Open access regime for the trading and clearing of exchange-traded derivatives

Since we published the statement below, the EU co-legislators agreed that considering the adverse circumstances arising from the COVID-19 pandemic it was appropriate to amend MiFIR to give one additional year for trading venues and CCPs offering trading and clearing of exchange-traded derivatives to start applying open access rules. The relevant provisions will therefore not apply until 4 July 2021. The amendment will form part of the EU retained law and will continue to apply in the UK after the end of the transition period. 

Statement of 11 June 2020

From 4 July 2020 trading venues and central counterparties (CCPs) offering the trading and clearing of exchange-traded derivatives will be subject to the Markets in Financial Instruments Regulation (MiFIR) open access regime as set out in articles 35 and 36 of that Regulation. Under those provisions, trading venues and CCPs may only deny access where the operational risk and complexity arising from granting access would cause undue risk. The specific factors trading venues and CCPs should consider when evaluating access requests are set out in Commission Delegated Regulation 2017/587.

To meet their responsibilities, trading venues and CCPs are expected to put in place processes to assess any open access requests against those factors. The operation of these processes will require senior management, legal, risk, compliance and IT resources. Responding to an open access request in current market conditions while relevant staff are working from home is likely to involve extra resources and operational complexity that would introduce additional elements of risk and may detract from the priority of maintaining resilient and orderly markets.

When making or assessing open access requests, trading venues should continue to prioritise the maintenance of orderly markets and the continuity of their critical services to the market even if this may delay the assessment of an open access request. Where a recipient delays an assessment, it should communicate its position to the requester without delay. We will monitor any requests received by FCA-regulated venues.

ESMA’s statement recommends relevant Competent Authorities have regard to the risks raised by COVID-19 in relation to open access for exchange traded derivatives. We support the approach set out in the statement.