The European Banking Federation (FBE) issued its comments on the first revised version submitted to ESC on transparency and admission to trading of the MIFID Directive.
FBE criticizes among others that the definitions in the Working Document need to be clear and precise. The definition of negotiated transaction needs to be revised to reflect the fact that clients of members or participants of a regulated market or an
MTF may also undertake those negotiated transactions and such transactions are within the rules of the regulated market or MTF.
The new concept of systematic internaliser needs to be as clear as possible in order to set the borders of pre-trade transparency obligations clearly and to ensure that there is legal certainty for firms. However, the criteria proposed by the Commission are not yet precise enough and thus leave the definition open-ended. FBE proposes a clear positive definition of systematic internaliser.
FBE also urges the Commission to consider a figure higher than EUR 1 billion EUR or to go back to CESR proposal for the free float parameter, which is much more appropriate than the figure of 500 million EUR proposed by the Commission. Since free float can vary vastly from actual trading, it can be seen as only an indirect indication of liquidity.
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