S.I. No. 375/2017 - European Union (Markets in Financial Instruments) Regulations 2017

• (a) defines and oversees the implementation of the governance arrangements that ensure effective and prudent management of the organisation, including the segregation of duties in the organisation and the prevention of conflicts of interest, and in a manner that promotes the integrity of the market,

• (b) monitors, and periodically assesses, the effectiveness of the market operator’s governance arrangements and takes appropriate steps to address any deficiencies,

• (c) has adequate access to information and documents which are needed to oversee and to monitor management decision-making.

• (3) The market operator shall notify the Bank of the identity of all members of its management body and of any changes to its membership, together with all information needed to assess compliance with Regulations 66 and 67 and this Regulation.

Requirements relating to persons exercising significant influence over management of regulated market

• (2) The market operator of a regulated market shall—

• (a) provide the Bank with all information that the Bank may request regarding—

• (i) the ownership of the regulated market,

• (ii) the ownership of the market operator, and

• (iii) the identity and scale of interests of any parties in a position to exercise significant influence over the management of the regulated market,

• (b) inform the Bank of any transfer of ownership which gives rise to a change in the identity of the persons exercising significant influence over the operation of the regulated market, and

• (c) make public the information referred to in subparagraphs (a) and (b) in the manner and at the times that the Bank may direct.

• (3) The Bank shall refuse to approve proposed changes to the controlling interests of the regulated market or the market operator of a regulated market if there are objective and demonstrable grounds for believing the proposed changes would pose a threat to the sound and prudent management of the regulated market.

Organisational requirements

• (a) have arrangements to identify clearly and manage the potential adverse consequences, for the operation of the regulated market or for its members or participants, of any conflict of interest between—

• (i) the interest of the regulated market, its owners or its market operator, and

• (ii) the sound functioning of the regulated market,

in particular where such conflicts of interest might prove prejudicial to the accomplishment of any functions delegated to the regulated market by the Bank,

• (b) be adequately equipped to—

• (i) manage the risks to which it is exposed,

• (ii) implement appropriate arrangements and systems to identify all significant risks to its operation, and

• (iii) put in place effective measures to mitigate those risks,

• (c) have arrangements for the sound management of the technical operations of the system, including the establishment of effective contingency arrangements to cope with risks of systems disruptions,

• (d) have transparent and non-discretionary rules and procedures that provide for fair and orderly trading and establish objective criteria for the efficient execution of orders,

• (e) have effective arrangements to facilitate the efficient and timely finalisation of transactions executed under its systems;

• (f) have available, at the time of authorisation and on an ongoing basis, sufficient financial resources to facilitate its orderly functioning, having regard to the nature and extent of the transactions concluded on the market and the range and degree of the risks to which it is exposed.

Execution of client orders, etc. in certain circumstances: prohibition

Systems resilience, circuit breakers and electronic trading

• (a) are resilient,

• (b) have sufficient capacity to deal with peak order and message volumes,

• (c) are able to ensure orderly trading under conditions of severe market stress,

• (d) are able to reject orders that exceed predetermined volume and price thresholds or are clearly erroneous, and

• (e) ensure that algorithmic trading systems cannot create or contribute to disorderly trading conditions on the market and manage any disorderly trading conditions which do arise from such algorithmic trading systems, including—

• (i) by requiring members or participants to carry out appropriate testing of algorithms and providing environments to facilitate such testing, and

• (ii) by limiting the ratio of unexecuted orders to transactions that may be entered into the system by a member or participant, by being able to slow down the flow of orders if there is a risk of its system capacity being reached and by limiting and enforcing the minimum tick size that may be executed on the market,

and that are fully tested to ensure the conditions in subparagraphs (a), (b) and (c) are met and are subject to effective business continuity arrangements to ensure continuity of its services if there is any failure of its trading systems.

• (2) A regulated market shall have binding written agreements with all investment firms pursuing a market making strategy on the regulated market specifying—

• (a) the obligations of the investment firm in relation to the provision of liquidity, and

• (b) any incentives in terms of rebates or otherwise offered by the regulated market to an investment firm so as to provide liquidity to the market on a regular and predictable basis.

• (3) A regulated market must, where it is appropriate to the nature and scale of the trading on the regulated market, have in place schemes to ensure that a sufficient number of investment firms participate in agreements such as are mentioned in paragraph (2) which require them to post firm quotes at competitive prices with the result of providing liquidity to the market on a regular and predictable basis.

• (4) Agreements such as are mentioned in paragraph (2) shall specify any obligation arising from participation in a scheme such as is mentioned in paragraph (2) and any other rights accruing to an investment firm as a result of participation in such a scheme.

• (5) A regulated market shall—

• (a) monitor and enforce compliance by investment firms with the requirements of agreements such as are mentioned in paragraph (2),

• (b) inform the Bank about the content of such agreements, and

• (c) provide, on request, all further information to the Bank necessary to enable the Bank to satisfy itself of compliance by the regulated market with paragraphs (2) and (4).

• (6) A regulated market shall be able to temporarily halt or constrain trading if there is a significant price movement in a financial instrument on that market or a related market during a short period and, in exceptional cases, to be able to cancel, vary or correct any transaction.

• (7) A regulated market shall ensure that the parameters for halting trading are appropriately calibrated in a way which—

• (a) takes into account the liquidity of different asset classes and sub-classes, the nature of the market model and types of users, and

• (b) is sufficient to avoid significant disruptions to the orderliness of trading.

• (8) A regulated market shall report such parameters and any material changes to those parameters to the Bank in a consistent and comparable manner and the Bank shall in turn report them to ESMA.

• (9) Where a regulated market which is material in terms of liquidity in a financial instrument halts trading it shall have the necessary systems and procedures in place to ensure that it notifies the Bank in order for the Bank—

• (a) to coordinate a market wide response, and

• (b) determine whether it is appropriate to halt trading on other venues on which the financial instrument is traded until trading resumes on the original market.

