To be reportable an instrument must be considered a financial instrument under Annex I Section C of MiFID II and be admitted to trading or traded on a trading venue within the scope of MiFID II.
When is a transaction reportable?
Under Article 26(2) MiFIR, the obligation in article 26(1) MiFIR for investment firms which execute transactions in financial instrument will apply if the instrument falls into one of the following three categories, irrespective of whether such transactions are carried out on the trading venue:
- Article 26(2)(a) financial instruments which are admitted to trading or traded on a trading venue or for which a request for admission to trading has been made. For the purposes of transaction reporting “traded on a trading venue” means that it is possible to trade the instrument on a trading venue, it doesn’t mean that the transaction was actually undertaken on a trading venue. For these purposes, when a request for admission to trading has been made, the financial instrument will be considered to be tradable and therefore maybe reportable.
- Article 26(2)(b) financial instruments where the underlying is a financial instrument traded on a trading venue. The underlying applicable to various categories of instruments is set out in field 47 (underlying instrument code) of Commission Delegated Regulation (EU) 2017/590.
- Article 26(2)(c) financial instruments where the underlying is an index or a basket composed of financial instruments traded on a trading venue. To be reportable under article 26(2)(c) the index (or indices) or basket only needs to include one financial instrument that is traded on a trading venue. Financial instruments that have more than one index as an underlying are also reportable under article 26(2)(c)
The obligation to transaction report applies to transactions in financial instruments referred to in Article 26(2)(a) to (c) above, irrespective of whether or not such transactions are carried out on the trading venue.
It is the responsibility of firms caught by the Article 26 MiFIR transaction reporting obligations to establish an appropriate process for identifying what transactions are reportable to us.
Under Article 15(g) of Commission Delegated Regulation (EU) 2017/565, firms and trading venues should have mechanisms to avoid reporting where the instrument does not fall within scope of Article 26(2) of MiFIR. Our Market Data Processor (MDP) system provides a pending mechanism to assist firms in managing their over-reporting. Read our reference data pages for more information on the process.
Article 26 of MiFIR defines what financial instruments are reportable
PERG 13 Guidance on the scope of MiFID and CRD IV for categories of financial instruments included in the different subsections of Annex 2, table 2
ESMA Instrument Reference Data: ESMA has published details of its instrument reference data files. It includes instructions on how to access and download all the data and delta reference data files from their website. The publication also identifies financial instruments in scope for MAR. Instruments not displayed on the list may still be reportable and firms should still undertake due diligence.