The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, reminds market participants that the new regime for the reporting of Over the Counter (OTC) transactions for post-trade transparency purposes becomes fully operational on 3 February 2025. ESMA also informs stakeholders that the quarterly publication of systematic internalisers (SI) data will be discontinued with immediate effect.
Following the MiFIR review, the responsibility for reporting OTC-transactions will shift from SIs to the new Designated Publishing Entities (DPEs). The old approach has led many investment firms to opt in to the status of SI to be able to report the trades for their clients. When these firms were not dealing on own account on a systematic basis this added disproportionate requirements to them.
The DPE regime (see ESMA’s Public Statement) allows National Competent Authorities (NCAs) to grant the status of DPE to investment firms. DPEs, when they are party to a transaction, will need to make these transaction public through an approved publication arrangement (APA).
ESMA maintains a public register of DPEs by class of financial instruments, to help market participants to identify those entities.
Discontinuation of the SI quarterly calculations
Following the application of the MiFID II amendments, it will no longer be necessary for ESMA to perform SI calculations from September 2025. In view of the resources needed to perform the calculations and the fact that the regime will end shortly, ESMA has decided to discontinue the voluntary publication of quarterly SI calculations data already now. This action will also reduce the administrative burden for investment firms.
Consequently, the mandatory SI regime will no longer apply from 1 February 2025, and investment firms will not need to perform the SI-test. However, investment firms can continue to opt into the SI-regime.
