51 Amendments of Arlene McCARTHY related to 2011/0298(COD)
Amendment 221 #
Proposal for a directive
Recital 8
Recital 8
(8) It is appropriate to include in the list of financial instruments certainall commodity derivatives and others which are constituted and traded in such a manner as to give rise to regulatory issues comparable to traditional financial instruments.
Amendment 224 #
Proposal for a directive
Recital 11
Recital 11
(11) It is necessary to establish a comprehensive regulatory regime governing the execution of transactions in financial instruments irrespective of the trading methods used to conclude those transactions so as to ensure a high quality of execution of investor transactions and to uphold the integrity and overall efficiency of the financial system. A coherent and risk-sensitive framework for regulating the main types of order-execution arrangement currently active in the European financial marketplace should be provided for. It is necessary to recognise the emergence of a new generation of organised trading systems alongside regulated markets whichand MTF which have benefited from a regulatory loophole under the current MiFID regime and that they should be subjected to obligations designed to preserve the efficient and orderly functioning of financial markets.
Amendment 225 #
Proposal for a directive
Recital 12
Recital 12
(12) All trading venues, namely regulated markets, MTFs, and OTFSystematic Internalisers, should lay down transparent rules governing access to the facility. However, while regulated markets and MTFs should continue to be subject to highly similar requirements regarding whom they may admit as members or participants, OTFSystematic Internalisers should be able to determine and restrict access based inter alia on the role and obligations which their operators have in ry have in relation to their clients. (This amendment (i.e. the delaetion to their clients.of "OTF") applies throughout the text. Adopting it will necessitate corresponding changes throughout.)
Amendment 232 #
Proposal for a directive
Recital 13
Recital 13
(13) An investment firm executing client orders against own proprietary capital should be deemed a systematic internaliser, unless the transactions are carried out on an over-the-counter (OTC) basis. OTC trading refers to bilateral trading outside regulated markets, MTFs and OMTFs on an occasional, ad hoc and irregular basis with eligible counterparties and at sizes above standard market size. Systematic internalisers should be defined as investment firms which, on an organised, frequent and systematic basis, deal on own account bywhen executing client orders outside a regulated market, an MTF or an OMTF. In order to ensure the objective and effective application of this definition to investment firms, any bilateral trading carried out with clients should be relevant and quantitative criteria should complement the qualitative criteria for the identification of investment firms required to register as systematic internalisers, laid down in Article 21 of Commission Regulation No 1287/2006 implementing Directive 2004/39/EC. While an OTF is any system or facility in which multiple third party buying and selling interests interact in the system, aA systematic internaliser should not be allowed to bring together third party buying and selling interests.
Amendment 291 #
Proposal for a directive
Recital 52
Recital 52
(52) In order to give all relevant information to investors, it is appropriate to require investment firms providing investment advice to clarify the basis of the advice they provide, notably the range of products they consider in providing personal recommendations to clients, whether they provide investment advice on an independent basis and whether they investment firm will provide the clients with the on-goinga periodic assessment of the suitability of the financial instruments recommended to them. It is also appropriate to require investment firms to explain their clients the reasons of the advice provided to them. In order to further define the regulatory framework for the provision of investment advice, while at the same time leaving choice to investment firms and clients, it is appropriate to establish the conditions for the provisions of this service when firms inform clients that the service is provided on an independent basis. In order to strengthen the protection of investors and increase clarity to clients as to the service they receive, it is appropriate to further restrict the possibility for firms to accept or receive inducements from third parties, and particularly from issuers, firms executing orders on behalf of clients or product providers, when providing the service of investment advice on an independent basis and the service of portfolio management. In such cases, only limited non-monetary benefits, such as training on the features of the products and for firms providing portfolio management, services related to execution of orders and research should be allowed subject to the condition that theyse services do not impair the ability of investment firms to pursueact in the best interest of their clients, as further clarified in Directive 2006/73/EC. To further protect consumers, it is also appropriate to ensure investment firms do not remunerate or assess the performance of their own staff in a way that conflicts with the firm's duty to act in the best interests of their clients, including by incentivising staff to favour a particular financial instrument in cases when another may better meet the client's needs.
