 161 #
Proposal for a regulation
Recital 22
Recital 22
(22) There is an objective difference between a venue of primary admission and other trading venues that serve as secondary trading markets. A venue of primary admission admits companies to the public markets, playing a crucial role in the life of a share and for the share’s liquidity. This is particularly true in the case of shares listed on smaller regulated markets which remain typically traded mostly on the venue of primary admission. When the pre-trade transparent trading of a certain share takes place exclusively or predominantly on the venue of primary admission, such smaller venue plays a more important role in the price formation for that share. The core market data a smaller regulated market contributes to the consolidated tape therefore plays a more determining role in the price formation for the shares this venue admits to trading. A preferential treatment in the revenue participation scheme is therefore considered appropriate to allow these smOn that note, the CT can offer more visibility to the smaller exchanges. Therefore, it is important for aller exchanges to maintain their local admissions and safeguard a rich and vibrant ecosystemcontribute to the tape, which is, moreover, fully in line with the objectivesidea of the Capitinternal Mmarkets Union.
Amendment 163 #
Proposal for a regulation
Recital 23
Recital 23
(23) Small regulated markets are regulated markets which admit shares of issuers for which trading in the secondary market tends to be less liquid than the trading of shares admitted to trading on larger regulated markets. In order to avoid that lower trading volumes (or nominal values) penalise smaller exchanges in the revenue participation scheme designed for the consolidated tape for shares, data from trades in these less liquid shares should attract a higher remuneration than their notional trading value would indicate. Whether a shareThe desired outcome would be to provide end investors with a truly consolidated overview of the trading opportunities available in the Union and to increase the overall domestic and international attractiveness of the Union capital markets, isn less liquid should be determinedine with the objectives onf the basis of the proportion of pre-trade transparent liquidity displayed by the regulated market that admits the less liquid share, Capital Markets Union, and to include small regulated markets in the picture crelative to the average daily trading turnover in that shared by the consolidated tape.
Amendment 172 #
Proposal for a regulation
Recital 32
Recital 32
(32) Financial intermediaries should strive to achieve the best possible price and the highest possible likelihood of execution for trades that they execute on behalf of their clients. To that end,ensure that the best execution requirement described in Article 27 of Directive 2014/65/EU can be met financial intermediaries should select the trading venue or counterparty for executing their client trades solely on the basis of achieving best execution for their clients. It should be incompatible with that principle of best execution that a financial intermediary receives a payment from a trading counterpart in exchange for ensuring the execution of client trades. Investment firms should be therefore be prohibited from receiving such payment.
Amendment 181 #
Proposal for a regulation
Article 1 – paragraph 2 – point c
Article 1 – paragraph 2 – point c
Regulation (EU) No 600/2014
Article 2 – paragraph 1 – point 35
Article 2 – paragraph 1 – point 35
(35) ‘consolidated tape provider’ or ‘CTP’ means a person authorised in accordance with Title IVa, Chapter 1 of this Regulation to provide the service of collecting market data for shares, ETFs, bonds or derivatives, from market data contributors, and of consolidating those data into a continuous electronic live data stream providing core market data per share, ETF, bond or derivatives and of providing them to user of market data;;
Amendment 234 #
Proposal for a regulation
Article 1 – paragraph 3 – point b a (new)
Article 1 – paragraph 3 – point b a (new)
Regulation (EU) No 600/2014
Article 4 – paragraph 6 – subparagraph 1 – point f (new)
Article 4 – paragraph 6 – subparagraph 1 – point f (new)
(b a) in paragraph 6, the following point is added: "(b a) the minimum size of an order that may be matched using the trading methodology referred to in paragraph 1(a), which shall not be lower than twice the standard market size."