• (10) A regulated market that permits direct electronic access shall have in place effective systems procedures and arrangements to ensure—

• (a) that members and participants are only permitted to provide such services if they are investment firms authorised under these Regulations or credit institutions authorised in accordance with Directive 2013/36/EU,

• (b) that appropriate criteria are set and applied regarding the suitability of persons to whom such access may be provided, and

• (c) that a member or participant retains responsibility for orders and trades executed using that service in relation to the requirements of these Regulations.

• (11) A regulated market shall—

• (a) set appropriate standards regarding risk controls and thresholds on trading through direct electronic access,

• (b) be able to distinguish and, if necessary, to stop orders or trading by a person using direct electronic access separately from other orders or trading by the member or participant, and

• (c) have arrangements in place to suspend or terminate the provision of direct electronic access by a member or participant to a client in the case of non-compliance with this paragraph.

• (12) A regulated market shall ensure that its rules on co-location services are transparent, fair and non-discriminatory.

• (13) A regulated market shall ensure that its fee structures including execution fees, ancillary fees and rebates—

• (a) are transparent, fair and non-discriminatory,

• (b) do not create incentives to place, modify or cancel orders or to execute transactions in a way which contributes to disorderly trading conditions or market abuse, and

• (c) in particular, do not impose market making obligations in individual shares or a suitable basket of shares in exchange for any rebates that are granted.

• (14) A regulated market may adjust its fees for cancelled orders according to the length of time for which the order was maintained and to calibrate the fees to each financial instrument to which they apply.

• (15) A regulated market may impose a higher fee for placing an order that is subsequently cancelled than an order which is executed and to impose a higher fee on participants placing a high ratio of cancelled orders to executed orders and on those operating a high-frequency algorithmic trading technique in order to reflect the additional burden on system capacity.

• (16) A regulated market shall be able to identify, by means of flagging from members or participants, orders generated by algorithmic trading, the different algorithms used for the creation of orders and the relevant persons initiating those orders and to provide, on request, such information to the Bank.

• (17) A regulated market shall, on request, make available to the Bank data relating to the order book or give the Bank access to the order book so that it is able to monitor trading.

Tick sizes

• (2) A tick size regime shall—

• (a) be calibrated to reflect the liquidity profile of the financial instrument in different markets and the average bid-ask spread, taking into account the desirability of enabling reasonably stable prices without unduly constraining further narrowing of spreads, and

• (b) adapt the tick size for each financial instrument appropriately.

Synchronisation of business clocks

Admission of financial instruments to trading

• (2) The rules shall ensure that any financial instruments admitted to trading in a regulated market—

• (a) are capable of being traded in a fair, orderly and efficient manner, and

• (b) in the case of transferable securities, are freely negotiable.

• (3) In the case of derivatives, the rules shall ensure in particular that the design of the derivative contract allows for its orderly pricing as well as for the existence of effective settlement conditions.

• (4) In addition to the obligations under paragraphs (1) to (3), the regulated market shall establish and maintain effective arrangements—

• (a) to verify that issuers of transferable securities that are admitted to trading on the regulated market comply with their obligations under European Union law in respect of initial, ongoing and ad hoc disclosure obligations, and

• (b) which facilitate the regulated market’s members or participants in obtaining access to information which has been made public under European Union law.

• (5) The regulated market shall establish the necessary arrangements to review regularly the compliance with the admission requirements of the financial instruments which the regulated market admits to trading.

• (6) A transferable security that has been admitted to trading on a regulated market may subsequently be admitted to trading on other regulated markets—

• (a) without the consent of the issuer, and

• (b) in compliance with the relevant provisions of the Prospectus (Directive 2003/71/EC) Regulations 2005.

• (7) The regulated market shall inform the issuer of the fact that the issuer’s securities are traded on the regulated market.

• (8) The issuer is not subject to any obligation to provide information required under paragraph (4) directly to any regulated market which has admitted the issuer’s securities to trading without the issuer’s consent.

Suspension and removal of instruments from trading on regulated market

• (a) the investors’ interests, or

• (b) the orderly functioning of the market.

• (2) Without prejudice to paragraph (1), the Bank may require—

• (a) the suspension of trading in a financial instrument,

• (b) the removal of a financial instrument from trading, whether on a regulated market or under other trading arrangements,

• (c) the suspension of the marketing or sale of financial instruments or structured deposits where the conditions of Article 40, 41 or 42 of Regulation (EU) No 600/2014 are met, or

• (d) the suspension of the marketing or sale of financial instruments or structured deposits where the investment firm has not developed or applied an effective product approval process or otherwise failed to comply with paragraphs (1)(b) to (m), (2) and (3) of Regulation 23.

• (3) A market operator that suspends or removes from trading a financial instrument shall also suspend or remove the derivatives referred to in paragraphs 4 to 10 of Part 3 of Schedule 1 that relate or are referenced to that financial instrument where necessary to support the objectives of the suspension or removal of the underlying financial instrument.

• (4) The market operator shall—

• (a) make public the suspension or removal, and

• (b) communicate all relevant information to the Bank,

and the Bank shall inform the competent authorities of the other Member States.

• (5) The Bank shall require that other regulated markets, MTFs, OTFs and systematic internalisers for which it is the competent authority and trade the same financial instrument or derivatives as referred to in paragraphs 4 to 10 of Part 3 of Schedule 1 that relate or are referenced to a financial instrument that has been suspended also suspend or remove that financial instrument or those derivatives from trading, where the suspension or removal is due to—

• (a) suspected market abuse,

• (b) a takeover bid, or

• (c) the non-disclosure of inside information about the issuer or financial instrument infringing Articles 7 and 17 of Regulation (EU) No 596/2014,

except where such suspension or removal could cause significant damage to the investors’ interests or the orderly functioning of the market.

(6)(a) Where the Bank requires the suspension or removal of a financial instrument from trading on one or more regulated markets the Bank shall without delay make public its decision and communicate this decision to ESMA and the competent authorities of the other Member States.

• (b) Where the Bank makes a decision not to suspend or remove from trading the financial instrument or derivatives referred to in paragraphs 4 to 10 of Part 3 of Schedule 1 that relate or are referenced to that financial instrument it shall communicate its decision to the competent authorities of the other Member States and ESMA and provide an explanation for this decision.