Amendment 359 #
Proposal for a directive
Recital 108
Recital 108
(108) Technical standards in financial services should ensure consistent harmonisation and adequate protection of depositors, investors and consumers across the Union. As a body with highly specialised expertise, it would be efficient and appropriate to entrust ESMA, with the elaboration of draft regulatory and implementing technical standards which do not involve policy choices, for submission to the Commission. To ensure consistent investor and consumer protection across financial services sectors, ESMA should carry out its tasks, to the extent possible, in close cooperation with the other two ESAs within the framework of the Joint Committee.
Amendment 380 #
Proposal for a directive
Article 2 – paragraph 1 – point c
Article 2 – paragraph 1 – point c
(c) persons providing an investment service where that service is provided in an incidental manner in the course of a professional activity and that activity is regulated by legal or regulatory provisions or a code of ethics governing the profession which do not exclude the provision of that service;
Amendment 384 #
Proposal for a directive
Article 2 – paragraph 1 – point d – point ii a (new)
Article 2 – paragraph 1 – point d – point ii a (new)
(iia) engage in algorithmic trading;
Amendment 391 #
Proposal for a directive
Article 2 – paragraph 1 – point d – subparagraph 2
Article 2 – paragraph 1 – point d – subparagraph 2
Amendment 412 #
Proposal for a directive
Article 2 – paragraph 1 – point i – paragraph 1 – subparagraph 2 a (new)
Article 2 – paragraph 1 – point i – paragraph 1 – subparagraph 2 a (new)
unless they are a member or a participant on a trading venue;
Amendment 418 #
Proposal for a directive
Article 2 – paragraph 1 – subparagraph 1 a (new)
Article 2 – paragraph 1 – subparagraph 1 a (new)
Persons and firms as referred in points i, j and k shall not be considered exempted unless the relevant competent authority will grant the exemption.
Amendment 461 #
Proposal for a directive
Article 4 – paragraph 2 – point 6
Article 4 – paragraph 2 – point 6
6) ‘Market maker’ means a person who holds himself out on the financial markets on a continuous basis as being willing to deal on own account by buying and selling financial instruments against his proprietary capital at prices defined by him;
Amendment 462 #
Proposal for a directive
Article 4 – paragraph 2 – point 12
Article 4 – paragraph 2 – point 12
12) ‘Small and medium-sized enterprise’ for the purposes of this Directive, means a company that had an average market capitalisation of less than EUR 100 000 000 on the basis of end-year quotes for the previous three calendar years;refers to the existing national concepts in different Member States.
Amendment 489 #
Proposal for a directive
Article 4 – paragraph 2 – point 33 a (new)
Article 4 – paragraph 2 – point 33 a (new)
33a) 'Market distorting positions' means positions which do not objectively reduce risks directly related to commercial activities related to the commodity and are above the level required to provide sufficient liquidity for positions which do objectively reduce risks directly related to commercial activities related to the commodity, or which otherwise disrupt the price discovery function of the market;
Amendment 498 #
Proposal for a directive
Article 4 – paragraph 3
Article 4 – paragraph 3
3. The Commission shall be empowered to adopt delegated acts in accordance with Article 94 concerning measures to specify some technical elements of or amend the definitions laid down in paragraph 1 of this Article, to adjust them to market developmentsif appropriate, to take into account: (a) technical developments in financial markets; (b) the list of abusive practices referred to in Article 34b(b) of Regulation (EU) No …/… of the European Parliament and of the Council of ... [MAR] in particular with regard to high-frequency trading and including, but not limited to, spoofing, quote stuffing and layering.
Amendment 504 #
Proposal for a directive
Article 5 – paragraph 4 a (new)
Article 5 – paragraph 4 a (new)
4a. Member States shall require that individuals providing investment advice or, where appropriate, ancillary advice to clients, possess an appropriate level of knowledge and competence based on recognised qualifications. Member States shall also require that such individuals undergo professional training on an ongoing basis to update and validate their knowledge and competence.
