NSA response to the proposal from the EC to amend MiFID 2 Delegated Regulation on SI definition

July 21, 2017

On 20 June 2017, the Commission published a proposal with a 4 week consultation period to amend Delegated Regulation (EU) 2017/565 with the purpose to clarify the precise scope of the definition of "systematic internaliser" to ensure uniform application of this term and avoid circumvention.  The Commission’s focus is to restrain the increasing OTC trade in equities within the so-called Brokers Crossing Networks (BCN), which in their essence are OTC dark pools.

 However, the proposal is not targeted towards this concrete challenge; it is much wider in scope, which may lead to unintended consequences i.e. less efficient markets for all instruments.

 In order to accommodate a more targeted approach, the NSA has provided a concrete proposal for amendment, which can be found on page 3.