Authors: Karen Cooper, James Morris

ESMA report proposes changes to scope of MiFID II algorithmic trading and DEA licensing requirements

On 29 September 2021, ESMA published its long-awaited MiFID II review report on algorithmic trading. The report concludes that no fundamental issues have emerged with respect to the algo regime which has overall delivered on its objectives. However, ESMA has made some recommendations to simplify the regime and make it more efficient. This includes proposals to capture OTC trading by SIs within the definition of algorithmic trading and subjecting SIs to some of the relevant governance, systems & controls and notification requirements.