What changed, Commission Delegated Regulation (EU) 2017/567 of 18 May 2016 supplementing Regulation (EU) No 600/2014

+ ## CHAPTER I — DETERMINING LIQUID MARKETS FOR EQUITY INSTRUMENTS
− ### art_1
+ ### Article 1
− Article 1
+ **1.** For the purposes of Article 2(1), point (17)(b), of Regulation (EU) No 600/2014, a share that is traded daily shall be considered to have a liquid market where all of the following conditions are met:(a) the market capitalisation of the share is not less than EUR 100 million;(b) the average d…
− 1. For the purposes of Article 2(1)(17)(b) of Regulation (EU) No 600/2014, a share that is traded daily shall be considered to have a liquid market where all of the following conditions are satisfied:
+ **2.** For the purposes of paragraph 1, point (a), the market capitalisation of a share shall be calculated by multiplying the number of outstanding shares by the price per share.
− | (a) | the free float of the share is:(i)not less than EUR 100 million for shares admitted to trading on a regulated market;(ii)not less than EUR 200 million for shares that are only traded on MTFs; |
− | --- | --- |
− | (i) | not less than EUR 100 million for shares admitted to trading on a regulated market; |
− | (ii) | not less than EUR 200 million for shares that are only traded on MTFs; |
+ **3.** For the purposes of paragraph 1, point (c), the daily turnover of a share shall be calculated by aggregating the results of multiplying, for each transaction executed during a trading day, the number of shares exchanged between the buyer and the seller by the price per share.
− | (b) | the average daily number of transactions in the share is not less than 250; |
− | --- | --- |
+ **4.** During the six-week period commencing on the first trading day following the first admission of a share to trading on a regulated market or an MTF, that share shall be considered to have a liquid market for the purposes of Article 2(1), point (17)(b), of Regulation (EU) No 600/2014 where the …
− | (c) | the average daily turnover for the share is not less than EUR 1 million. |
− | --- | --- |
+ **5.** Where fewer than five shares traded on the trading venues of a Member State and first admitted to trading in that Member State are considered to have a liquid market as referred to in paragraph 1, the competent authority of that Member State may designate one or more shares first admitted to …
− 2. For the purposes of paragraph 1(a), the free float of a share shall be calculated by multiplying the number of outstanding shares by the price per share, excluding individual holdings in that share that exceed 5 % of the total voting rights of the issuer, unless those holdings are held by a colle…
+ ### Article 2
− 3. For the purposes of paragraph 1(a)(ii), where no actual information is available in accordance with paragraph 2, the free float of a share that is only traded on MTFs shall be calculated by multiplying the number of outstanding shares by the price per share.
+ **1.** For the purposes of Article 2(1), point (17)(b), of Regulation (EU) No 600/2014, a depositary receipt that is traded daily shall be considered to have a liquid market where all of the following conditions are met:(a) the market capitalisation is not less than EUR 100 million;(b) the average d…
− 4. For the purposes of paragraph 1(c), the daily turnover of a share shall be calculated by aggregating the results of multiplying, for each transaction executed during a trading day, the number of shares exchanged between the buyer and the seller by the price per share.
+ **2.** For the purposes of paragraph 1, point (a), the market capitalisation of a depositary receipt shall be calculated by multiplying the number of outstanding units of the depositary receipt by the price per unit.
− 5. During the six-week period commencing on the first trading day following the first admission of a share to trading on a regulated market or an MTF, that share shall be considered to have a liquid market for the purposes of Article 2(1)(17)(b) of Regulation (EU) No 600/2014 where the sum obtained …
+ **3.** For the purposes of paragraph 1, point (c), the daily turnover of a depositary receipt shall be calculated by aggregating the results of multiplying, for each transaction executed during a trading day, the number of units of the depositary receipt exchanged between the buyer and the seller by…
− 6. Where fewer than five shares traded on the trading venues of a Member State and first admitted to trading in that Member State are considered to have a liquid market in accordance with paragraph 1, the competent authority of that Member State may designate one or more share first admitted to trad…
+ **4.** For the six-week period commencing on the first day of trading following the first admission of a depositary receipt to trading on a trading venue, that depositary receipt shall be considered to have a liquid market for the purposes of Article 2(1), point (17)(b), of Regulation (EU) No 600/20…
− ### art_2
+ **5.** Where fewer than five depositary receipts traded on the trading venues of a Member State and first admitted to trading in that Member State are considered to have a liquid market as referred to in paragraph 1, the competent authority of that Member State may designate one or more depositary r…
− Article 2
+ ### Article 3
− 1. For the purposes of Article 2(1)(17)(b) of Regulation (EU) No 600/2014, a depositary receipt that is traded daily shall be considered to have a liquid market where all of the following conditions are satisfied:
+ **1.** For the purposes of Article 2(1), point (17)(b), of Regulation (EU) No 600/2014, an exchange traded fund that is traded daily shall be considered to have a liquid market where all of the following conditions are met:(a) the market capitalisation is not less than 100 units;(b) the average dail…
− | (a) | the free float is not less than EUR 100 million; |
− | --- | --- |
+ **2.** For the purposes of paragraph 1, point (a), the market capitalisation of an exchange traded fund shall be the number of units issued for trading.
− | (b) | the average daily number of transactions in the depositary receipt is not less than 250; |
− | --- | --- |
+ **3.** For the purposes of paragraph 1, point (c), the daily turnover for the exchange traded fund shall be calculated by aggregating the results of multiplying, for each transaction executed during a trading day, the number of units of the exchange traded fund exchanged between the buyer and the se…
− | (c) | the average daily turnover for the depositary receipt is not less than EUR 1 million. |
− | --- | --- |
+ **4.** During the six-week period commencing on the first trading day following the first admission of an exchange traded fund to trading on a trading venue, that exchange traded fund shall be considered to have a liquid market for the purposes of Article 2(1), point (17)(b), of Regulation (EU) No 6…
− 2. For the purposes of paragraph 1(a), the free float of a depositary receipt shall be calculated by multiplying the number of outstanding units of the depositary receipt by the price per unit.