Amendment 239 #
Proposal for a regulation
Article 1 – paragraph 4 – point b
Article 1 – paragraph 4 – point b
Regulation (EU) No 600/2014
Article 5 – paragraph 1
Article 5 – paragraph 1
1. Trading venues shall suspend their use of the waivers referred to in Article 4(1), point (a), and 4(1), point (b)(i) where the percentage of volume traded in the Union in a financial instrument carried out under those waivers exceeds 7% of the total volume traded in that financial instrument in the Union as determined by ESMA according to Article 5 (9) of this regulation. Trading venues shall base their decision to suspend the use of those waivers on the data published by ESMA in accordance with paragraph 4, and shall take such decision within two working days after this publication of those data and for a period of six months.;
Amendment 283 #
Proposal for a regulation
Article 1 – paragraph 8 – point a
Article 1 – paragraph 8 – point a
Regulation (EU) No 600/2014
Article 14 – paragraph 2
Article 14 – paragraph 2
2. This Article and Articles 15, 16 and 17 shall apply to systematic internalisers when they deal in sizes up to twiche the standard market sizereshold determined by ESMA in accordance with Article 4(6)(f). Systematic internalisers shall not be subject to this Article and Articles 15, 16 and 17 when they deal in sizes above twice the standard market sizehat threshold.
Amendment 287 #
Proposal for a regulation
Article 1 – paragraph 8 – point a
Article 1 – paragraph 8 – point a
Regulation (EU) No 600/2014
Article 14 – paragraph 3
Article 14 – paragraph 3
3. Systematic internalisers are allowed to quote any size. The minimum quoting size shall be at least the equivalentthe minimum of twice the standard market size of a share, depositary receipt, ETF, certificate, or other financial instrument that is similar to those financial instruments and that is traded on a trading venue. For a particular share, depository receipt, ETF, certificate or other financial instrument that is similar to those financial instruments and that is traded on a trading venue, each quote shall include a firm bid and offer price, or firm bid and offer prices for a size or sizes which could be up to twice the standard market size for the class of shares, depositary receipts, ETFs, certificates or financial instruments that are similar to those financial instruments, to whhe minimum of twiche the financial instrument belongsstandard market size. The price or prices shall reflect the prevailing market conditions for that share, depositary receipt, ETF, certificate or financial instrument that is similar to those financial instruments.;
Amendment 310 #
Proposal for a regulation
Article 1 – paragraph 9
Article 1 – paragraph 9
Regulation (EU) No 600/2014
Article 17a – paragraph 2
Article 17a – paragraph 2
2. The application of the tick sizes set in accordance with Article 49 of Directive 2014/65/EU shall not prevent systematic internalisers from matching orders large in scale at mid-point within the current bid and offer prices. Matching orders at mid- point within the current bid and offer prices below large in scale but above twiche the standard market sizereshold determined by ESMA in accordance with Article 4(6)(f) shall be allowed in so far as those tick sizes are complied with.;
Amendment 313 #
Proposal for a regulation
Article 1 – paragraph 9 a (new)
Article 1 – paragraph 9 a (new)
Regulation (EU) No 600/2014
Article 18
Article 18
(9 a) in Article 18, paragraph 1 is deleted.
Amendment 347 #
Proposal for a regulation
Article 1 – paragraph 10
Article 1 – paragraph 10
Regulation (EU) No 600/2014
Article 22b – paragraph 1
Article 22b – paragraph 1
1. The Commission shall set up an expert stakeholder group by [OP add 3 months as of entry into force] to provide advice on the quality and the substance of market data, the common interpretation of market data and the quality of the transmission protocol referred to in Article 22a(1). TESMA should work closely with the expert stakeholder group which shall provide advice on a yearly basis. That advice shall be made public.
Amendment 349 #
Proposal for a regulation
Article 1 – paragraph 10
Article 1 – paragraph 10
Regulation (EU) No 600/2014
Article 22b – paragraph 2 – first subparagraph
Article 22b – paragraph 2 – first subparagraph
2. The Commission shall be empowered to adESMA should developt delegated acts in accordance with Article 50 to specify the quality and the substance of the market data and the quality of the transmission protocolraft regulatory standards.