• (7) Where the Bank is informed by the competent authority of another Member State of the suspension or removal of a financial instrument or derivative referred to in paragraphs 4 to 10 of Part 3 of Schedule 1 that relate or are referenced to that financial instrument from trading on one or more of its regulated markets, MTFs, OTFs or systematic internalisers, the Bank shall direct the suspension or removal of that financial instrument or derivative from trading, where the suspension or removal is due to—

• (a) suspected market abuse,

• (b) a takeover bid, or

• (c) the non-disclosure of inside information about the issuer or financial instrument infringing Articles 7 and 17 of Regulation (EU) No 596/2014,

except where such suspension or removal could cause significant damage to the investors’ interests or to the orderly functioning of the market.

• (8) The notification procedure referred to in paragraph (6) shall also apply—

• (a) when the suspension from trading of a financial instrument or derivative as referred to in paragraphs 4 to 10 of Part 3 of Schedule 1 that relate or are referenced to that financial instrument is lifted, or

• (b) where the decision to suspend or remove from trading a financial instrument or derivative as referred to in paragraphs 4 to 10 of Part 3 of Schedule 1 that relates or is referenced to that financial instrument is taken by the Bank pursuant to Regulation 92(4)(m) and (n).

Access to regulated market

• (2) The regulated market shall ensure that its rules specify any obligations for the members or participants arising from—

• (a) the constitution and administration of the regulated market,

• (b) rules relating to transactions on the regulated market,

• (c) professional standards imposed on the staff of the investment firms or credit institutions that are operating on the market,

• (d) the conditions established, for members or participants other than investment firms and credit institutions, under paragraph (3), and

• (e) the rules and procedures for the clearing and settlement of transactions concluded on the regulated market.

• (3) The regulated market may only admit as members or participants investment firms, credit institutions authorised in accordance with Directive 2013/36/EU and other persons who—

• (a) are of good repute,

• (b) have a sufficient level of trading ability, competence and experience,

• (c) have, where applicable, adequate organisational arrangements, and

• (d) have sufficient resources for the role they are to perform, taking into account the different financial arrangements that the regulated market may have established in order to guarantee the adequate settlement of transactions.

• (4) For transactions concluded on a regulated market, members and participants are not obliged to apply to each other the obligations provided for in Regulations 31 to 33, 35 and 36 but the members or participants of the regulated market shall apply the obligations provided for in those Regulations with respect to their clients when they, acting on behalf of their clients, execute their orders on a regulated market.

• (5) Regulated markets shall ensure that their rules on access to or membership of or participation in their regulated market shall provide for the direct or remote participation of investment firms and credit institutions.

• (6) A regulated market in another Member State may provide appropriate arrangements in the State to facilitate access to and trading on that market by remote members or participants established in the State, without further legal or administrative requirements.

• (7) Where a regulated market is authorised in the State and wishes to conduct business in another Member State—

• (a) the regulated market shall communicate to the Bank—

• (i) the name of the other Member State, and

• (ii) the regulated market’s intention to conduct business in the other Member State and to make arrangements in that regard,

and

• (b) within one month after the communication under subparagraph (a), the Bank shall in turn communicate to the competent authority of the other Member State the information referred to in subparagraph (a).

• (8) The Bank, at the request of the competent authority referred to in paragraph (7)(b) and without undue delay, shall communicate to the competent authority the identity of the members and participants of the regulated market authorised in the State.

• (9) The regulated market shall communicate to the Bank, on a regular basis, a list of the members or participants of the regulated market.

Monitoring of compliance with rules of regulated market and with other legal obligations

• (a) establish and maintain effective arrangements and procedures, including the necessary resources, for the regular monitoring of the compliance by its members and participants with the rules of the regulated market, and

• (b) monitor orders sent, including cancellations, and transactions undertaken by the regulated market’s members and participants, under its systems, in order to identify, in relation to those transactions, any—

• (i) infringements of the rules of the regulated market,

• (ii) disorderly trading conditions,

• (iii) conduct that may indicate behavior that is prohibited under Regulation (EU) No 596/2014, or

• (iv) system disruptions in relation to a financial instrument.

• (2) The market operator of a regulated market shall—

• (a) immediately report to the Bank, in relation to any transactions referred to in paragraph (1)(b), any—

• (i) significant infringements of the rules of the regulated market,

• (ii) disorderly trading conditions,

• (iii) conduct that may indicate behavior that is prohibited under Regulation (EU) No 596/2014, or

• (iv) system disruptions in relation to a financial instrument,

• (b) supply to the Bank without undue delay the relevant information about any matter referred to in subparagraph (a), and

• (c) provide full assistance to the Bank in investigating and prosecuting market abuse occurring on or through the systems of the regulated market.

• (3) The Bank shall notify the competent authorities of the other Member States and ESMA of information received pursuant to paragraph (2), but in the instance of conduct that may indicate behaviour that is prohibited under Regulation (EU) No 596/2014, the Bank must be convinced that such behaviour is being or has been carried out before it notifies the competent authorities of the other Member States and ESMA.

Provisions regarding central counterparty and clearing and settlement arrangements

• (a) a central counterparty, or

• (b) a clearing house and a settlement system,

of another Member State, with a view to providing for the clearing, settlement or both of some or all trades concluded by market participants under the other Member State’s settlement system.

• (2) Without prejudice to Titles III, IV or V of Regulation (EU) No 648/2012, the Bank may not oppose the use by a regulated market of central counterparty, clearing houses or settlement systems in another Member State except as demonstrably necessary in order to maintain the orderly functioning of that regulated market and taking into account the conditions for settlement systems established under Regulation 46(3).

List of regulated markets

• (a) prepare and keep a list of the regulated markets for which the State is the home Member State,

• (b) amend the list as necessary to keep it current,

• (c) forward the list and any amendments to it to the other Member States and ESMA, and

• (d) include in the list the unique code given to the regulated market by ESMA.

PART 8 POSITION LIMITS AND POSITION MANAGEMENT CONTROLS IN COMMODITY DERIVATIVES AND REPORTING

Position limits and position management in commodity derivatives positions

• (2) Position limits do not apply to positions which are held by or on behalf of a non-financial entity and which are objectively measurable as reducing risks directly relating to the commercial activity of the non-financial entity.