+ **5.** Where fewer than five exchange traded funds traded on the trading venues of a Member State and first admitted to trading in that Member State are considered to have a liquid market as referred to in paragraph 1, the competent authority of that Member State may designate one or more exchange t…
− 3. For the purposes of paragraph 1(c), the daily turnover of a depositary receipt shall be calculated by aggregating the results of multiplying, for each transaction executed during a trading day, the number of units of the depositary receipt exchanged between the buyer and the seller by the price p…
+ ### Article 4
− 4. For the six-week period commencing on the first day of trading following the first admission of a depositary receipt to trading on a trading venue, that depositary receipt shall be considered to have a liquid market for the purposes of Article 2(1)(17)(b) of Regulation (EU) No 600/2014 where the …
+ **1.** For the purposes of Article 2(1), point (17)(b), of Regulation (EU) No 600/2014, a certificate that is traded daily shall be considered to have a liquid market where all of the following conditions are met:(a) the market capitalisation is not less than EUR 1 million;(b) the average daily numb…
− 5. Where fewer than five depositary receipts traded on the trading venues of a Member State and first admitted to trading in that Member State are considered to have a liquid market in accordance with paragraph 1, the competent authority of that Member State may designate one or more depositary rece…
+ **2.** For the purposes of paragraph 1, point (a), the market capitalisation of a certificate shall be the issuance size irrespective of the number of units issued.
− ### art_3
+ **3.** For the purposes of paragraph 1, point (c), the daily turnover for the certificate shall be calculated by aggregating the results of multiplying, for each transaction executed during a trading day, the number of units of the certificate exchanged between the buyer and the seller by the price …
− Article 3
+ **4.** During the six-week period commencing on the first trading day following the first admission of a certificate to trading on a trading venue, that certificate shall be considered to have a liquid market for the purposes of Article 2(1), point (17)(b), of Regulation (EU) No 600/2014 where the e…
− 1. For the purposes of Article 2(1)(17)(b) of Regulation (EU) No 600/2014, an exchange traded fund that is traded daily shall be considered to have a liquid market where all of the following conditions are satisfied:
+ **5.** Where fewer than five certificates traded on the trading venues of a Member State and first admitted to trading in that Member State are considered to have a liquid market as referred to in paragraph 1, the competent authority of that Member State may designate one or more certificates first …
− | (a) | the free float is not less than 100 units; |
− | --- | --- |
+ ### Article 4a
− | (b) | the average daily number of transactions in the exchange traded fund is not less than 10; |
− | --- | --- |
+ For the purposes of Article 2(1), point (17)(b), of Regulation (EU) No 600/2014, other similar financial instruments shall be considered not to have a liquid market over their entire trading life.
− | (c) | the average daily turnover for the exchange traded fund is not less than EUR 500 000. |
− | --- | --- |
+ ### Article 5
− 2. For the purposes of paragraph 1(a), the free float of an exchange traded fund shall be the number of units issued for trading.
+ **1.** The competent authority of the most relevant market in terms of liquidity as specified in Article 16 of Commission Delegated Regulation (EU) 2017/590 (1) shall assess whether a share, depositary receipt, exchange traded fund or a certificate has a liquid market for the purposes of Article 2(1…
− 3. For the purposes of paragraph 1(c), the daily turnover for the exchange traded fund shall be calculated by aggregating the results of multiplying, for each transaction executed during a trading day, the number of units of the exchange traded fund exchanged between the buyer and the seller by the …
+ For the purposes of point (b), the assessment shall be based on the market capitalisation at the last trading day of the first four weeks of trading, the average daily number of transactions and the average daily turnover taking into consideration all transactions executed in the Union for that fina…
− 4. During the six-week period commencing on the first trading day following the first admission of an exchange traded fund to trading on a trading venue, that exchange traded fund shall be considered to have a liquid market for the purposes of Article 2(1)(17)(b) of Regulation (EU) No 600/2014 where…
+ For the purposes of point (c), the assessment shall be based on the market capitalisation at the last trading day of the relevant calendar year, the average daily number of transactions and the average daily turnover taking into Consideration all transactions executed in the Union for that financial…
− 5. Where fewer than five exchange traded funds traded on the trading venues of a Member State and first admitted to trading in that Member State are considered to have a liquid market in accordance with paragraph 1, the competent authority of that Member State may designate one or more exchange trad…
+ Competent authorities shall publish the result of their assessment immediately upon completion of the assessment.
− ### art_4
+ **2.** Competent authorities, market operators and investment firms, including investment firms operating a trading venue, shall use the information published in accordance with paragraph 1:(a) for a period of six weeks commencing on the first day of trading of the financial instrument, where the as…
− Article 4
+ Where the information referred to in this paragraph is replaced by new information pursuant to paragraph 1, point (d), competent authorities, market operators and investment firms, including investment firms operating a trading venue, shall use that new information for the purposes of Article 2(1), …
− 1. For the purposes of Article 2(1)(17)(b) of Regulation (EU) No 600/2014, a certificate that is traded daily shall be considered to have a liquid market where all of the following conditions are satisfied:
+ **3.** For the purposes of paragraph 1, trading venues shall submit to competent authorities the information set out in the Annex within the following timeframes:(a) for financial instruments which are admitted to trading for the first time, before the day on which the financial instrument is first …
− | (a) | the free float is not less than EUR 1 million; |
− | --- | --- |
+ ## CHAPTER II — DATA PROVISION OBLIGATIONS FOR TRADING VENUES AND SYSTEMATIC INTERNALISERS
− | (b) | the average daily number of transactions in the certificate is not less than 20; |
− | --- | --- |
+ ### Article 6
− | (c) | the average daily turnover for the certificate is not less than EUR 500 000. |
− | --- | --- |
+ **1.** For the purposes of making market data containing the information set out in Articles 3, 4, 6 to 11, 15 and 18 of Regulation (EU) No 600/2014 available to the public on a reasonable commercial basis, market operators and investment firms operating a trading venue and systematic internalisers …
− 2. For the purposes of paragraph 1(a), the free float of a certificate shall be the issuance size irrespective of the number of units issued.
