ESMA_QA_1604

Status: ✅ Answer Published

Link to ESMA Q&A tool: https://www.esma.europa.eu/publications-data/questions-answers/1604

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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: ESMA70-872942901-38 - Q&A on MiFID II and MiFIR market structures topics

Topic: Direct Electronic Access and algorithmic trading

Subject Matter: Algorithmic trading - OTC trading

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Question

Submission Date: 03 April 2017

Does the MiFID II obligation relating to algorithmic trading apply to electronic OTC trading? Are algorithms that provide quotes/orders to customers subject to the requirements set out in MiFID II?

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ESMA Answer

Answer Date: 03-04-2017

[ESMA 70-872942901-38 MiFID II MiFIR market structures Q&A, Q&A 3.8] Article 17 of MiFID II covers the trading activity that takes place on a trading venue. Therefore, OTC trading activity, such as the generation of quotes sent bilaterally to clients is not covered by the provisions in Article 17 of MiFID II (and any further requirements thereof).

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