What changed between the draft committee report and the plenary report

Added:(a) in paragraph 1, the following point (i) is added:

Removed:Regulation (EU) No 600/2014

Added:(h) the scope of multilateral trading.’;

Removed:Article 1 – paragraph 3 – point b a (new), Article 4 – paragraph 6 – point a: (ba) in paragraph 6, point (a) is replaced by the following: / ‘(a) the range of bid and offer prices or designated market-maker quotes, and the depth of trading interest at those prices, to be made public for each class of financial instrument concerned in accordance with Article 3(1), taking into account the necessary calibration for different types of trading systems as referred to in Article 3(2), and the details of pre-trade data, including identifiers for different types of orders or quotes;’;

Added:(b) paragraph 3 is replaced by the following:

Removed:(https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02014R0600-20220101)

Added:‘3. Title V of this Regulation shall also apply to all financial counterparties referred to in Article 4a(1), second subparagraph, of Regulation (EU) No 648/2012 and to all non-financial counterparties referred to in Article 10(1), second subparagraph, of that Regulation.’;

Removed:Amendment provides ESMA with a clear mandate to determine the information to be made public for the different equity and equity-like financial instruments, especially in consideration of the proposal of a pre-trade CTP for shares. Different market practices have been observed in this respect, which make it challenging for market participants to compare pre-trade data.

Added:(c) the following paragraph 7a is inserted:

Removed:Regulation (EU) No 600/2014

Added:‘7a. All multilateral systems shall operate either in accordance with the provisions of Title II of Directive 2014/65/EU concerning MTFs or OTFs, or the provisions of Title III of that Directive concerning regulated markets.

Removed:Article 1 – paragraph 3 – point b b (new), Article 4 – paragraph 6 – point e a (new): (bb) in paragraph 6, the following point is added: / ‘(ea) the minimum size of an order that may be matched using the trading methodology referred to in paragraph 1(a), which shall be determined taking into account international practices and the competitiveness of Union firms, and shall not be higher than twice the standard market size.’;

Added:All investment firms which, on an organised, frequent, systematic and substantial basis, deal on own account when executing client orders outside a regulated market, an MTF or an OTF shall operate in accordance with Title III of this Regulation.

Removed:Empowering ESMA to define the threshold for the use of the RPW. This would provide more flexibility than the COM's proposed rigid threshold at 2x SMS, while achieving the core objectives of the provision, i.e. to increase pre-trade transparency and reinforce the price formation process. ESMA should take into account, and possibly experiment, the potential impact of this measure on elements such as i) market quality, ii) overall liquidity on EU venues, iii) end investors’ outcomes and iv) domestic and international attractiveness and competitiveness of EU capital markets and firms.

Added:Without prejudice to Articles 23 and 28, all investment firms concluding transactions in financial instruments which are not concluded on multilateral systems or systematic internalisers shall comply with Articles 20, 21, 22, 22a, 22b and 22c, of this Regulation.’;

Removed:Regulation (EU) No 600/2014

Added:(2) in Article 2, paragraph 1 is amended as follows:

Removed:Article 1 – paragraph 4 – point d, Article 5 – paragraph 4 – introductory part: ESMA shall publish within seven working days of the end of each calendar month all of the following data:

Added:(a) point (11) is replaced by the following:

Removed:Amendment grants ESMA more time for the publication under this article, as this would provide the necessary time for the supervisor to check records and prepare the publication and avoid possible frequent late publications or publication that need amendments.

Added:‘(11) ‘multilateral system’ means any system or facility in which multiple third-party buying and selling trading interest in financial instruments are able to interact in the system;’;

Removed:Regulation (EU) No 600/2014

Added:(aa) the following point (16a) is inserted:

Removed:Article 1 – paragraph 4 – point e a (new), Article 5 – paragraph 6: (ea) paragraph 6 is deleted;

Added:‘(16a) ‘designated reporting entity’ means an investment firm responsible for making information on transactions public through an APA in accordance with Articles 20(1) and 21(1);’;

Removed:Removing the publication of the mid-month reports by ESMA. The supervisor provided supporting evidence that being close to the 3.75% and 7.75% thresholds does not discourage trading in dark in the following period. Therefore, considering that (i) the mid-month publication does not require the suspension of dark trading (ii) they seem not to fulfil their goal to alert and deter possible future breaches and (iii) this additional publication per month means additional resources are being used for insignificant benefits, paragraph 6 is deleted.

