August 5, 2020

Volume X, Number 218

August 05, 2020

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August 04, 2020

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August 03, 2020

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ESMA Publishes Statement on MiFIR Tick-Size Regime and COVID-19

On March 20, the European Securities and Markets Authority (ESMA) published a statement setting forth its approach to mitigate the impact of COVID-19 on the implementation of the tick-size regime for systematic internalizers (SIs) in EU financial markets under the Markets in Financial Instruments Regulation (MiFIR) and the Investment Firms Regulation (IFR) (the Statement).

In the Statement, ESMA notes that, in these exceptional circumstances, it will be difficult for SIs to comply with the new tick-size regime by March 26, 2020 (which was the deadline) and compliance with the new regime may in fact cause unintended operational risks. Consequently, ESMA does not expect EU financial regulators to prioritise supervisory actions relating to the new tick-size regime from March 26, 2020 until June 26, 2020. Furthermore, in the Statement, ESMA states that EU financial regulators should apply their risk-based supervisory powers in their day-to-day enforcement of applicable legislation in this area in a proportionate manner.

ESMA acknowledges the importance of a timely implementation of this new tick-size regime to ensure a level-playing field throughout the EU markets. However, it also emphasizes that, on its own initiative, the relevant implementing measure has been amended in the past to ensure that SIs observe the tick-size regime up to standard market size.

The Statement is available here.

©2020 Katten Muchin Rosenman LLPNational Law Review, Volume X, Number 87

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About this Author

John Ahern, Financial Attorney, London, Katten Law Firm
Partner

John Ahern, partner at Katten Muchin Rosenman UK LLP and head of the London Financial Services group, focuses his practice on banking, financial services, UK and European financial markets, and related regulations. His background in private practice and as in-house counsel at a global investment bank provides him with perspective on the unique regulatory issues facing the wholesale and private banking sectors. John advises multilateral trading facilities, broker-dealers and banks on trading, clearing and settlement as well as custody of securities—both physical and...

+44 (0) 20 7770 5253
Carolyn H. Jackson, International Attorney, Katten Muchin law firm
Partner

Carolyn Jackson is a partner in Katten Muchin Rosenman UK LLP and is a Registered Foreign Lawyer. She provides US financial regulatory legal advice to a broad range of market participants, including commercial banks, investment banks, investment managers, broker-dealers, electronic trading platforms, clearinghouses, trade associations and over-the-counter derivatives service providers.

Carolyn guides clients in the structuring and offering of complex securities, commodities and derivatives transactions and in complying with US securities and commodities laws and regulations. 

+44 0 20 7776 7625
Nathaniel Lalone, Katten Muchin Law Firm, Financial Institutions Attorney
Senior Associate

Nathaniel Lalone, a partner at Katten Muchin Rosenman UK LLP, has a broad range of experience in the regulation of financial products and financial markets, and frequently provides regulatory and compliance advice to trading venues, clearing houses and buy-side firms active in the over-the-counter (OTC) derivatives, futures and securities markets. He is actively involved in advising clients on the implementation of MiFID 2 and MiFIR in the European Union as well as the international reach of US financial services regulation. He also has significant experience with structuring...

+44 0 20 7776 7629
Neil Robson, private equity fund managers counselor, Katten Law Firm, London
Partner

Neil Robson, a regulatory and compliance partner with Katten Muchin Rosenman LLP, focuses his practice on counseling hedge and private equity fund managers and other investment advisers on operational, regulatory and compliance issues. He regularly addresses Financial Conduct Authority (FCA) and EU authorization and compliance under both the EU Alternative Investment Fund Managers Directive (AIFM Directive) and MiFID, cross-border issues in the financial services sector, market abuse, anti-money laundering and regulatory capital requirements, formations and buyouts of...

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