Position Paper and Technical Analysis on “Non-discriminatory” Access for ETDs

The EU27’s current political reflections on key initiatives, such as the future of the Capital Markets Union or the international role of the Euro, are an indication of the need to have fully operational, stable and independent market infrastructures to support the financing of their economies through their capital-raising and risk-management functions.

“Non-discriminatory” Access provisions under MiFID II/R for Exchange-Traded Derivatives (ETDs) constitute a key risk to EU27 financial stability and competitiveness. Though the provisions intended to bring greater competition to European markets such a policy, in relation to ETDs, would result in fragmentation and significant financial stability risks. Against the background of such risks, orderly market and contract integrity concerns, unfair competition, a lack of global reciprocity – and important political priorities in the financial services sphere – a permanent exclusion of ETDs from the “Non-discriminatory” Access provisions under MiFID II/R is necessary to support the EU27’s financial stability agenda and to ensure its competitiveness at global level. Moreover, the scope of MIFIR Article 37 should be revised and aligned with EMIR in relation to the requirement for licences to be made available.

FESE’s full position and key proposals are available in this page while the accompanying Technical Analysis (available here), provides detailed scenarios to illustrate the issues raised by “Non-discriminatory” Access in respect of specific and concrete market examples.