ESMA Sets the Stage for MIFIR RTS 22 Changes
ESMA’s MIFID Review reached the MIFIR RTS 22 Transaction Reporting part of the regulation with the issue of a Consultation Paper (link) on October 3rd. Approved in March of this year, the MIFID Review is a wide-ranging engagement by ESMA to revamp MIFID regulation with changes starting in September 2025. The review takes into account industry feedback, alignment with other regulations and ESMA’s overall internal analysis of data quality and governance of the existing MIFID II/MIFIR framework that went live in January 2018.
For regulations with a reporting framework that includes Regulatory Technical Standards (RTS), ESMA began issuing Consultation Papers (CPs) of proposed changes with feedback used to issue Final Drafts of the update. After a number of initial RTS CP’s, the latest one issued covers proposals for RTS 22.
According to the CP, following the deadline of feedback by January 3rd, 2025, ESMA expects to issue a Final Report of the RTS update sometime in Q1 of 2025. For the go-live, ESMA stated that the date should “ensure sufficient time for implementation” which they added would ideally be 12 months from the time the release documentation of final technical standards.
What’s changing?
The proposal covers changes to the scope of products reportable under the regulation, proposed new fields, amendments to existing ones and removal of a few fields. Many of the changes are related to aligning reported data and values to those of EMIR REFIT so that products reportable under both regulations include similar economic dates. This latter point is important as with the EMIR REFIT go-live in April, industry groups have flagged to ESMA various inconsistencies of field definitions and approaches to reporting various products that are different between MIFIR and other regulations.
Field Updates
The CP is a combination of proposals of new fields and amendments and removal to existing ones. Proposed changes include:
New Fields
- Effective Date/Reporting Timestamps: Adding these fields to align with EMIR REFIT and SFTR
- Identifiers: Proposal includes new fields of Trading Venue Transaction Identification Code (TVTIC) for non-EEA venues and fields for entering identifiers of chains of aggregated orders. The latter being similar to Package Identifier Code under EMIR.
- Client identifiers: New fields for better defining non-entity counterparties and entity subject to reporting obligation
- DLT Identifiers: Will allow firms to enter Token Identifiers that will exist under MICA Cryptocurrency Regulation when it becomes relevant in the future.
Existing Fields
Small changes to allow for new values and all existing values remain valid
- Net Amount (field 35)
- Buyer/Seller (field 7/16)
- Executing Entity (field 4)
- Underlying instrument code (field 47)
- Transmission of order indicator (field 25)
- Execution within firm (field 59)
Values changed to align with EMIR or other MIFID reports
- Waiver indicator (field 62)
- OTC post-trade indicator (field 63)
Field being removed
- Short selling indicator
Scope
ESMA is also adapting the scope of the regulation. While the core Trading on a Trading Venue (TOTV) approach will continue, a few adaptions are being made.
As indicated above, ESMA is taking into account that MICA regulation will broaden crypto products that become obligated to be traded on trading venues and will thereby fall under scope of RTS 22 reporting.
Also, ESMA is proposing to include some OTC FX, IRS and CDS products to be reported of EUR, JPY, GBP and USD denominated derivatives. They are listed under Article 8a 2 and are primarily centrally cleared and/or fall under clearing obligation requirements (link).
Next Steps
Like any CP, the next stage awaits industry feedback to ESMA’s proposals for RTS 22. Beyond the big question of how much of the proposal does ESMA finalize to push forward, is what will be the go-live date for these changes?
Also, it is worth noting that these updates are from ESMA, and the UK’s FCA is reviewing MIFID as part of their wider review of reporting regulations and could lead to wider diversion between UK and EU MIFIR reporting.
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