Amendment 542 #
Proposal for a directive
Article 9 – paragraph 6 – subparagraph 1 – point c a (new)
Article 9 – paragraph 6 – subparagraph 1 – point c a (new)
(ca) define, approve and oversee the firm's remuneration of sales staff which should be designed to encourage responsible business conduct, fair treatment of consumers and to avoid conflicts of interest. The remuneration structure should be disclosed to customers where appropriate, such as where potential conflicts of interest cannot be managed or avoided;
Amendment 545 #
Proposal for a directive
Article 9 – paragraph 8 – subparagraph 2 – point ii
Article 9 – paragraph 8 – subparagraph 2 – point ii
(ii) the natural persons concerned are of sufficiently good repute, possess sufficient knowledge, skills and experience and commit sufficient time to perform their dutiesan appropriate level of knowledge and competence based on recognised qualifications and are given sufficient time to perform their duties and update and validate their knowledge and competence.
Amendment 561 #
Proposal for a directive
Article 16 – paragraph 7 – subparagraph 2
Article 16 – paragraph 7 – subparagraph 2
Records of telephone conversation or electronic communications recorded in accordance with sub-paragraph 1 shall be provided to the clients involved upon request and shall be kept for a period of threequal to the investment period of the client plus one year with a maximum of five years.
Amendment 573 #
Proposal for a directive
Article 16 a (new)
Article 16 a (new)
Article 16 a Market makers A market maker as defined in Article 4(6) shall regularly provide buy and sell quotations that are reasonable and related to the market. It shall remain in as continuous operation as possible during the trading hours of the regulated market or MTF to which it sends orders or through the system of which it executes transactions.
Amendment 582 #
Proposal for a directive
Article 17 – paragraph 2
Article 17 – paragraph 2
2. An investment firm that engages in algorithmic trading shall at least annually provide to its home Competent Authority a description of the nature of its algorithmic trading strategies, details of the trading parameters or limits to which the system is subject, the key compliance and risk controls that it has in place to ensure the conditions in paragraph 1 are satisfied and details of the testing of its systems. A competent authority may at any time request further information from an investment firmn investment firm shall, at the request of a competent authority, submit further information about its algorithmic trading and the systems used for that trading.
Amendment 614 #
Proposal for a directive
Article 18 – paragraph 1
Article 18 – paragraph 1
1. Member States shall require that investment firms or market operators operating an MTF or an OTF, in addition to meeting the requirements laid down in Article 16, establish transparent rules and procedures for fair and orderly trading and establish objective and non-discretionary criteria for the efficient execution of orders. They shall have arrangements for the sound management of the technical operations of the facility, including the establishment of effective contingency arrangements to cope with risks of systems disruption.
Amendment 626 #
Proposal for a directive
Article 18 – paragraph 8
Article 18 – paragraph 8
8. Member States shall require investment firms and market operators operating an MTF or an OTF to provide the competent authority with a detailed description of the functioning of the MTF or OTF, including any adjacent infrastructure that is part of their service offer and/ or any links to investment firms, trading firms, regulated markets, MTFs or systematic internalisers and/or order routing arrangements. Member States shall require investment firms and market operators operating an MTF to provide the competent authority with a detailed description of the arrangements it has in place to comply with the requirements provided in Articles 3 to 10 of Regulation (EU) No .../... [MiFIR]. Every authorisation to an investment firm or market operator as an MTF and an OTF shall be notified to ESMA. ESMA shall establish a list of all MTFs and OTFs in the Union. The list shall contain information on the services an MTF or an OTF providesprovides, including all the financial instruments admitted to trading on these platforms, and entail the unique code identifying the MTF and the OTF for use in reports in accordance with Article 23 and Articles 5 and 9 of Regulation (EU) No …/….../... [MiFIR]. It shall be updated on a regular basis. ESMA shall publish and keep up-to-date that list on its website.
Amendment 628 #
Proposal for a directive
Article 18 – paragraph 8 a (new)
Article 18 – paragraph 8 a (new)
Amendment 638 #
Proposal for a directive
Article 19 – paragraph 4 a (new)
Article 19 – paragraph 4 a (new)
4a. Member States shall require that the trading platform has at least four materially active members or users, each having the opportunity to interact with all the others in respect to price formation in the system.
