Proof of burden

Author: | Published: 1 Sep 2007

Regulatory changes introduced by Markets in Financial Instruments Directive 2004/39/EC (Mifid) have been promoted on the basis that they will lead to a step change, at least in the EEA, in the competitive position of alternative electronic trading platforms by reducing regulatory restrictions on market access. But will Mifid result in the reduction of the regulatory burden on electronic trading platforms or a reduction in regulatory barriers to their efficient cross-border operation?

Electronic trading platforms enable efficient and reliable cross-border communication of price information and transaction execution globally. Their development has encouraged the professionals' market for global trading of financial instruments such as interest rate products, commodity derivatives and currency. Equity trading is more parochial, but while shares in small- to mid-cap companies naturally trade domestically, shares in large-cap companies also trade extensively cross-border and globally (particularly when they are dual listed or have sponsored ADR programmes). Progress...