• (3) Position limits shall be set on the basis of all positions held either by a person or on the person’s behalf at aggregate group level in order to—

• (a) prevent market abuse, or

• (b) support orderly pricing and settlement conditions, including preventing market distorting positions and ensuring, in particular, convergence between prices of derivatives in the delivery month and spot prices for the underlying commodity, without prejudice to price discovery on the market for the underlying commodity.

• (4) Position limits shall specify clear quantitative thresholds for the maximum size of a position in a commodity derivative that persons can hold.

• (5) The Bank shall set limits for each contract in commodity derivatives traded on trading venues, including economically equivalent OTC contracts, based on the methodology for calculation determined by ESMA in accordance with Article 57(3) of the Directive.

• (6) The Bank shall review position limits where there is a significant change in deliverable supply or open interest or any other significant change on the market, based on its determination of deliverable supply and open interest, and reset the position limit in accordance with the methodology for calculation determined by ESMA under Article 57(3) of the Directive.

• (7) The Bank shall notify ESMA of the exact position limits it intends to set in accordance with the methodology for calculation determined by ESMA under Article 57(3) of the Directive.

• (8) The Bank shall modify the position limits in accordance with any opinion issued by ESMA or provide ESMA with justification why the change is considered unnecessary.

• (9) Where the Bank imposes limits contrary to an ESMA opinion, it shall immediately publish on its website a notice fully explaining its reasons for so doing.

• (10) The Bank, in the exercise of its supervisory powers under these Regulations, may—

• (a) require or demand the provision of information including all relevant documentation from any person regarding the size and purpose of a position or exposure entered into via a commodity derivative and any assets or liabilities in the underlying market,

• (b) request any person to take steps to reduce the size of the position or exposure, or

• (c) limit the ability of any person from entering into a commodity derivative, to include the introduction of limits on the size of a position any person can hold at all times in accordance with Regulation 92(4)(p).

• (11) Where the same commodity derivative is traded in significant volumes on trading venues in more than one jurisdiction, the competent authority of the trading venue where the largest volume of trading takes place shall be known as the central competent authority and where the Bank becomes the central competent authority in accordance with Article 57(6) of the Directive it shall set the single position limit to be applied on all trading in that contract.

• (12) Where the Bank becomes the central competent authority it shall consult the competent authorities of other trading venues on which that derivative is traded in significant volumes on the single position limit to be applied and any revisions to that single position limit.

• (13) Where the Bank does not agree with the opinion of any competent authorities it consults with or is consulted by under paragraph (12), it shall state in writing the full and detailed reasons why it considers that the requirements laid down in paragraph (3) are not met.

• (14) Where the same commodity derivative is traded in the State and in another Member State or Member States, the Bank shall put in place cooperation arrangements including the exchange of relevant data with the relevant competent authorities in order to enable the monitoring and enforcement of the single position limit.

• (15) An investment firm or a market operator operating a trading venue which trades commodity derivatives shall apply position management controls.

• (16) Position management controls shall permit the trading venue to—

• (a) monitor the open interest positions of persons,

• (b) access information, including all relevant documentation, from persons about the size and purpose of a position or exposure entered into, information about beneficial or underlying owners, any concert arrangements, and any related assets or liabilities in the underlying market,

• (c) require a person to terminate or reduce a position, on a temporary or permanent basis as the specific case may require and to unilaterally take appropriate action to ensure the termination or reduction if the person does not comply, and

• (d) where appropriate, require a person to provide liquidity back into the market at an agreed price and volume on a temporary basis with the express intent of mitigating the effects of a large or dominant position.

• (17) The position limits and position management controls shall be transparent and non-discriminatory, specifying how they apply to persons and taking account of the nature and composition of market participants and of the use they make of the contracts submitted to trading.

• (18) The investment firm or market operator operating the trading venue shall inform the Bank of the details of position management controls.

• (19) The Bank shall communicate the same information as well as the details of the position limits it has established to ESMA.

• (20) The Bank shall not impose limits which are more restrictive than those adopted pursuant to paragraph (1) except in exceptional cases where they are—

• (a) objectively justified, and

• (b) proportionate,

taking into account the liquidity of the specific market and the orderly functioning of that market.

• (21) Where the Bank has decided to impose more restrictive position limits, it shall publish on its website the details of the more restrictive position limits it has decided to impose, which—

• (a) shall be valid for an initial period not exceeding six months from the date of their publication on the website, and

• (b) may be renewed for further periods not exceeding six months at a time if the grounds for the restriction continue to be applicable,

but if they are not renewed after that six-month period, they shall automatically expire.

• (22) Where the Bank decides to impose more restrictive position limits in accordance with paragraph (20), it shall notify ESMA and the notification shall include a justification for the more restrictive position limits.

• (23) Where the Bank imposes limits contrary to an ESMA opinion given in response to a notification under paragraph (22), it shall immediately publish on its website a notice fully explaining its reasons for doing so.

• (24) The Bank may impose position limits in respect of—

• (a) positions held by persons situated or operating in the State or abroad which exceed the limits on commodity derivative contracts which the Bank has set in relation to contracts on trading venues situated or operating in the State or economically equivalent OTC contracts, and

• (b) positions held by persons situated or operating in the State which exceed the limits on commodity derivative contracts set by competent authorities in other Member States.

Position reporting by categories of position holders

• (a) make public a weekly report with the aggregate positions held by the different categories of persons for the different commodity derivatives or emission allowances or derivatives of emission allowances traded on its trading venue, specifying—

• (i) the number of long and short positions by such categories,

• (ii) changes to them since the previous report,

• (iii) the percentage of the total open interest represented by each category, and

• (iv) the number of persons holding a position in each category in accordance with paragraph (5),

and communicate that report to the Bank and to ESMA, and

• (b) provide the Bank with a complete breakdown of the positions held by all persons, including the members or participants and their clients, on that trading venue, on a daily basis.

• (2) The obligation under paragraph (1)(a) only applies where the number of persons and their open positions exceed minimum thresholds.