Amendment 675 #
Proposal for a directive
Article 23 – paragraph 3 – point b
Article 23 – paragraph 3 – point b
(b) establish appropriate criteria for determining the types of conflict of interest whose existence may damage the interests of the clients or potential clients of the investment firm. Areas covered should include, as a minimum, the use of sales targets for investment products, remuneration, rewards or payments in kind paid to its employees or agents involved in the advising on or selling of financial instruments to retail clients and the performance reviews of employees or agents which provide incentives for those employees or agents to act otherwise than in the best interests of each individual retail client.
Amendment 697 #
Proposal for a directive
Article 24 – paragraph 3 – subparagraph 1 – indent 1
Article 24 – paragraph 3 – subparagraph 1 – indent 1
– the investment firm and its services; when investment advice is provided, information shall specify in advance whether the advice is provided on an independent basis and whether it is based on a broad or on a more restricted analysis of the market and shall indicate whether the investment firm will provide the client with the on-goinga periodic assessment of the suitability of the financial instruments recommended to clients,
Amendment 705 #
Proposal for a directive
Article 24 – paragraph 3 – subparagraph 1 – indent 3
Article 24 – paragraph 3 – subparagraph 1 – indent 3
– execution venues; when client orders are routed to an execution venue, information shall specify the relationships the investment firm maintains with this execution venue, which may include, but are not limited to routing arrangements, potential for earning maker rebates, shareholdings and ownership,
Amendment 711 #
Proposal for a directive
Article 24 – paragraph 3 – subparagraph 1 – indent 4
Article 24 – paragraph 3 – subparagraph 1 – indent 4
– costs and associated charges, which must include the cost of advice and payment method.
Amendment 715 #
Proposal for a directive
Article 24 – paragraph 3 – subparagraph 2
Article 24 – paragraph 3 – subparagraph 2
The information referred to in the first subparagraph should be provided in a comprehensible form in such a manner that clients or potential clients are reasonably able to understand the nature and risks of the investment service and of the specific type of financial instrument that is being offered and, consequently, to take investment decisions on an informed basis. TMember States may require that this information may beis provided in a standardised format.
Amendment 737 #
Proposal for a directive
Article 24 – paragraph 5 – point i
Article 24 – paragraph 5 – point i
(i) shall assess a sufficiently large number of financial instruments available on the marketcarry out a comprehensive and fair analysis of the relevant market and provide advice which is unbiased and unrestricted. The financial instruments should be diversified with regard to their type and issuers or product providers and should not be limited to financial instruments issued or provided by entities having close links with the investment firm,
Amendment 749 #
Proposal for a directive
Article 24 – paragraph 5 – point ii
Article 24 – paragraph 5 – point ii
(ii) shall not accept or receive fees, commissions or any monetary benefits paid or provided by any third party or a person acting on behalf of a third party in relation to the provision of the service to clients but only be remunerated through charges payable by or on behalf of the client.
Amendment 771 #
Proposal for a directive
Article 24 – paragraph 6 a (new)
Article 24 – paragraph 6 a (new)
6a When providing investment advice or portfolio management a firm and anyone acting on behalf of the investment firm, shall, in relation to these services: (i) not accept or receive fees, commissions or any benefits paid or provided by any third party or a person acting on behalf of a third party but only be remunerated through charges payable by or on behalf of the client; (ii) clearly disclose to the client a tariff of its charges and, where the firm offers services in relation to one or more in- house financial instruments, ensure that the charges are presented separately from charges for any financial instrument; (iii) ensure that neither the remuneration, rewards or payments in kind paid to its employees or agents involved in the advising on or selling of financial instruments to retail clients, nor the performance reviews of such employees or agents, provide any incentive for those employees or agents to act otherwise than in the best interests of each individual retail client; (iv) inform the client whether the financial instruments recommended will be limited to financial instruments issued or provided by entities having close links with the investment firm.
Amendment 780 #
Proposal for a directive
Article 24 – paragraph 7 – subparagraph 2
Article 24 – paragraph 7 – subparagraph 2
ESMA, in cooperation with EBA and EIOPA, through the Joint Committee, shall develop by [] at the latest, and update periodically, guidelines for the assessment and the supervision of cross- selling practices indicating, in particular, situations in which cross-selling practices are not compliant with obligations in paragraph 1.
