Deutsche Börse, together with the European Trade Repository REGIS-TR, is helping clients to meet regulatory requirements under the new MiFID II European financial directive.
REGIS-TR is jointly run by Deutsche Börse’s subsidiary Clearstream and Iberclear (BME Group). The Markets in Financial Instruments Directive (MiFID II) will enter into force in 2017.
Deutsche Börse is offering clients two services here: firstly, the MiFID II Transaction Reporting Service, which enables clients to submit the relevant data (e.g. executing trader and reason for transaction) to the national competent authorities. This data must be reported through a so called “authorised reporting mechanism” (ARM). REGIS-TR will apply for ARM status and act as the ARM for Deutsche Börse.
Secondly, Deutsche Börse’s MiFID II OTC Trade Reporting Service is an efficient and straightforward option for clients to meet the transparency requirements for OTC transactions under the new directive. Transactions subject to these requirements will undergo quality assurance and be published in real time via an “approved publication arrangement” (APA). Deutsche Börse will be applying for APA status as soon as the competent authority begins accepting registrations. The reported trade information will be disseminated worldwide via Deutsche Börse's data feeds.
Deutsche Börse provides market participants and supervisory authorities with a forum for exchanging information in the form of regular working groups on MiFID II/MiFIR in Frankfurt, London and Paris. This allows requirements to be addressed in a timely manner by regulators and clients, and solutions to be developed jointly.
MiFID II will have a significant impact on European financial markets, along the entire process chain. While MiFID I only applied to shares, MiFID II covers additional instrument classes, such as ETFs, certificates, bonds, structured financial products and derivatives. The objective is to make trading across all asset classes more transparent. For market participants, the challenge will be to collect all the necessary data, report it to the relevant authority on time and display it historically.
Over 1,800 clients around the world are currently using regulatory reporting services provided by Deutsche Börse and REGIS-TR. Of these, over 250 are using the Deutsche Börse MiFID I service and more than 1,300 clients use REGIS-TR for EMIR reporting. The two entities report more than 7,000,000 transactions daily in line with EMIR, and 15,000,000 transactions monthly in line with MiFID I to supervisory authorities in various countries. This also allows reports to be submitted to various regulators and trade repositories, even within a single company. Reporting services for other regulations will continuously be added. Corresponding services for REMIT, FinfraG, Dodd Frank and Securities Finance Transaction Reporting are next in the pipeline.
“Deutsche Börse has already been offering reporting solutions for many years, including for EMIR and MiFID I. With our MiFID II services, we will now also support market participants in meeting challenges posed by the new regulation, from one source,” says Hauke Stars (pictured), member of the Deutsche Börse Executive Board responsible for IT & Market Data + Services. “With a global solution, we enable our clients to keep their costs in check – both acquisition costs as well as the costs of adapting to additional regulatory changes.”
“An integrated reporting offering makes perfect sense,” says Elena Carnicero, CEO of REGIS-TR. “Our services are highly complementary. As a licensed Trade Repository, REGIS-TR is already widely connected to the network of European national competent authorities and was one of the first Trade Repositories to be approved for EMIR. This combined with a mature MiFID I service and value added products and services on top means that together, REGIS-TR and Deutsche Börse are uniquely positioned to be the de facto European regulatory reporting hub. It is very important for our customers to have a trusted partner who can help them meet their regulatory obligations in an efficient and cost-effective manner.”