• (3) Where an investment firm trades in commodity derivatives or emission allowances or derivatives of emission allowances outside a trading venue, it shall at least daily provide to—

• (a) the Bank, and

• (b) where the commodity derivatives or emission allowances (or derivatives of emission allowances) are traded in significant volumes on trading venues in more than one jurisdiction at least on a daily basis, the central competent authority,

a complete breakdown of their positions taken in commodity derivatives or emission allowances (or derivatives of emission allowances) traded on a trading venue and economically equivalent OTC contracts, as well as of those of other clients and the clients of those clients until the end client is reached, in accordance with Article 26 of Regulation (EU) No 600/2014 and, where applicable, Article 8 of Regulation (EU) No 1227/2011.

• (4) In order to enable the monitoring of compliance with Regulation 81(1), the Bank shall require members or participants of regulated markets, MTFs and clients of OTFs to report on a daily basis to the investment firm or market operator operating the trading venue the details of their own positions held through contracts traded on the trading venue, as well as those of their clients and the clients of those clients until the end client is reached.

• (5) Persons holding positions in a commodity derivative or emission allowance (or derivative of an emission allowance) shall be classified by the investment firm or market operator operating that trading venue according to the nature of their main business, taking account of any applicable authorisation, as either—

• (a) investment firms or credit institutions,

• (b) investment funds, (whether an undertaking for collective investments in transferable securities as defined in Directive 2009/65/EC or an alternative investment fund manager as defined in Directive 2011/61/EC),

• (c) other financial institutions, including insurance undertakings and reinsurance undertakings as defined in Directive 2009/138/EC and institutions for occupational retirement provision as defined in Directive 2003/41/EC,

• (d) commercial undertakings, or

• (e) in the case of emission allowances (or derivatives of emission allowances), operators with compliance obligations under Directive 2003/87/EC.

• (6) The report referred to in paragraph (1)(a) and the breakdown referred to in paragraph (3) shall differentiate between—

• (a) positions identified as positions which in an objectively measureable way reduce risks directly relating to commercial activities, and

• (b) other positions.

PART 9 DATA REPORTING SERVICES

Requirement for authorisation

• (2) The Bank shall allow an investment firm or a market operator operating a trading venue to operate the data reporting services of an APA, a CTP and an ARM in the State, subject to the prior verification of their compliance with this Part and the service being included in their authorisation.

• (3) The Bank shall—

• (a) establish and maintain a register of all authorised data reporting services providers,

• (b) ensure that the register is publicly accessible and contains information on the services for which the data reporting services providers are authorised, and

• (c) notify ESMA of all authorised data reporting services providers.

• (4) Data reporting services providers shall provide their services under the supervision of the Bank and the Bank shall regularly review their compliance with this Part.

• (5) The Bank shall monitor that data reporting services providers comply at all times with the conditions for authorisation.

• (6) An application for authorisation may be granted—

• (a) unconditionally, or

• (b) subject to such conditions or requirements as the Bank sees fit.

• (7) The Bank may from time to time vary conditions or requirements subsequent to granting an application for authorisation.

Scope of authorisation

• (2) A data reporting services provider seeking to extend its business to additional data reporting services shall submit a request to the Bank for extension of its authorisation.

• (3) An authorisation granted to a data reporting services provider—

• (a) is valid for the entire European Union, and

• (b) allows a data reporting services provider to provide the services, for which the data reporting services provider has been authorised, throughout the European Union.

Procedures for granting and refusing requests for authorisation

• (a) may grant or refuse to grant to any person applying to it under this Regulation an authorisation to operate as a data reporting services provider, and

• (b) shall not grant an authorisation unless satisfied that the applicant complies with all requirements under these Regulations.

• (2) The Bank shall refuse authorisation if—

• (a) it is not satisfied that the person or persons who shall effectively direct the business of the data reporting services provider are of good repute, or

• (b) there are objective and demonstrable grounds for believing that the management body of the data reporting services provider may pose a threat to its sound and prudent management and to the adequate consideration of its clients and the integrity of the market.

• (3) A data reporting services provider shall provide all information, including a programme of operations setting out—

• (a) the types of services envisaged, and

• (b) the organisational structure,

necessary to enable the Bank to satisfy itself that the data reporting services provider has established, at the time of initial authorisation, all the necessary arrangements to meet its obligations under the provisions of this Part.

• (4) The Bank shall inform the applicant, within six months of the submission of a complete application, whether or not authorisation has been granted.

Withdrawal of authorisation of data reporting services provider

• (a) fails to provide data reporting services during the 12 month period after the date of the authorisation,

• (b) expressly renounces the authorisation,

• (c) obtained the authorisation by making false statements or by any other irregular means,

• (d) no longer meets the conditions under which the authorisation was granted, or

• (e) has seriously and systematically contravened the provisions of these Regulations or of Regulation No. 600/2014.

• (2) Other than in the circumstances outlined in paragraph (1)(a), the Bank may withdraw an authorisation granted under Regulation 85 to operate as a data reporting services provider to an investment firm if the investment firm has not provided data reporting services for the immediately preceding 6 months.

Requirements for management body of data reporting services provider

• (a) are of good repute,

• (b) possess sufficient knowledge, skills and experience, and

• (c) commit sufficient time to perform their duties.

• (2) A data reporting services provider shall ensure that the members of its management body possess adequate collective knowledge, skills and experience to be able to understand the activities of the data reporting services provider.

• (3) A data reporting services provider shall ensure that each member of its management body acts with honesty, integrity and independence of mind to effectively challenge the decisions of the senior management where necessary and to effectively oversee and monitor decision-making where necessary.

• (4) Where a market operator seeks authorisation to operate an APA, a CTP or an ARM and the members of the management body of the APA, the CTP or the ARM are the same as the members of the management body of the regulated market, those persons are deemed to comply with the requirement set out in paragraph (1).

• (5) A data reporting services provider shall notify the Bank of all members of its management body and of any changes to its membership, together with all information needed to assess whether the firm complies with paragraphs (1) to (4).

