When level 1 of the Market Abuse Directive (MAD)II was discussed two years ago there was talk ofEsma potentially establishing a massive centralised database for cross-marketmonitoring, aka the surveillance beast.

Interestingly, this idea didn’t make it into the final MAR text.Instead it calls on each regulator to have in place the necessary tools foreffective cross-market order book surveillance and to co-operate with eachother.

Also, the European Commission has to submit a report by June2019 on the possibility of establishing a Union framework for cross-marketorder book surveillance. In other words, legislators will not consider thesurveillance beast for the next five years.

In the meantime, Esma focuses on harmonising the recordkeeping standards under Mifir whichwill certainly simplify any exchange of data amongst competent authorities.

 That certainly soundsmuch cheaper than the USCAT system, estimated in the region of $530 million (down from previousestimates of $4bn).

Whether Europe sticks with a decentralised but standardisedregime, or moves towards a more centralised monitoring system, remains to beseen, but given the continuous stream of new consultations published by Esmathis is a discussion that we can thankfully postpone.