Amendment 851 #
Proposal for a directive
Article 27 – paragraph 5 – subparagraph 2
Article 27 – paragraph 5 – subparagraph 2
Member States shall require investment firms to summarize and make public on an annual monthly basis, for each class of financial instruments, the top five execution venues in terms of trading volumes sent where they executed client orders in the preceding yearmonths, with data on execution quality, and potential price improvements received for the execution of these client orders on these execution venues. This data shall be calculated by independent third parties.
Amendment 865 #
Proposal for a directive
Article 29 – paragraph 3 – subparagraph 2
Article 29 – paragraph 3 – subparagraph 2
Member States shall ensure that tied agents are only admitted to the public register ifonce it has been established that they are of sufficiently good repute and that they possess an appropriate general, commercial and professional knowledgelevel of knowledge and competence based on recognised qualifications so as to be able to communicate accurately all relevant information regarding the proposed service to the client or potential client. Tied agents shall be required to undergo professional training on an ongoing basis to update and validate their knowledge and competence.
Amendment 903 #
Proposal for a directive
Article 35 – paragraph 7
Article 35 – paragraph 7
7. Member States shall require that where a financial instrument of an issuer is admitted to trading on one SME growth market, the financial instrument may alsoonly be traded on another SME growth market without the consent of the issuer. In such a case however, the issuer shall not be subject to any obligation relating to corporate governance or initial, ongoing or ad hoc disclosure with regard to the latter SME market.
Amendment 987 #
Proposal for a directive
Article 51 – paragraph 1
Article 51 – paragraph 1
1. Member States shall require a regulated market or MTF to have in place effective systems, procedures and arrangements to ensure its trading systems are resilient, have sufficient capacity to deal with peak order and message volumes, are able to ensure orderly trading under conditions of market stress, are fully tested to ensure such conditions are met and are subject to effective business continuity arrangements to ensure continuity of its services if there is any unforeseen failure of its trading systems. (This Amendment applies throughout Article 51. Adopting it will necessitate corresponding changes to it.)
Amendment 1022 #
Proposal for a directive
Article 51 – paragraph 4 a (new)
Article 51 – paragraph 4 a (new)
4a. Member States shall require regulated markets and MTFs to set in place a threshold that limits the share of orders entered by a market member compared to the overall order book.
Amendment 1026 #
Proposal for a directive
Article 51 – paragraph 5
Article 51 – paragraph 5
5. Member States shall require a regulated market or MTF to ensure that its rules on co- location services and fee structures are transparent, fair and non-discriminatory. The fee structure shall not create incentives to place orders or to execute transactions in a way which contributes to disorderly trading conditions or market abuse. In particular, in order to reflect the additional burden on system capacity, Member States shall require a regulated market or MTF to impose a higher fee on participants that place a ratio of cancelled orders to executed orders that exceeds 4:1.
Amendment 1097 #
Proposal for a directive
Article 59 – paragraph 1 – subparagraph 1 – introductory part
Article 59 – paragraph 1 – subparagraph 1 – introductory part
Member States shall ensure that regulated markets, operators of MTFcompetent authorities apply to regulated markets and OMTFs which admit to trading or trade commodity derivatives apply limits on the number of contracts which any given market members or participants, or class of market members or participants, can enter into over a specified period of time, or alternative arrangements with equivalent effect such as position management with automatic review thresholds , to be imposed in order to:
Amendment 1108 #
Proposal for a directive
Article 59 – paragraph 1 – subparagraph 1 – point c a (new)
Article 59 – paragraph 1 – subparagraph 1 – point c a (new)
(c a) ensure price discovery for the physical market;
Amendment 1111 #
Proposal for a directive
Article 59 – paragraph 1 – subparagraph 1 – point c b (new)
Article 59 – paragraph 1 – subparagraph 1 – point c b (new)
(cb) prevent the build-up of market distorting positions.