+ **2.** Articles 7, 8(2), 9, 10(2) and 11 shall not apply to market operators or investment firms operating trading venues or to systematic internalisers that make market data available to the public free of charge.
− 3. For the purposes of paragraph 1(c), the daily turnover for the certificate shall be calculated by aggregating the results of multiplying, for each transaction executed during a trading day, the number of units of the certificate exchanged between the buyer and the seller by the price per unit.
+ ### Article 7
− 4. During the six-week period commencing on the first trading day following the first admission of a certificate to trading on a trading venue, that certificate shall be considered to have a liquid market for the purposes of Article 2(1)(17)(b) of Regulation (EU) No 600/2014 where the estimated free…
+ **1.** The price of market data shall be based on the cost of producing and disseminating such data and may include a reasonable margin.
− 5. Where fewer than five certificates traded on the trading venues of a Member State and first admitted to trading in that Member State are considered to have a liquid market in accordance with paragraph 1, the competent authority of that Member State may designate one or more certificate first admi…
+ **2.** The cost of producing and disseminating market data may include an appropriate share of joint costs for other services provided by market operators or investment firms operating a trading venue or by systematic internalisers.
− ### art_5
+ ### Article 8
− Article 5
+ **1.** Market operators and investment firms operating a trading venue and systematic internalisers shall make market data available at the same price and on the same terms and conditions to all customers falling within the same category in accordance with published objective criteria.
− 1. The competent authority of the most relevant market in terms of liquidity as specified in Article 16 of Commission Delegated Regulation (EU) 2017/590 (4) shall assess whether a share, depositary receipt, exchange traded fund or a certificate has a liquid market for the purposes of Article 2(1)(17…
+ **2.** Any differentials in prices charged to different categories of customers shall be proportionate to the value which the market data represents to those customers, taking into account:(a) the scope and scale of the market data including the number of financial instruments covered and their trad…
− | (a) | before the financial instrument is first traded on the trading venue, as specified in Articles 1(5), 2(4), 3(4) and 4(4); |
− | --- | --- |
+ **3.** For the purposes of paragraph 1, market operators and investment firms operating a trading venue and systematic internalisers shall have scalable capacities in place to ensure that customers obtain timely access to market data at all times on a non-discriminatory basis.
− | (b) | between the end of the first four weeks of trading and the end of the first six weeks of trading of the financial instrument. The assessment for this scenario shall be based on the free float as at the last trading day of the first four weeks of trading, the average daily number of transacti…
− | --- | --- |
+ ### Article 9
− | (c) | between the end of every calendar year and before 1 March of the following year for financial instruments traded on a trading venue before 1 December of the relevant calendar year. The assessment for this scenario shall be based on the free float as at the last trading day of the relevant ca…
− | --- | --- |
+ **1.** Market operators and investment firms operating a trading venue and systematic internalisers shall charge for the use of market data according to the use made by the individual end-users of the market data (‘per user basis’). Market operators and investment firms operating a trading venue and…
− | (d) | immediately after the moment where, following a corporate action, any previous assessment has changed. |
− | --- | --- |
+ **2.** By way of derogation from paragraph 1, market operators and investment firms operating a trading venue and systematic internalisers may decide not to make market data available on a per user basis where to charge on a per user basis is disproportionate to the cost of making that data availabl…
− Competent authorities shall ensure that the result of their assessment is published immediately upon completion of the assessment.
+ **3.** Market operators and investment firms operating a trading venue and systematic internalisers shall provide grounds for the refusal to make market data available on a per user basis and shall publish those grounds on their webpage.
− 2. Competent authorities, market operators and investment firms including investment firms operating a trading venue shall use the information published in accordance with paragraph 1:
+ ### Article 10
− | (a) | for a period of six weeks commencing on the first day of trading of the financial instrument where the assessment is carried out pursuant to paragraph 1(a) of this Article; |
− | --- | --- |
+ **1.** Market operators and investment firms operating a trading venue and systematic internalisers shall make market data available without being bundled with other services.
− | (b) | for a period commencing six weeks after the first day of trading of that financial instrument and ending on 31 March of the year of publication of the information in accordance with paragraph 1(c) of this Article where the assessment is carried out pursuant to paragraph 1(b) of this Article;…
− | --- | --- |
+ **2.** Prices for market data shall be charged on the basis of the level of market data disaggregation provided for in Article 12(1) of Regulation (EU) No 600/2014.
− | (c) | for a period of one year commencing on 1 April following the date of publication where the assessment is carried out pursuant to paragraph 1(c) of this Article. |
− | --- | --- |
+ ### Article 11
− Where the information referred to in this paragraph is replaced by new information pursuant to paragraph 1(d) of this Article, competent authorities, market operators and investment firms including investment firms operating a trading venue shall use that new information for the purposes Article 2(1…
+ **1.** Market operators and investment firms operating a trading venue and systematic internalisers shall disclose the price and other terms and conditions for the provision of the market data in a manner which is easily accessible to the public.
