Regulated Markets. Trading Venues

Abstract

In publication 2020-21,01 we dealt mainly with regulated markets with a look at the historical evolution over the last 30 years of the legislative framework that involved services and investment organizations. The introduction of legislative provisions aimed at harmonizing the regulation of markets, venues for the negotiation of financial instruments, at European level takes place with Directive 93/22/EEC with which the European Commission issues the first complete definition of regulated markets; the same definition refers to the directive 79/297/CEE for the conditions of admission to the quotation and to the directive 83/349/CEE for the control, relative to the consolidated accounts. A previous and less complete definition is issued with the directive 89/592/CEE which concerns the protection of regulated markets at a community level. We have been interested in the evolution of the dynamics concerning the market abuses that in a first phase have concerned the Community legislation regarding the abuse of insider trading (privileged information), subsequently, 14 years later, extended common legislative provisions are introduced for the protection of the market in consideration of the same evolution, provisions that consider market abuse to include not only abuse of privileged information but also market manipulation. We carried out a study of the MiFID II directive (Market in Financial Instruments Directive), the 2014/65/EU directive and related updates with reference to the regulated markets which must be applied together with the MiFIR regulation (Markets in financial instruments regulation), the Regulation (EU) 600/2014, which is also the subject of our studies. We are interested in the requirements applicable to regulated markets, negotiation and transparency, the obligation to negotiate OTC derivatives subject to the clearing obligation established by the EMIR regulation and belonging to a category for which ESMA has declared the obligation to negotiation. Interesting observations regarding investment services were possible with this study: the similarity between the financial services required for payment transactions with electronic money, excluding the exceptions sanctioned by the PSD2 directive, with the investment services necessary for the operations of investment, considered the exceptions sanctioned by the MiFID II directive; for example for an IDP it is possible to have direct access to the trading venues (negotiation code) by possessing the infrastructure and connections that allows it to operate as a participant or member in application of Article 53 paragraph 3, alternatively can invest through an "investment company" (that provides an electronic direct access and that includes infrastructure and connections or sponsored access, without infrastructure and connections). We took a look at payment systems both with systemic relevance and without, with particular interest in payment and securities settlement systems regulated at EU level through directive 98/26/EC as amended by directive 2009/44/EC; we are interested in the financial guarantee contracts and therefore in the directive 2002/47/CE as well as the common provisions for the comparability and transfer of the payment account with particular attention to the provisions issued by the directive 2014/92/EU for access to the accounts of payment with basic characteristics that for Italy in implementation of the decree-law adopting the directive, number 37 of 15 March 2017, they have also been extended to the payment institution and electronic money as well as to credit institutions.

Keywords: regulated markets, market manipulation, new rules for financial markets, trading venues, directive 2014/65/EU, MiFIR: transparency and negotiation obligation for derivatives, regulation (EU) 600/2014, settlement systems, payment systems and title settlement: directive 98/26/EC, financial guarantee,