• (6) A data reporting services provider shall ensure that its management body defines and oversees the implementation of the governance arrangements that ensure effective and prudent management of the organisation, including the segregation of duties in the organisation and the prevention of conflicts of interest, in a manner that promotes the integrity of the market and the interest of its clients.

• (7) The Bank shall, as soon as may be after the withdrawal, notify ESMA of each authorisation it has withdrawn in accordance with Regulation 86.

PART 10 CONDITIONS FOR APAs, CTPs and ARMs

Organisational requirements for APAs

• (2) The information required under paragraph (1) shall be—

• (a) made available free of charge 15 minutes after the APA has published it, and

• (b) disseminated efficiently and consistently in a way that ensures fast access to the information—

• (i) on a non-discriminatory basis, and

• (ii) in a format that facilitates the consolidation of the information with similar data from other sources.

• (3) The information made public by an APA in accordance with paragraphs (1) and (2) shall include at least—

• (a) the identifier of the financial instrument,

• (b) the price at which the transaction was concluded,

• (c) the volume of the transaction,

• (d) the time of the transaction,

• (e) the time the transaction was reported,

• (f) the price notation of the transaction,

• (g) the code for the trading venue the transaction was executed on or, where the transaction was executed via a systematic internaliser, the code “SI”, or otherwise the code “OTC”, and

• (h) if applicable, an indicator that the transaction was subject to specific conditions.

• (4) An APA shall operate and maintain effective administrative arrangements designed to prevent conflicts of interest with its clients and, in particular, an APA who is also a market operator or investment firm shall treat all information collected in a non-discriminatory fashion and shall operate and maintain appropriate arrangements to separate different business functions.

• (5) An APA shall have sound security mechanisms in place designed to—

• (a) guarantee the security of the means of transfer of information,

• (b) minimise the risk of data corruption and unauthorised access, and

• (c) prevent information leakage before publication.

• (6) An APA shall maintain adequate resources and have back-up facilities in place in order to offer and maintain its services at all times.

• (7) An APA shall have systems in place that can—

• (a) effectively check trade reports for completeness,

• (b) identify omissions and obvious errors, and

• (c) request re-transmission of any such erroneous reports.

Organisational requirements for CTPs

• (a) collect the information made public in accordance with Articles 6 and 20 of Regulation (EU) No 600/2014,

• (b) consolidate it into a continuous electronic data stream, and

• (c) make the information available to the public as close to real time as is technically possible, on a reasonable commercial basis.

• (2) The information required under paragraph (1) shall be—

• (a) made available free of charge 15 minutes after the CTP has published it, and

• (b) disseminated efficiently and consistently in a way that ensures fast access to the information—

• (i) on a non-discriminatory basis, and

• (ii) in formats that are easily accessible and utilisable for market participants.

• (3) The information required under paragraph (1) shall include—

• (a) the identifier of the financial instrument,

• (b) the price at which the transaction was concluded,

• (c) the volume of the transaction,

• (d) the time of the transaction,

• (e) the time the transaction was reported,

• (f) the price notation of the transaction,

• (g) the code for the trading venue the transaction was executed on, or where the transaction was executed via a systematic internaliser the code “SI” or otherwise the code “OTC”,

• (h) the fact that a computer algorithm within the investment firm was responsible for the investment decision and the execution of the transaction, where applicable,

• (i) an indicator that the transaction was subject to specific conditions, if applicable, and

• (j) if the obligation to make public the information referred to in Article 3(1) of Regulation (EU) No 600/2014 was waived in accordance with point (a) or (b) of Article 4(1) of that Regulation, a flag to indicate which of those waivers the transaction was subject to.

• (4) A CTP shall have adequate policies and arrangements in place to—

• (a) collect the information made public in accordance with Articles 10 and 21 of Regulation (EU) No 600/2014,

• (b) consolidate it into a continuous electronic data stream, and

• (c) make the information available to the public as close to real time as is technically possible, on a reasonable commercial basis.

• (5) The information required under paragraph (4) shall be—

• (a) made available free of charge 15 minutes after the CTP has published it, and

• (b) disseminated efficiently and consistently in a way that ensures fast access to the information—

• (i) on a non-discriminatory basis, and

• (ii) in generally accepted formats that are interoperable, easily accessible and utilisable for market participants.

• (6) The information required under paragraph (4) shall include—

• (a) the identifier or identifying features of the financial instrument,

• (b) the price at which the transaction was concluded,

• (c) the volume of the transaction,

• (d) the time of the transaction,

• (e) the time the transaction was reported,

• (f) the price notation of the transaction,

• (g) the code for the trading venue the transaction was executed on or, where the transaction was executed via a systematic internaliser, the code “SI” or otherwise the code “OTC”, and

• (h) an indicator that the transaction was subject to specific conditions, if applicable.

• (7) The CTP shall ensure that the data provided is consolidated from all the regulated markets, MTFs, OTFs and APAs and for the financial instruments specified by regulatory technical standards under Article 65(8)(c) of the Directive.

• (8) A CTP shall operate and maintain effective administrative arrangements designed to prevent conflicts of interest and, in particular, a market operator or an APA who also operates a consolidated tape shall treat all information collected in a non-discriminatory fashion and shall operate and maintain appropriate arrangements to separate different business functions.

• (9) A CTP shall have sound security mechanisms in place designed to—

• (a) guarantee the security of the means of transfer of information, and

• (b) minimise the risk of data corruption and unauthorised access.

• (10) A CTP shall maintain adequate resources and have back-up facilities in place in order to offer and maintain its services at all times.

Organisational requirements of ARMs

• (2) The information required under paragraph (1) shall be reported in accordance with the requirements laid down in Article 26 of Regulation (EU) No 600/2014.

• (3) An ARM shall operate and maintain effective administrative arrangements designed to prevent conflicts of interest with its clients and, in particular, an ARM which is also a market operator or investment firm shall treat all information collected in a non-discriminatory fashion and shall operate and maintain appropriate arrangements to separate different business functions.

• (4) An ARM shall have sound security mechanisms in place designed to—

• (a) guarantee the security and authentication of the means of transfer of information,

• (b) minimise the risk of data corruption and unauthorised access,

• (c) prevent information leakage, and

• (d) maintain the confidentiality of the data at all times.