Amendment 351 #
Proposal for a regulation
Article 1 – paragraph 10
Article 1 – paragraph 10
Regulation (EU) No 600/2014
Article 22b – paragraph 2 – second subparagraph – introductory part
Article 22b – paragraph 2 – second subparagraph – introductory part
Those delegated actregulatory technical standards shall in particular specify all of the following:
Amendment 353 #
Proposal for a regulation
Article 1 – paragraph 10
Article 1 – paragraph 10
Regulation (EU) No 600/2014
Article 22b – paragraph 2 – third subparagraph
Article 22b – paragraph 2 – third subparagraph
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. For the purposes of the first subparagraph, the Commission shall take into account the advice from ESMA and from the technical expert group established in accordance with paragraph 2, international developments, and standards agreed at Union or international level. The Commission shall ensure that the delegated actregulatory technical standards adopted take into account the reporting requirements laid down in Articles 3, 6, 8, 10, 14, 18, 20, 21 and 27g.
Amendment 360 #
Proposal for a regulation
Article 1 – paragraph 11 b (new)
Article 1 – paragraph 11 b (new)
Regulation (EU) No 600/2014
Article 26 – paragraph 1
Article 26 – paragraph 1
(11 b) in Article 26, paragraph 1, is replaced by the following: "1. Investment firms which execute transactions in financial instruments shall report complete and accurate details of such transactions to the competent authority as quickly as possible, and no later than the close of the following working day. (https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02014L0065-20220228)Following an impact assessment of the European Commission, further alignements to other regulations such as UCITS, AIFMD or EMIR can be advantageous. However, additional reporting and unproportionate requirements shall not be the outcome of such a review. Or. en
Amendment 398 #
Proposal for a regulation
Article 1 – paragraph 15
Article 1 – paragraph 15
Regulation (EU) No 600/2014
Article 27da – paragraph 4
Article 27da – paragraph 4
4. The selection of the CTP for sharebonds shall, in addition to the criteria in paragraph 2, consider the revenue participation scheme, and in particular the formula, applicable to regulated markets that are market data contributors. ESMA shall, when considering the competing tenders, select the CTP for sharebonds that offers the revenue participation scheme that provides regulated markets, in particular smaller regulated markets, with the highest amount of revenue that remains for distribution once deducted operating costs and a small incentivising margin which is deemed appropriate and reasonable margin. This revenue shall be distributed in accordance with Article 27h(1)(c), and in a manner commensurate to the market data contributed according to Article 22a.
Amendment 415 #
Proposal for a regulation
Article 1 – paragraph 16
Article 1 – paragraph 16
Regulation (EU) No 600/2014
Article 27h – paragraph 1 – subparagraph 1 – point c
Article 27h – paragraph 1 – subparagraph 1 – point c
(c) in the case of market data concerning shares, redistribute part of their revenues for the purposes of covering the cost related to mandatory contribution and of ensuring a fairreasonable level of participation for regulated markets, and in particular smaller regulated markets, in the revenue generated by the consolidated tape, in accordance with Article 27da(4);
Amendment 420 #
Proposal for a regulation
Article 1 – paragraph 16
Article 1 – paragraph 16
Regulation (EU) No 600/2014
Article 27h – paragraph 1 – subparagraph 1 – point d
Article 27h – paragraph 1 – subparagraph 1 – point d
(d) make consolidated core market data, for the provision of which the CTP is selected in accordance with Article 27da, available in accordance with the data quality requirements set out in Article 22b to users into a continuous electronic data stream on non-discriminatory terms as close to real time as technically possibleno later than one minute after the transaction;
Amendment 426 #
Proposal for a regulation
Article 1 – paragraph 16
Article 1 – paragraph 16
Regulation (EU) No 600/2014
Article 27h – paragraph 1 – second subparagraph
Article 27h – paragraph 1 – second subparagraph
For the purpose of establishing the participarevenue redistribution in point (c), the revenue of the CTP shall be allocated among regulated markets according to a formula that reflects the proportion of pre-trade transparent liquidity in shares displayed by a regulated market relativcore market data provided while taking into account the ratio of market data revenue to the aoverage daily turnover in these shares in the Unionll revenue within the legal group structure.
Amendment 446 #
Proposal for a regulation
Article 1 – paragraph 26
Article 1 – paragraph 26
Regulation (EU) No 600/2014
Article 39 a (new)
Article 39 a (new)