ESMA_QA_1545

Status: ✅ Answer Published

Link to ESMA Q&A tool: https://www.esma.europa.eu/publications-data/questions-answers/1545

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Regulatory Context

Regulation : MIF2

Level 1 Regulation: Markets in Financial Instruments Directive II (MiFID II) Directive 2014/65/EU- Secondary Markets

Level 2 Regulation: No information available

Level 3 Regulation: No information available

Topic: Position management controls

Subject Matter: Position management controls

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Question

Submission Date: 04 October 2017

Are position management controls required to play a role in the application of position limits applied by NCAs according to Article 57(1) MiFID II?

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ESMA Answer

Answer Date: 04-10-2017

[ESMA 70-872942901-36 Commodity derivatives Q&A, Q&A 5.1] No. NCAs are responsible for the application of position limits established under Article 57(1). Recital (128) MiFID further specifies that the powers to require the reduction or termination of a position or to provide back liquidity should “mitigate the effects of a large or dominant position”. However, the controls listed in Article 57(8) are not exhaustive and shall not prevent trading venues from developing their own position limits as a mean to control positions held on commodity derivatives traded on their trading venues.

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This document was automatically extracted from the ESMA EMIR Q&A database.