Added:(ab) point (17) is amended as follows:

Removed:Regulation (EU) No 600/2014

Added:(a) in point (a), the following point is added:

Removed:Article 1 – paragraph 4 – point f a (new), Article 5 – paragraph 9 a (new): (fa) the following paragraph is inserted: / ‘9a. The restrictions of trading under the waivers provided for in Article 4(1)(a) and Article 4(1)(b)(i) in accordance with Article 5, paragraphs (1) to (6), shall be suspended until ... [five years after the date of entry into force of this amending Regulation]. / ESMA shall be empowered to supervise changes to market practices as a result of this suspension, and establish whether the measure unduly harms price formation. To this end, ESMA shall / (a) issue a annual report identifying the percentage of trading in a financial instrument on a trading venue under those waivers; / (b) on the basis of that report, issue an opinion to the Commission assessing the compatibility of the suspension of the trade restrictions under those waivers with price formation and market equilibrium. / Should ESMA indicate that the effect of the suspension is detrimental to both elements, power is delegated to the Commission to reinstate the trade restrictions under the waivers provided for in Article 4(1)(a) and Article 4(1)(b)(i) in accordance with Article 5, paragraphs (1) to (6).’;

Added:‘(iiia) the issuance size for corporate bonds;’;

Removed:Current limits on the amount of trading that can take place without pre-trade transparency are arbitrary, the evidence on their effectiveness in either reinforcing the price formation and redirecting trading flows to lit venues is lacking. Given their ineffectiveness, they place an unnecessary burden on ESMA and market participants, and risk hindering the international competitiveness of EU firms and diminish investors' return. Other measures are better placed to strengthen lit venues (e.g. increased thresholds for the use of the RPW, higher SIs quoting obligation, ban of PFOF). The cap mechanism should thus be suspended, while ESMA continues to monitor the level of dark trading and be empowered to limit it – by restricting the use of the reference price and negotiated trade waivers – if there is evidence that the volume of such trading is undermining the efficiency of the price formation process.

Added:(b) point (b) is replaced by the following:

Removed:Regulation (EU) No 600/2014

Added:‘(b) for the purposes of Articles 4, 5 and 14, a market for a financial instrument that is assessed according to the following criteria:

Removed:Article 1 – paragraph 4 a (new), Article 8: (4a) Article 8 is replaced by the following: / ‘1. Market operators and investment firms operating a trading venue shall make public current bid and offer prices and the depth of trading interests at those prices which are advertised through their systems for bonds, structured finance products, emission allowances, derivatives traded on a trading venue and package orders. Those market operators and investment firms shall make that information available to the public on a continuous basis during normal trading hours. That publication obligation does not apply to those derivatives transactions of non-financial counterparties which are objectively measurable as reducing risks directly relating to the commercial activity or treasury financing activity of the non-financial counterparty or of that group. / 2. The transparency requirements referred to in paragraph 1 shall be calibrated for central limit order book and periodic auction systems only. / 3. Market operators and investment firms operating a trading venue shall give access, on reasonable commercial terms and on a non-discriminatory basis, to the arrangements they employ for making public the information referred to in paragraph 1 to investment firms which are obliged to publish their quotes in bonds, structured finance products, emission allowances and derivatives pursuant to Article 18.'; / (deleted)

Added:(i) the market capitalisation;

Removed:(https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02014R0600-20220101)

Added:(ii) the average daily number of transactions in those financial instruments, in particular, the fact that a financial instrument is traded daily;

Removed:Market participants across the buy- and sell-side have consistently reported that the pre-trade transparency regime for RFQ and voice systems is of negligible added value to end users in fixed income markets. This has also been informally recognised by supervisors. The removal of these requirements, together with the introduction of the CT, will remove an undue burden on market participants without affecting the levels of transparency in the market. Same principle apply for changes to Article 18. Amedments also deletes paragraph 4, in line with COM deletion of SSTI.

