FESE sent letter to Commissioner Barnier regarding MiFID
04 April 2011
FESE stated that regulators can only close the current loopholes if they apply the same rules to the same activities. FESE is concerned about the potential proposal of creating a new, lighter-regulated venue category ('OTF') for activities that are currently covered by MiFID.
This would perpetuate the unlevel playing field and lead to greater complexity and regulatory arbitrage. Instead, FESE recommends tightening up the definitions of existing venue types, and clearly defining when the activity is not a platform. Hence, OTC should continue to exist but the regulatory flexibilities under the OTC label should only be used when the broker's activity does not constitute a trading platform.
© FESE
