How Europe's trading reform is taking shape

Author: | Published: 1 Jun 2005

On May 3 2005 the Committee of European Securities Regulators (Cesr) presented the second part of its final advice on implementing measures of the EC Directive for Markets in Financial Instruments (Mifid). Against the background of the framework of the Directive, the advice defines the detailed requirements investment firms and trading system operators in the EU have to comply with. By specifying the requirements as to best execution, post-trade and, in particular, pre-trade transparency in detail, the advice substantiates the future regulatory framework of securities trading and is important for competition between on-exchange and off-exchange order execution. For many of the mechanisms now introduced by Mifid, there are presently no comparable regulations on the national level in the EU. Considering the far-reaching impact the Directive will have and the fact that the date of its implementation - May 2006 (current status) or 2007 (in discussion) - is getting closer, markets and market participants have to take considerable measures to prepare for the upcoming changes....