In a statement on Friday 10 February, the European Federation of Savers and Financial Services Users (Better Finance) called on policymakers to “stop encouraging the expansion of large, mostly non-European systematic internalisers (SIs)”. It opposes the negotiating positions of the Council of the European Union and the European Parliament on the legislative proposal amending the ‘MiFIR’ Regulation and the ‘MiFID’ Directive governing markets in financial instruments (see EUROPE 13089/14).
The draft regulation aims to establish a centralised database or ‘consolidated tape’ which will provide access to market data from trading venues as well as systematic internalisers and approved publication arrangements across the EU in a consolidated manner.
The organisation wants the European Parliament to revert to the European Commission’s original proposal so as not to favour the establishment of a market structure which is beneficial for SIs. Large systematic internalisers are investment service providers that execute certain client orders outside a regulated market.
Better Finance also highlights the importance of prohibiting the detrimental payment for order flow (‘PFOF’) (see EUROPE 13089/14). “The introduction of a real-time pre-trade data ‘consolidated tape’ [...] would be instead enabling dark pools (SIs) to freeride even more on the regulated markets’ order books”, warned Guillaume Prache, managing director of Better Finance. (Original version in French by Anne Damiani)