Amendment 1116 #
Proposal for a directive
Article 59 – paragraph 1 – subparagraph 2
Article 59 – paragraph 1 – subparagraph 2
The limits or arrangements shall be transparent and non- discriminatory, specifying the persons to whom they apply and any exemptions, and taking account of the nature and composition of market participants and of the use they make of the contracts admitted to trading. In particular, they shall differentiate between positions which objectively reduce risks directly related to commercial activities related to the commodity, and other positions. They shall specify clear quantitative thresholds such as the maximum number of contracts persons can enter, taking account of the characteristics of the underlying commodity market, including patterns of production, consumption and transportation to market. They shall apply to both cash-settled and physically-settled contracts and for spot, single and all delivery month(s).
Amendment 1129 #
Proposal for a directive
Article 59 – paragraph 2
Article 59 – paragraph 2
2. Regulated markets, MTF and OMTFs shall inform their competent authority of the details of the limits or arrangements. The competent authority shall communicate the same information to ESMA which shall publish and maintain on its website a database with summaries of the limits or arrangements in force.
Amendment 1134 #
Proposal for a directive
Article 59 – paragraph 3
Article 59 – paragraph 3
3. The Commission shall be empowered to adopt delegated acts in accordance with Article 94 to determine (a) the limits or alternative arrangements on the number of contracts which any person can enter into over a specified period of time and the necessary equivalent effects of the alternative arrangements established in accordance with paragraph 1, as well as the conditions for exemptions. The limits or alternative arrangements shall take account of the conditions referred to in paragraph 1 and the limits that have been set by regulated markets, MTFs and OTFs. The limits or alternative arrangemen, (b) the proportion of contracts held across regulated market and MTF on commodity derivatives which do not objectively reduce risks directly related to commercial activities related to the commodity, versus contracts which do, (c) additional controls needed to ensure orderly operation of markets, and (d) the conditions for exemptions and for determining when positions objectively reduce risks directly related to commercial activities relating to the commodity. The limits shall take account of the conditions referred to in paragraph 1, the need for appropriate differentiation between commodities and categories of market participants, and the limits that have been set by trading venues. The limits determined in the delegated acts shall also take precedence over any measures imposed by competent authorities pursuant to Article 72(1) paragraph (g) of this Directive.
Amendment 1141 #
Proposal for a directive
Article 59 – paragraph 4
Article 59 – paragraph 4
Amendment 1160 #
Proposal for a directive
Article 60 – paragraph 1 a (new)
Article 60 – paragraph 1 a (new)
1 a. Member States shall ensure that investment firms trading in commodity derivatives or emission allowances or derivatives thereof outside of a trading venue provide the competent authority, upon request, with a complete breakdown of their positions, in accordance with Article 23 of Regulation (EU) No .../... [MiFIR].
Amendment 1171 #
Proposal for a directive
Article 60 – paragraph 3 – subparagraph 2
Article 60 – paragraph 3 – subparagraph 2
The reports mentioned in point (a) of paragraph 1 shouldall specify the number of long and short positions by category of trader, changes thereto since the previous report, percent of total open interest represented by each category, and the number of traders in each category. The reports mentioned in point (a) of paragraph 1 and in paragraph 1a shall also differentiate between: (i) positions that have been identified as positions which objectively reduce risks directly related to commercial activities related to the commodity; (ii) other positions.
Amendment 1176 #
Proposal for a directive
Article 60 – paragraph 4 – subparagraph 1
Article 60 – paragraph 4 – subparagraph 1
ESMA shall develop draft implementing technical standards to determine the format of the reports mentioned in point (a) ofaragraph 1 and in paragraph 1,a and the content of the information to be provided in accordance with paragraph 2.
Amendment 1276 #
Proposal for a directive
Article 91 a (new)
Article 91 a (new)
Article 91a ESMA advisory committee on high- frequency trading By 30 June 2014, ESMA shall set up an advisory committee of national experts to determine developments of high- frequency trading that could potentially constitute market manipulation with a view to: (a) increasing ESMA's knowledge about high-frequency trading; and (b) providing a list of abusive practices with regard to high-frequency trading, including spoofing, quote stuffing and layering, for the purpose of Article 5(1a) of Regulation (EU) No .../2012 of the European Parliament and of the Council of ... [MAR].