• (5) An ARM shall maintain adequate resources and have back-up facilities in place in order to offer and maintain its services at all times.

• (6) An ARM shall have systems in place to—

• (a) effectively check transaction reports for completeness,

• (b) identify and communicate details of omissions and obvious errors caused by the investment firm,

• (c) request re-transmission of any such erroneous reports,

• (d) detect and correct, errors or omissions caused by the ARM itself, and

• (e) enable the ARM to transmit or retransmit correct and complete transaction report to the Bank.

PART 11 THE BANK AS COMPETENT AUTHORITY

Chapter 1 Designation, powers and redress procedures

Bank to be competent authority

• (2) The Bank shall inform ESMA and the competent authorities of other Member States of that fact.

Supervisory powers of Bank as competent authority

• (2) The powers provided for in this Part in respect of the Bank shall not be exercised in a manner or for a purpose inconsistent with the Bank’s obligations under Regulation (EU) No 600/2014 or these Regulations.

• (3) The powers of the Bank shall include the power to require the following persons to provide all information that is necessary in order to enable the Bank to carry out its tasks under these Regulations and Regulation (EU) No 600/2014 including information to be provided at recurring intervals and in specified formats for supervisory and related statistical purposes:

• (a) investment firms and credit institutions established in the State;

• (b) market operators established in the State;

• (c) data reporting service providers established in the State;

• (d) entities performing investment services or activities through the establishment of a branch within the State;

• (e) staff of the entities referred to in subparagraphs (a) to (d);

• (f) third parties to whom the entities referred to in subparagraphs (a) to (d) have outsourced operational functions or activities.

• (4) In addition to the foregoing powers of the Bank, the Bank may—

• (a) request any person to permit the Bank to inspect or have access to any document or other data, in any form, in the possession, or under the power or control, of the person, being any document or other data which the Bank considers could be relevant for the performance of its duties and may receive or take a copy of any such document or other data accordingly,

• (b) require any person to provide information to it, being any document or other data which the Bank considers could be relevant for the performance of its duties, and if necessary to summon and question a person with a view to obtaining information,

• (c) carry out on-site inspections or investigations,

• (d) require an investment firm, a credit institution, or any other entity regulated by these Regulations or by Regulation (EU) No 600/2014 to furnish to it existing recordings of telephone conversations or electronic communications or other data traffic records held by the investment firm, a credit institution, or any other entity,

• (e) require, in accordance with the Central Bank Acts 1942 to 2015, the freezing or the sequestration of assets, or both,

• (f) require any person carrying on a professional activity and to whom these Regulations apply to cease, for a specified period, the carrying on of an activity,

• (g) require the auditors of an investment firm, a regulated market or data reporting services provider to provide information to it,

• (h) as provided for under Regulation 119, bring and prosecute summary proceedings for an offence under these Regulations,

• (i) engage auditors or experts to carry out verifications or investigations,

• (j) require any person to provide to it information including all relevant documentation regarding the size and purpose of a position or exposure entered into by the person via a commodity derivative, and any assets or liabilities in the underlying market,

• (k) require, in accordance with the Central Bank Acts 1942 to 2015, the temporary or permanent cessation of any practice or conduct that the Bank considers to be in contravention of a provision of these Regulations or Regulation (EU) No 600/2014 and prevent, in accordance with those Acts, the repetition of that practice or conduct,

• (l) adopt any type of measure so as to ensure that investment firms, regulated markets and other persons to whom these Regulations or Regulation (EU) No 600/2014 applies continue to comply with the requirements of these Regulations or Regulation (EU) No 600/2014 (or both as the case may be),

• (m) require a regulated market to suspend the trading in a financial instrument on the market,

• (n) require the removal, by the regulated market concerned or, as the case may be, the person providing the trading arrangements concerned, of a financial instrument from trading, whether on a regulated market or under other trading arrangements,

• (o) require any person to take steps to reduce the size of the position or exposure held by the person,

• (p) impose restrictions on the ability of any person to enter into a commodity derivative, including by imposing limits on the size of a position any person can hold at all times in accordance with Regulation 81,

• (q) issue public notices,

• (r) suspend, by issuing any necessary directions in that behalf, the marketing or sale of financial instruments or structured deposits where the conditions of Article 40, 41 or 42 of Regulation (EU) No 600/2014 are met,

• (s) suspend, by issuing any necessary directions in that behalf, the marketing or sale of financial instruments or structured deposits where the investment firm has not developed or applied an effective product approval process or otherwise failed to comply with Regulation 23(1)(b) to (e), and

• (t) require an investment firm or market operator to remove from the management board of the investment firm or market operator a particular person.

• (5) Where not specifically provided for in paragraph (4), an obligation to produce a relevant record or report, or to provide information or assistance, under that paragraph extends to—

• (a) an examiner, liquidator or receiver of, or any person who is or has been an officer or employee or agent of, a person to whom these Regulations apply, or

• (b) any other person who appears to the Bank to have the relevant record or report in his or her possession or under his or her control or the ability to provide information or assistance, as the case may be.

• (6) A person who,without reasonable excuse, fails to comply with a request made by a member of the Garda Síochána under section 6 (1) of the Communications (Retention of Data) Act 2011 (No. 3 of 2011) for the purposes of the prevention, detection, investigation or prosecution of an offence under these Regulations shall be guilty of an offence and shall be liable on summary conviction, to a class A fine or imprisonment for a term not exceeding 12 months or both.

• (7) Where a person from whom production of a relevant record is required under this Regulation claims a lien over it, its production does not affect the lien.

Delegations, etc

• (a) directly,

• (b) by delegation in accordance with paragraph (2), or

• (c) by delegation in accordance with Regulation 37(9).

