FESE response to the ESMA consultation on the MiFIR Review – RTS 2 Transparency for bonds, SFP and EUA

FESE welcomes the MiFIR objective to “enhance and improve pre- and post-trade transparency in non-equity markets” by improving, simplifying and further harmonizing transparency in capital markets.

• FESE would like to stress that it fully supports ESMA’s approach in making sure that around 90% of total volumes and number of transactions would fall under the definition of liquid bonds. We believe that this is a significant improvement with respect to the previous regime.
• As a general comment, we doubt whether static liquidity thresholds will reflect the reality of the market as securities do not have constant liquidity and it changes based on market tendencies in various Member States over the years. Nevertheless, FESE appreciates that the new system should not be overly complicated and that it needs to reflect the new wording from the Level 1 text.
• FESE believes that ESMA should extend the definition of CLOB to other execution channels that are integral parts of the same system as the CLOB and thus, form a hybrid trading system of the exchange. The assessment of whether such other execution channels are integral parts of the same system as the CLOB should be based on a holistic basis.