− 3. For the purposes of paragraph 1, trading venues shall submit to competent authorities the information set out in the Annex within the following timeframes:
+ **2.** The disclosure shall include the following:(a) current price lists, including:— fees per display user;— non-display fees;— discount policies;— fees associated with licence conditions;— fees for pre-trade and for post-trade market data;— fees for other subsets of information, including those r…
− | (a) | for financial instruments which are admitted to trading for the first time, before the day on which the financial instrument is first traded; |
− | --- | --- |
+ ## CHAPTER III — DATA PUBLICATION OBLIGATIONS FOR SYSTEMATIC INTERNALISERS
− | (b) | for financial instruments already admitted to trading, in all the following timeframes:(i)no later than three days after the end of the first four weeks of trading;(ii)after the end of every calendar year but no later than 3 January of the following year;(iii)immediately after the moment whe…
− | --- | --- |
− | (i) | no later than three days after the end of the first four weeks of trading; |
− | (ii) | after the end of every calendar year but no later than 3 January of the following year; |
− | (iii) | immediately after the moment where, following a corporate action, the information previously submitted to the competent authority has changed. |
+ ### Article 12
− ### art_6
− 
− Article 6
− 
− 1. For the purposes of making market data containing the information set out in Articles 3, 4, 6 to 11, 15 and 18 of Regulation (EU) No 600/2014 available to the public on a reasonable commercial basis, market operators and investment firms operating a trading venue and systematic internalisers shal…
− 
− 2. Articles 7, 8(2), 9, 10(2) and 11 shall not apply to market operators or investment firms operating trading venues or to systematic internalisers that make market data available to the public free of charge.
− 
− ### art_7
− 
− Article 7
− 
− 1. The price of market data shall be based on the cost of producing and disseminating such data and may include a reasonable margin.
− 
− 2. The cost of producing and disseminating market data may include an appropriate share of joint costs for other services provided by market operators or investment firms operating a trading venue or by systematic internalisers.
− 
− ### art_8
− 
− Article 8
− 
− 1. Market operators and investment firms operating a trading venue and systematic internalisers shall make market data available at the same price and on the same terms and conditions to all customers falling within the same category in accordance with published objective criteria.
− 
− 2. Any differentials in prices charged to different categories of customers shall be proportionate to the value which the market data represents to those customers, taking into account:
− 
− | (a) | the scope and scale of the market data including the number of financial instruments covered and their trading volume; |
− | --- | --- |
− 
− | (b) | the use made by the customer of the market data, including whether it is used for the customer's own trading activities, for resale or for data aggregation. |
− | --- | --- |
− 
− 3. For the purposes of paragraph 1, market operators and investment firms operating a trading venue and systematic internalisers shall have scalable capacities in place to ensure that customers obtain timely access to market data at all times on a non-discriminatory basis.
− 
− ### art_9
− 
− Article 9
− 
− 1. Market operators and investment firms operating a trading venue and systematic internalisers shall charge for the use of market data according to the use made by the individual end-users of the market data (‘per user basis’). Market operators and investment firms operating a trading venue and sys…
− 
− 2. By way of derogation from paragraph 1, market operators and investment firms operating a trading venue and systematic internalisers may decide not to make market data available on a per user basis where to charge on a per user basis is disproportionate to the cost of making that data available, h…
− 
− 3. Market operators and investment firms operating a trading venue and systematic internalisers shall provide grounds for the refusal to make market data available on a per user basis and shall publish those grounds on their webpage.
− 
− ### art_10
− 
− Article 10
− 
− 1. Market operators and investment firms operating a trading venue and systematic internalisers shall make market data available without being bundled with other services.
− 
− 2. Prices for market data shall be charged on the basis of the level of market data disaggregation provided for in Article 12(1) of Regulation (EU) No 600/2014.
− 
− ### art_11
− 
− Article 11
− 
− 1. Market operators and investment firms operating a trading venue and systematic internalisers shall disclose the price and other terms and conditions for the provision of the market data in a manner which is easily accessible to the public.
− 
− 2. The disclosure shall include the following:
− 
− | (a) | current price lists, including:—fees per display user;—non-display fees;—discount policies;—fees associated with licence conditions;—fees for pre-trade and for post-trade market data;—fees for other subsets of information, including those required in accordance with Commission Delegated Regu…
− | --- | --- |
− | — | fees per display user; |
− | — | non-display fees; |
− | — | discount policies; |
− | — | fees associated with licence conditions; |
− | — | fees for pre-trade and for post-trade market data; |
− | — | fees for other subsets of information, including those required in accordance with Commission Delegated Regulation (EU) 2017/572 (5); |
− | — | other contractual terms and conditions regarding the current price list; |
− 
− | (b) | advance disclosure with a minimum of 90 days' notice of future price changes; |
− | --- | --- |
− 
− | (c) | information on the content of the market data including:(i)the number of instruments covered;(ii)the total turnover of instruments covered;(iii)pre-trade and post-trade market data ratio;(iv)information on any data provided in addition to market data;(v)the date of the last licence fee adapt…
− | --- | --- |
− | (i) | the number of instruments covered; |
− | (ii) | the total turnover of instruments covered; |
− | (iii) | pre-trade and post-trade market data ratio; |
− | (iv) | information on any data provided in addition to market data; |
− | (v) | the date of the last licence fee adaption for market data provided; |
− 
− | (d) | revenue obtained from making market data available and the proportion of that revenue compared to the total revenue of the market operator and investment firm operating a trading venue or systematic internalisers; |
− | --- | --- |
− 
− | (e) | information on how the price was set, including the cost accounting methodologies used and the specific principles according to which direct and variable joint costs are allocated and fixed joint costs are apportioned, between the production and dissemination of market data and other service…
− | --- | --- |
− 
− ### art_12
− 
− Article 12
+ ### Article 13
− ### art_13
+ **1.** Systematic internalisers shall specify and update on their website's homepage which of the publication arrangements set out in Article 17(3)(a) of Regulation (EU) No 600/2014 they use to make public their quotes.
− Article 13
+ **2.** Where systematic internalisers make their quotes public through the arrangements of a trading venue or an APA, the systematic internaliser shall disclose their identity in the quote.
− 1. Systematic internalisers shall specify and update on their website's homepage which of the publication arrangements set out in Article 17(3)(a) of Regulation (EU) No 600/2014 they use to make public their quotes.