Added:(iii) the average daily turnover for those financial instruments;’;

Removed:Regulation (EU) No 600/2014

Added:(b) the following point (34a) is inserted:

Removed:Article 1 – paragraph 5 – point a, Article 9 – paragraph 1: (a) in paragraph 1, points (b) and (e)(iii) are deleted;

Added:‘(34a) ‘market data contributor’ means a trading venue, an APA, or, for the purpose of pre-trade transparency for shares, an investment firm, operating a systematic internaliser;’;

Removed:To be removed consistently with the COM proposed removal of the pre-trade SSTI waiver.

Added:(c) point (35) is replaced by the following:

Removed:Regulation (EU) No 600/2014

Added:‘(35) ‘consolidated tape provider’ or ‘CTP’ means a person authorised in accordance with Title IVa, Chapter 1 of this Regulation to provide the service of collecting market data ▌from market data contributors, and of consolidating those data into a continuous electronic live data stream providing regulatory data and core market data ▌and of providing them to user of market data;’;

Removed:Article 1 – paragraph 6, Article 11: deleted / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted)

Added:(ca) point (36a) is replaced by the following:

Removed:Regulation (EU) No 600/2014

Added:‘(36a) ‘data reporting services provider’ means a person referred to in points (34), (35) and (36) and a person referred to in Article 27b(2);’;

Removed:Article 1 – paragraph 6 a (new), Article 11: (6a) Article 11 is replaced by the following: / ‘Article 11 Authorisation of deferred publication / 1. Market operators and investment firms operating a trading venue may defer the publication of the details of transactions, including the price and the volume, until the end of the trading day. The publication of the volume of very large transactions may be deferred for an extended period not exceeding four weeks. / (deleted) / (deleted) / (deleted) / Market operators and investment firms operating a trading venue shall clearly disclose proposed arrangements for deferred trade-publication to market participants and the public. ESMA shall monitor the application of those arrangements for deferred trade-publication and shall submit an annual report to the Commission on how they are used in practice. / The arrangements for deferred trade-publication shall be organised using the following five categories of transactions related to a bond, structured finance product, emission allowance or derivative traded on a trading venue, or a class of bond, structured finance product, emission allowance or derivative traded on a trading venue: / (a) category 1: transactions of a medium size in a financial instrument for which there is a liquid market; / (b) category 2: transactions of a medium size in a financial instrument for which there is not a liquid market; / (c) category 3: transactions of a large size in a financial instrument for which there is a liquid market; / (d) category 4: trans…

Added:(d) the following points (36b) ▌, (36c) and (36d) are inserted:

Removed:(https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02014R0600-20220101)

Added:(36b) ‘core market data’ means:

Removed:Overhaul of Article 11, harmonizing the deferral periods for non-equities across the Union, in light of the fact that the current regime has resulted in limited post-trade transparency. Including different categories of deferrals based on the transaction size and the liquidity of the instruments. In the proposal, price can be deferred maximum until the end of the day for all transactions until very large ones - this should increase transparency and be beneficial for the CT. Longer deferrals (4 weeks) for very large transactions are introduced, to allow market makers enough time to manage their risks. It should be noted that the only evidence available from the implementation of well calibrated, yet ambitious deferrals regime in other jurisdictions points towards the fact that shorter deferrals have a positive impact on the spreads and are generally beneficial for market participants - while the impact on liquidity providers has been limited. Nonetheless, recognising the time it takes to unwind very large positions on certain instruments, longer deferrals for volumes, as well as a specific category for very large transaction may be warranted. Finally, paragraph 3 is also modified to avoid heterogeneous deferral regimes across MS in a given sovereign debt instrument. Given that proposed Art. 11 seeks to harmonise the regime for corporate bonds the current approach for sovereign bonds, where the NCAs allow (but do not mandate) the extended deferrals for sovereigns trading on venues within their jurisdiction is neither achieving the original objectives of the member states nor creating a harmonised approach. The better approach is to have each member state issuers determine the deferral regime for their own bonds which should be applied across the union.

Added:(a) all of the following data on equities:

Removed:Regulation (EU) No 600/2014