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In the course of his speech he outlined the key elements needed to ensure the success of the EU's regulatory reform agenda:
The EU single rule book for financial markets needs to be implemented and supervised. Implementing measures like technical standards are needed to ensure that the legislation works in practice and the rules need to be subject to credible supervision; and
Supervisory convergence between the 28 EU member states is needed to ensure that the single rule book also results in a truly single EU financial market. Differences in supervision, and regulatory competition, will undermine the achievement of the objectives of stability and investor protection.
The existence of a liquid market basically divides the world of bonds and derivatives into those where real-time transparency applies on the pre-and post-trade sides and those where pre-trade can be waived and post-trade only applies on a deferred basis. ESMA will have to set specific quantitative parameters in order to assess whether a financial instrument has a liquid market. To that end we need to consider specific criteria when determining the quantitative thresholds aimed at assessing the liquidity of a market:
ESMA will carefully analyse the market model and the peculiar characteristics of bonds, because a bond’s liquidity might be driven by many other different factors such as issuance size, currency, maturity, credit quality, and seasonality.