+ **3.** Where systematic internalisers employ more than one arrangement to make public their quotes, publication of the quotes shall occur simultaneously.
− 2. Where systematic internalisers make their quotes public through the arrangements of a trading venue or an APA, the systematic internaliser shall disclose their identity in the quote.
+ **4.** Systematic internalisers shall make public their quotes in a machine-readable format. Quotes shall be considered to be published in a machine-readable format where the publication meets the criteria set out in Commission Delegated Regulation (EU) 2017/571 (3).
− 3. Where systematic internalisers employ more than one arrangement to make public their quotes, publication of the quotes shall occur simultaneously.
+ **5.** Where systematic internalisers make public their quotes through proprietary arrangements only, the quotes shall also be made public in a human-readable format. Quotes shall be considered to be published in a human-readable format where:(a) the content of the quote is in a format which can be …
− 4. Systematic internalisers shall make public their quotes in a machine-readable format. Quotes shall be considered to be published in a machine-readable format where the publication meets the criteria set out in Commission Delegated Regulation (EU) 2017/571 (6).
+ **6.** Quotes shall be published using the standards and specifications set out in Commission Delegated Regulation (EU) 2017/587 (4).
− 5. Where systematic internalisers make public their quotes through proprietary arrangements only, the quotes shall also be made public in a human-readable format. Quotes shall be considered to be published in a human-readable format where:
+ ### Article 14
− | (a) | the content of the quote is in a format which can be understood by the average reader; |
− | --- | --- |
+ **1.** For the purposes of Article 15(1) of Regulation (EU) No 600/2014, exceptional market conditions are considered to exist where to impose on a systematic internaliser an obligation to provide firm quotes to clients would be contrary to prudent risk management and, in particular, where:(a) the t…
− | (b) | the quote is published on the systematic internaliser's website and the website's homepage contains clear instructions for accessing the quote. |
− | --- | --- |
+ **2.** For the purposes of Article 15(1) of Regulation (EU) No 600/2014, a systematic internaliser may update its quotes at any time, provided at all times that the updated quotes are the consequence of, and consistent with, genuine intentions of the systematic internaliser to trade with its clients…
− 6. Quotes shall be published using the standards and specifications set out in Commission Delegated Regulation (EU) 2017/587 (7).
+ **3.** For the purposes of Article 15(2) of Regulation (EU) No 600/2014, a price falls within a public range close to market conditions where the following conditions are fulfilled:(a) the price is within the bid and offer quotes of the systematic internaliser;(b) the quotes referred to in point (a)…
− ### art_14
+ **4.** For the purposes of Article 15(3) of Regulation (EU) No 600/2014, execution in several securities shall be considered part of one transaction where the criteria laid down in Delegated Regulation (EU) 2017/587 are fulfilled.
− Article 14
+ **5.** For the purposes of Article 15(3) of Regulation (EU) No 600/2014, an order shall be considered subject to conditions other than the current market price where the criteria laid down in Delegated Regulation (EU) 2017/587 are fulfilled.
− 1. For the purposes of Article 15(1) of Regulation (EU) No 600/2014, exceptional market conditions are considered to exist where to impose on a systematic internaliser an obligation to provide firm quotes to clients would be contrary to prudent risk management and, in particular, where:
+ ### Article 15
− | (a) | the trading venue where the financial instrument was first admitted to trading or the most relevant market in terms of liquidity halts trading for that financial instrument in accordance with Article 48(5) of Directive 2014/65/EU; |
− | --- | --- |
+ **1.** For the purposes of Article 17(2) of Regulation (EU) No 600/2014, the number or volume of orders shall be considered to considerably exceed the norm where a systematic internaliser cannot execute the number or volume of those orders without exposing itself to undue risk.
− | (b) | the trading venue where the financial instrument was first admitted to trading or the most relevant market in terms of liquidity allows market making obligations to be suspended; |
− | --- | --- |
+ **2.** Investment firms acting as systematic internalisers shall determine in advance and in a manner that is objective and consistent with their risk management policy and procedures referred to in Article 23 of Commission Delegated Regulation (EU) 2017/565 (6), when the number or volume of orders …
− | (c) | in the case of an exchange traded fund, a reliable market price is not available for a significant number of instruments underlying the ETF or the index; |
− | --- | --- |
+ **3.** For the purposes of paragraph 2, a systematic internaliser shall establish, maintain and implement as part of its risk management policy and procedures, a policy for identifying the number or volume of orders that it can execute without being exposed to undue risk, taking into account both th…
− | (d) | a competent authority prohibits short sales in that financial instrument according to Article 20 of Regulation (EU) No 236/2012 of the European Parliament and of the Council (8). |
− | --- | --- |
+ **4.** In accordance with Article 17(2) of Regulation (EU) No 600/2014, the policy referred to in paragraph 3 shall be non-discriminatory to clients.
− 2. For the purposes of Article 15(1) of Regulation (EU) No 600/2014, a systematic internaliser may update its quotes at any time, provided at all times that the updated quotes are the consequence of, and consistent with, genuine intentions of the systematic internaliser to trade with its clients in …
+ ### Article 16a
− 3. For the purposes of Article 15(2) of Regulation (EU) No 600/2014, a price falls within a public range close to market conditions where the following conditions are fulfilled:
+ **1.** For the purposes of Article 31(1) of Regulation (EU) No 600/2014, post-trade risk reduction services are services that meet all the following conditions:(a) they are provided by a third-party service provider on the basis of non-discretionary rules that are set in advance;(b) the post-trade r…
− | (a) | the price is within the bid and offer quotes of the systematic internaliser; |
− | --- | --- |
+ **2.** For the purposes of Article 31(1) of Regulation (EU) No 600/2014, post-trade risk reduction services shall include compression services, rebalancing services, and basis risk optimisation services.
