ECMI: Bond market transparency - To regulate or not to regulate

12 December 2006

This ECMI Policy Brief attempts to contribute to the ongoing policy debate on MiFID art. 65.1. It presents the pros and cons of introducing greater transparency into the marketplace, including a model on the possible impact of increasing transparency.

The paper also highlights the insufficient level of data available to market participants and regulators on volumes and aggregate bond market activity, as well as the lack of appropriate information made available to retail investors, suggesting that dealers may have little time to come up with a solution, and that an industry code of conduct may be an appropriate avenue – and one preferable to legislative initiatives – for introducing more transparency uniformly across the EU.

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