Spain's BME to expand Mifid II regulatory services

The Spanish exchange has said it will broaden its range of regulatory compliance services to allow clients to comply with upcoming European directive Mifid II ahead of its introduction in January2018.

The Spanish exchange BME said one of the services offered will be an Approved Publication Arrangement(APA), which allows market participants to fulfill their post-trade transparencyobligations before the introduction of the European regulatory directive, BMEannounced on Wednesday.

Through this APA service, BME will publish details of itsclients' over-the-counter transactions through the group’s information disseminationservices.

BME said it will also manage a regulatory compliance service forSystematic Internalisers (SI) – firms which execute client orders outsideregulated markets or multilateral trading facilities. 

Articles 12 to 18 ofMifid oblige these firms to make public firm quotes for bonds, structuredfinance products, emission allowances and derivatives.

According to the document, the calculations to determine SIstatus should exclude the creation and redemption of exchange-traded fundunits, trades executed on own account following a client order and tradesreported to a regulated market..

The deadline for compliance with the SI regime has been deferred until September 1 2018.

In addition, the Spanish exchange said it will act as an AuthorisedReporting Mechanism (ARM), providing a communication service to the appropriateauthorities on the details of their clients’ transactions, in the requiredformats by the regulation. The service is an expansion of BME’s currentTransaction Reporting Service (SIO), in compliance with Mifid I.

These services will be provided by BME Regulatory Services,acting as “a one-stop shop,” according to the BME’s statement on Wednesday.

Tradeweb said on January 10 that it had started testing anew Mifid-compliant reporting service, and Goldman Sachs, JP Morgan andDeutsche have signed up to use the platform.

The firm also announced an APA forfirms to make public their off-venue trades. As well as the reportingobligation, Tradeweb’s APA will include a comprehensive rules engine todetermine who is responsible for reporting and whether the trade qualifies fora deferred publication, the firm said in January.