− | (b) | the quotes referred to in point (a) reflect prevailing market conditions for the relevant financial instrument in accordance with Article 14(7) of Regulation (EU) No 600/2014. |
− | --- | --- |
+ ## CHAPTER IV — DERIVATIVES
− 4. For the purposes of Article 15(3) of Regulation (EU) No 600/2014, execution in several securities shall be considered part of one transaction where the criteria laid down in Delegated Regulation (EU) 2017/587 are fulfilled.
+ ### Article 17
− 5. For the purposes of Article 15(3) of Regulation (EU) No 600/2014, an order shall be considered subject to conditions other than the current market price where the criteria laid down in Delegated Regulation (EU) 2017/587 are fulfilled.
+ **1.** For the purposes of Article 31(1) of Regulation (EU) No 600/2014, investment firms and market operators providing portfolio compression shall fulfil the conditions in paragraphs 2 to 6.
− ### art_15
+ **2.** Investment firms and market operators shall conclude an agreement with the participants to the portfolio compression providing for the compression process and its legal effects, including identifying the point in time at which each portfolio compression becomes legally binding.
− Article 15
+ **3.** The agreement referred to in paragraph 2 shall include all relevant legal documentation describing how derivatives submitted for inclusion in the portfolio compression are terminated and how they are replaced by other derivatives.
− 1. For the purposes of Article 17(2) of Regulation (EU) No 600/2014, the number or volume of orders shall be considered to considerably exceed the norm where a systematic internaliser cannot execute the number or volume of those orders without exposing itself to undue risk.
+ **4.** Before each compression process is initiated, investment firms and market operators providing portfolio compression shall:(a) require each participant to the portfolio compression to specify the participant's risk tolerance including specifying a limit for counterparty risk, a limit for marke…
− 2. Investment firms acting as systematic internalisers shall determine in advance and in a manner that is objective and consistent with their risk management policy and procedures referred to in Article 23 of Commission Delegated Regulation (EU) 2017/565 (9), when the number or volume of orders soug…
+ **5.** In order to adjust the compression to the risk tolerance set by the participants to the portfolio compression and in order to maximise the efficiency of the portfolio compression, investment firms and market operators may grant participants additional time to add derivatives eligible for term…
− 3. For the purposes of paragraph 2, a systematic internaliser shall establish, maintain and implement as part of its risk management policy and procedures, a policy for identifying the number or volume of orders that it can execute without being exposed to undue risk, taking into account both the ca…
+ **6.** Investment firms and market operators shall only perform the portfolio compression once all participants to the portfolio compression have agreed to the portfolio compression proposal.
− 4. In accordance with Article 17(2) of Regulation (EU) No 600/2014, the policy referred to in paragraph 3 shall be non-discriminatory to clients.
− 
− ### art_16
+ ## CHAPTER V — SUPERVISORY MEASURES ON PRODUCT INTERVENTION AND POSITION MANAGEMENT / SECTION 1 — Product intervention
− Article 16
+ ### Article 19
− For the purposes of Article 18(6) of Regulation (EU) No 600/2014, the size specific to the instrument in respect of instruments traded on request for quote, voice, hybrid or other trading forms shall be as set out in Annex III to Commission Delegated Regulation (EU) 2017/583 (10).
+ **1.** For the purposes of Article 40(2)(a) of Regulation (EU) No 600/2014, ESMA shall assess the relevance of all factors and criteria listed in paragraph 2, and take into consideration all relevant factors and criteria in determining when the marketing, distribution or sale of certain financial in…
− ### art_17
− Article 17
− 
− 1. For the purposes of Article 31(1) of Regulation (EU) No 600/2014, investment firms and market operators providing portfolio compression shall fulfil the conditions in paragraphs 2 to 6.
− 
− 2. Investment firms and market operators shall conclude an agreement with the participants to the portfolio compression providing for the compression process and its legal effects, including identifying the point in time at which each portfolio compression becomes legally binding.
− 
− 3. The agreement referred to in paragraph 2 shall include all relevant legal documentation describing how derivatives submitted for inclusion in the portfolio compression are terminated and how they are replaced by other derivatives.
− 
− 4. Before each compression process is initiated, investment firms and market operators providing portfolio compression shall:
− 
− | (a) | require each participant to the portfolio compression to specify the participant's risk tolerance including specifying a limit for counterparty risk, a limit for market risk and a cash payment tolerance. Investment firms and market operators shall respect the risk tolerance specified by the …
− | --- | --- |
− 
− | (b) | link the derivatives submitted for portfolio compression and submit to each participant a portfolio compression proposal that includes the following information:(i)the identification of the counterparties affected by the compression,(ii)the related change to the combined notional value of th…
− | --- | --- |
− | (i) | the identification of the counterparties affected by the compression, |
− | (ii) | the related change to the combined notional value of the derivatives, |
− | (iii) | the variation of the combined notional amount compared to the risk tolerance specified. |
− 
− 5. In order to adjust the compression to the risk tolerance set by the participants to the portfolio compression and in order to maximise the efficiency of the portfolio compression, investment firms and market operators may grant participants additional time to add derivatives eligible for terminat…
− 
− 6. Investment firms and market operators shall only perform the portfolio compression once all participants to the portfolio compression have agreed to the portfolio compression proposal.
− 
− ### art_18
− 
− Article 18
− 
− 1. For the purposes of Article 31(2) of Regulation (EU) No 600/2014 investment firms and market operators shall make the following information public through an APA for each portfolio compression cycle:
− 
− | (a) | a list of derivatives submitted for inclusion in the portfolio compression, |
− | --- | --- |
− 
− | (b) | a list of derivatives replacing the terminated derivatives, |
− | --- | --- |
− 
− | (c) | a list of derivatives changed or terminated as a result of the portfolio compression, |
− | --- | --- |
− 
− | (d) | the number of derivatives and their value expressed in terms of notional amount. |
− | --- | --- |
− 
− The information referred to in the first subparagraph shall be disaggregated per type of derivative and per currency.
