Commission welcomes political agreement on the review of the Markets in Financial Instruments Regulation

The Commission welcomes the political agreement reached yesterday between the European Parliament and the Council on the Commission’s proposal of 2021 for a review of the Regulation governing rules about the structure of the markets in financial instruments (‘MiFIR Review’).

The review creates a mandatory framework for the so-called ‘consolidated tape provider (CTP)’. The consolidated tape will bring together the prices and volumes of financial instruments, such as shares and bonds, from hundreds of execution venues across all Member states into a single stream of information, equally accessible for everybody.

The review contains also a prohibition of the practice of ‘payment for order flow’ (PFOF) to increase the quality of execution and the amount of retail orders being performed on transparent and competitive public markets.

In addition, the MiFIR review provides for improved rules on transparency of ‘non-equity instruments’ such as bonds and derivatives as well as a set of rules aimed at making robust markets for commodity derivatives.

Overall, the new rules increase the global competitiveness, better integrate EU capital markets and are a significant step towards a true capital markets union.

Mairead McGuinness, Commissioner for Financial Services, Financial Stability and Capital Markets Union, said:

“The political deal on the MiFIR review marks an important step towards the capital Markets Union and the integration of EU capital markets. Through various improvements to the transparency regime, such as the introduction of the consolidated tape and the harmonisation of the publication rules related to transactions in bonds, markets will be easier to navigate, and be more efficient and attractive for EU and international investors. I thank the co-legislators for obtaining such a good result.”

The new rules amending the Markets in Financial Instruments Regulation (MiFIR) are expected to apply from 1 January 2024, with certain elements of the regulation phasing in over the coming years.

Related links

2021 legislative package to ensure better data access and revamped investment rules

Investment services and regulated markets