− 
− 2. Investment firms and market operators shall make public the information referred to in paragraph 1 as close to real-time as is technically possible and no later than the close of the following business day after a compression proposal becomes legally binding in accordance with the agreement refer…
− 
− ### art_19
− 
− Article 19
− 
− 1. For the purposes of Article 40(2)(a) of Regulation (EU) No 600/2014, ESMA shall assess the relevance of all factors and criteria listed in paragraph 2, and take into consideration all relevant factors and criteria in determining when the marketing, distribution or sale of certain financial instru…
− 
+ **2.** The factors and criteria to be assessed by ESMA to determine whether there is a significant investor protection concern or a threat to the orderly functioning and integrity of financial markets or commodity markets or to the stability of the whole or part of the financial system of the Union …
− 2. The factors and criteria to be assessed by ESMA to determine whether there is a significant investor protection concern or a threat to the orderly functioning and integrity of financial markets or commodity markets or to the stability of the whole or part of the financial system of the Union shal…
+ ### Article 20
− | (a) | the degree of complexity of the financial instrument or type of financial activity or practice in relation to the type of clients, as assessed in accordance with point (c), involved in the financial activity or financial practice, or to whom the financial instrument is marketed or sold, taki…
− | --- | --- |
− | — | the type of the underlying or reference assets and the degree of transparency of the underlying or reference assets; |
− | — | the degree of transparency of costs and charges associated with the financial instrument, financial activity or financial practice and, in particular, the lack of transparency resulting from multiple layers of costs and charges; |
− | — | the complexity of the performance calculation, taking into account in particular whether the return is dependent on the performance of one or more underlying or reference assets which are in turn affected by other factors or whether the return depends not only on the values of the underlying o…
− | — | the nature and scale of any risks; |
− | — | whether the instrument or service is bundled with other products or services; or |
− | — | the complexity of any terms and conditions; |
+ **1.** For the purposes of Article 41(2)(a) of Regulation (EU) No 600/2014, EBA shall assess the relevance of all factors and criteria listed in paragraph 2, and take into consideration all relevant factors and criteria in determining when the marketing, distribution or sale of certain structured de…
− | (b) | the size of potential detrimental consequences, considering in particular:—the notional value of the financial instrument;—the number of clients, investors or market participants involved;—the relative share of the product in investors' portfolios;—the probability, scale and nature of any de…
− | --- | --- |
− | — | the notional value of the financial instrument; |
− | — | the number of clients, investors or market participants involved; |
− | — | the relative share of the product in investors' portfolios; |
− | — | the probability, scale and nature of any detriment, including the amount of loss potentially suffered; |
− | — | the anticipated duration of the detrimental consequences; |
− | — | the volume of the issuance; |
− | — | the number of intermediaries involved; |
− | — | the growth of the market or sales; or |
− | — | the average amount invested by each client in the financial instrument; |
− 
− | (c) | the type of clients involved in a financial activity or financial practice or to whom a financial instrument is marketed or sold, taking into account, in particular:—whether the client is a retail client, a professional client or an eligible counterparty;—clients' skills and abilities, inclu…
− | --- | --- |
− | — | whether the client is a retail client, a professional client or an eligible counterparty; |
− | — | clients' skills and abilities, including the level of education, experience with similar financial instruments or selling practices; |
− | — | clients' economic situation, including their income and wealth; |
− | — | clients' core financial objectives, including pension saving and home ownership financing; or |
− | — | whether the instrument or service is being sold to clients outside the intended target market or whether the target market has not been adequately identified; |
− 
− | (d) | the degree of transparency of the financial instrument or type of financial activity or practice, taking into account, in particular:—the type and transparency of the underlying;—any hidden costs and charges;—the use of techniques drawing clients' attention but not necessarily reflecting the…
− | --- | --- |
− | — | the type and transparency of the underlying; |
− | — | any hidden costs and charges; |
− | — | the use of techniques drawing clients' attention but not necessarily reflecting the suitability or overall quality of the financial instrument, financial activity or financial practice; |
− | — | the nature of risks and transparency of risks; or |
− | — | the use of product names or terminology or other information that imply a greater level of security or return than those which are actually possible or likely, or which imply product features that do not exist; |
− 
− | (e) | the particular features or components of the financial instrument, financial activity or financial practice, including any embedded leverage, taking into account, in particular:—the leverage inherent in the product;—the leverage due to financing;—the features of securities financing transact…
− | --- | --- |
− | — | the leverage inherent in the product; |
− | — | the leverage due to financing; |
− | — | the features of securities financing transactions; or |
− | — | the fact that the value of any underlying is no longer available or reliable; |
− 
− | (f) | the existence and degree of disparity between the expected return or profit for investors and the risk of loss in relation to the financial instrument, financial activity or financial practice, taking into account, in particular:—the structuring costs of such financial instrument, activity o…
− | --- | --- |
− | — | the structuring costs of such financial instrument, activity or practice and other costs; |
− | — | the disparity in relation to the issuer's risk retained by the issuer; or |
− | — | the risk/return profile; |
− 
− | (g) | the ease and cost with which investors are able to sell the relevant financial instrument or switch to another financial instrument, taking into account, in particular:—the bid/ask spread;—the frequency of trading availability;—the issuance size and size of the secondary market;—the presence…
− | --- | --- |
− | — | the bid/ask spread; |
− | — | the frequency of trading availability; |
− | — | the issuance size and size of the secondary market; |
− | — | the presence or absence of liquidity providers or secondary market makers; |
− | — | the features of the trading system; or |
− | — | any other barriers to exit; |
− 
− | (h) | the pricing and associated costs of the financial instrument, financial activity or financial practice, taking into account, in particular:—the use of hidden or secondary charges; or—charges that do not reflect the level of service provided; |
− | --- | --- |
− | — | the use of hidden or secondary charges; or |
− | — | charges that do not reflect the level of service provided; |
− 
− | (i) | the degree of innovation of a financial instrument, a financial activity or a financial practice, taking into account, in particular:—the degree of innovation related to the structure of the financial instrument, financial activity or financial practice, including embedding and triggering;—t…
− | --- | --- |
− | — | the degree of innovation related to the structure of the financial instrument, financial activity or financial practice, including embedding and triggering; |
− | — | the degree of innovation relating to the distribution model or length of the intermediation chain; |
− | — | the extent of innovation diffusion, including whether the financial instrument, financial activity or financial practice is innovative for particular categories of clients; |
− | — | innovation involving leverage; |
− | — | the lack of transparency of the underlying; or |
− | — | the past experience of the market with similar financial instruments or selling practices; |
− | (j) | the selling practices associated with the financial instrument, taking into account, in particular:—the communication and distribution channels used;—the information, marketing or other promotional material associated with the investment;—the assumed investment purposes; or—whether the decis…
− | --- | --- |
− | — | the communication and distribution channels used; |
− | — | the information, marketing or other promotional material associated with the investment; |
− | — | the assumed investment purposes; or |
− | — | whether the decision to buy is secondary or tertiary following an earlier purchase; |
− 
− | (k) | the financial and business situation of the issuer of a financial instrument, taking into account, in particular:—the financial situation of the issuer or any guarantor; or—the transparency of business situation of the issuer or guarantor; |
− | --- | --- |
− | — | the financial situation of the issuer or any guarantor; or |
− | — | the transparency of business situation of the issuer or guarantor; |
− 
− | (l) | whether there is insufficient, or unreliable, information about a financial instrument, provided either by the manufacturer or the distributors, to enable market participants at whom it is targeted to make an informed decision, taking into account the nature and type of the financial instrum…
− | --- | --- |
− 
− | (m) | whether the financial instrument, financial activity or financial practice poses a high risk to the performance of transactions entered into by participants or investors in the relevant market; |
− | --- | --- |
− 
− | (n) | whether the financial activity or financial practice would significantly compromise the integrity of the price formation process in the market concerned, such that the price or value of the financial instrument in question is no longer determined according to legitimate market forces of supp…
− | --- | --- |
− 
− | (o) | whether the characteristics of a financial instrument make it particularly susceptible to being used for the purposes of financial crime and, in particular whether those characteristics could potentially encourage the use of the financial instrument for:—any fraud or dishonesty;—misconduct i…
− | --- | --- |
− | — | any fraud or dishonesty; |
− | — | misconduct in, or misuse of information in relation to a financial market; |
− | — | handling the proceeds of crime; |
− | — | the financing of terrorism; or |
− | — | facilitating money laundering; |
− 
− | (p) | whether the financial activity or financial practice poses a particularly high risk to the resilience or smooth operation of markets and their infrastructure; |
− | --- | --- |
− 
− | (q) | whether a financial instrument, financial activity or financial practice could lead to a significant and artificial disparity between prices of a derivative and those in the underlying market; |
− | --- | --- |
− 
− | (r) | whether the financial instrument, financial activity or financial practice poses a high risk of disruption to financial institutions deemed to be important to the financial system of the Union; |
− | --- | --- |
− 
− | (s) | the relevance of the distribution of the financial instrument as a funding source for the issuer; |
− | --- | --- |
− 
− | (t) | whether a financial instrument, financial activity or financial practice poses particular risks to the market or payment systems infrastructure, including trading, clearing and settlement systems; or |
− | --- | --- |
− 
− | (u) | whether a financial instrument, financial activity or financial practice may threaten investors' confidence in the financial system. |
− | --- | --- |
− 
− ### art_20
− 
− Article 20
− 
− 1. For the purposes of Article 41(2)(a) of Regulation (EU) No 600/2014, EBA shall assess the relevance of all factors and criteria listed in paragraph 2, and take into consideration all relevant factors and criteria in determining when the marketing, distribution or sale of certain structured deposi…
− 
− 
− 2. The factors and criteria to be assessed by EBA to determine whether there is a significant investor protection concern or a threat to the orderly functioning and integrity of financial markets or to the stability of the whole or part of the financial system in the Union shall be the following:
+ **2.** The factors and criteria to be assessed by EBA to determine whether there is a significant investor protection concern or a threat to the orderly functioning and integrity of financial markets or to the stability of the whole or part of the financial system in the Union shall be the following…
− | (a) | the degree of complexity of a structured deposit or type of financial activity or practice in relation to the type of clients, as assessed in accordance with point (c), involved in the financial activity, or financial practice, taking into account, in particular:—the type of the underlying o…
− | --- | --- |
− | — | the type of the underlying or reference assets and the degree of transparency of the underlying or reference assets; |
− | — | the degree of transparency of costs and charges associated with the structured deposit, financial activity or financial practice and, in particular, the lack of transparency resulting from multiple layers of costs and charges; |
− | — | the complexity of the performance calculation, taking into account in particular whether the return is dependent on the performance of one or more underlying or reference assets which are in turn affected by other factors or whether the return depends not only on the values of the underlying o…
− | — | the nature and scale of any risks; |
− | — | whether the structured deposit or service is bundled with other products or services; or |
− | — | the complexity of any terms and conditions; |
+ ### Article 21
− | (b) | the size of potential detrimental consequences, considering, in particular:—the notional value of an issuance of structured deposits;—the number of clients, investors or market participants involved;—the relative share of the product in investors' portfolios;—the probability, scale and natur…
− | --- | --- |
− | — | the notional value of an issuance of structured deposits; |
− | — | the number of clients, investors or market participants involved; |
− | — | the relative share of the product in investors' portfolios; |
− | — | the probability, scale and nature of any detriment, including the amount of loss potentially suffered; |
… diff truncated at 500 changed lines …