• (2) The Bank may delegate in writing to such other authorities any one or more of its functions under these Regulations or Regulation (EU) No 600/2014 as it considers appropriate having taken all reasonable steps to ensure that the authority to which tasks are to be delegated has—

• (a) the capacity and resources to effectively execute all tasks, and

• (b) that the delegation takes place only if a clearly defined and documented framework for the exercise of any delegated tasks has been established stating the tasks to be undertaken and the conditions under which they are to be carried out, which shall include a clause obliging the entity in question to act and be organised in such a manner as to avoid conflict of interest and so that information obtained from carrying out the delegated tasks is not used unfairly or to prevent competition.

• (3) A delegation under this Regulation shall not prevent the performance by the Bank of the function delegated.

• (4) Notwithstanding any delegation under this Regulation, the final responsibility for supervising compliance with these Regulations or Regulation (EU) No 600/2014 shall be with the Bank.

Chapter 2

Appointment of Authorised Officers, Appointment of Inspectors, their powers and related matters

Power to appoint authorised officers

• (2) The Bank may, at any time in writing, revoke the appointment of a person to be an authorised officer under this Regulation.

• (3) Subject to paragraph (2), the appointment of an authorised officer under this Regulation may be for a specified, or an unspecified, period or for a specified purpose.

• (4) The Bank shall provide every authorised officer with a certificate of his or her appointment as an authorised officer.

• (5) When exercising a power conferred on an authorised officer under this Part, an authorised officer shall produce his or her certificate of appointment, together with some form of personal identification, if requested to do so by a person affected by the exercise of the power.

• (6) The appointment of an authorised officer made under this Regulation ceases—

• (a) if the Bank revokes the appointment, at the time of revocation,

• (b) if the person appointed dies, at the time of death,

• (c) if the person resigns, at the time of resignation,

• (d) if the appointment is for a specified period, at the end of that period,

• (e) if the appointment is for a specified purpose, on the completion of that purpose, or

• (f) if the person appointed is, when appointed, an officer of the Bank, when the person ceases to be such an officer.

Function of authorised officers and their powers in that regard

• (2) For the purpose of paragraph (1), an authorised officer shall, subject to paragraph (3), have each of the powers that are conferred on the Bank by Regulation 92(4).

• (3) So far as a provision of Regulation 92(4) provides that a power thereunder is exercisable in accordance with the Central Bank Acts 1942 to 2015, then paragraph (2) shall be construed and have effect, in relation to the particular power concerned, as only enabling an authorised officer to advise the Bank that particular circumstances have arisen that warrant, in the officer’s opinion, the exercise of the power by the Bank and not as enabling the authorised officer to exercise the power himself or herself.

• (4) Regulation 92(5) and (7) shall apply for the purpose of this Regulation as they apply for the purpose of Regulation 92.

• (5) When exercising a power under this Part, an authorised officer may, where the officer considers it necessary, be accompanied by one or more—

• (a) members of the Garda Síochána, or

• (b) other authorised officers.

Search warrant

• (2) Where an authorised officer in the exercise of the authorised officer’s powers under Regulation 95 is prevented from entering any place, whether or not a private dwelling, where he or she believes that there are relevant records, the authorised officer may apply to a judge of the District Court for a warrant under this Regulation authorising the entry by the authorised officer into the place.

• (3) Without prejudice to the powers conferred on an authorised officer by or under any provision of these Regulations, an authorised officer may, for the purposes of an investigation into an offence under these Regulations, apply to a judge of the District Court for a warrant in relation to any place.

• (4) Where, on the hearing of an application under paragraph (2) or (3), a judge of the District Court is satisfied on sworn information of the authorised officer that he or she—

• (a) has been prevented from entering any place that is not a private dwelling,

• (b) has reasonable grounds for believing that relevant records are kept at a place that comprises, or forms part of, a private dwelling, or

• (c) has reasonable grounds for suspecting that evidence of, or relating to, the commission of an offence under these Regulations or Regulation (EU) No 600/2014 is to be found in any place,

that judge may issue a warrant under his or her hand authorising one or more authorised officers accompanied, if the judge considers it appropriate to so provide, by such number of members of the Garda Síochána as may be specified in the warrant, at any time within 4 weeks after the date of issue of the warrant, to enter, if necessary by force, the place or private dwelling and exercise any of the powers referred to in Regulation 95.

Appointment of inspector by Court

• (a) the proper and orderly regulation and supervision of investment firms or regulated markets or data reporting service providers, or

• (b) the protection of investors,

that an investigation should be held into the affairs of an investment firm, the market operator of a regulated market or a data reporting service provider, the Bank may apply to the Court for an order authorising such an investigation.

• (2) On application by the Bank under paragraph (1), the Court, as it thinks proper may appoint one or more inspectors to—

• (a) investigate the affairs of—

• (i) the investment firm, market operator or data reporting service provider that is the subject of the application, and

• (ii) where necessary, any subsidiary or other associated or related undertaking of the investment firm, market operator or data reporting service provider, and

• (b) report the results of the investigation in such manner as the Court directs.

• (3) Before applying to the Court to appoint an inspector under this Regulation, the Bank, if it is of the opinion that it would not be prejudicial to the interests of shareholders or creditors or investors, may notify the investment firm, the market operator or data reporting service provider concerned in writing of—

• (a) the application, and

• (b) reasons for the application,

and, in that case, the investment firm, the market operator or data reporting service provider, within such period as the Bank may set out in the notification, shall be entitled to give to the Bank a statement in writing explaining the relevant activities of the investment firm, market operator or data reporting service provider, as the case may be.

Power of inspector to extend investigation

• (a) any other investment firm, market operator, or data reporting service provider, or

• (b) any body corporate or any undertaking which body or undertaking is or was at any relevant time a subsidiary, an associated undertaking or a related undertaking of the investment firm, the market operator or data reporting service provider,

the inspector, with the approval of the Court, shall have power to do so, and shall report on the affairs of—

• (i) the other investment firm or regulated market, or

• (ii) the body corporate, undertaking, associated undertaking or related undertaking,

so far as the inspector thinks the results of the investigation are relevant to the investigation of the affairs of the first-mentioned investment firm, market operator or data reporting service provider.

Direction to inspector by Court

Powers of inspection

• (a) of all officers, shareholders, employees and agents of an investment firm or regulated market or other body the affairs of which are being investigated as provided by Regulation 97 or 104, including officers, shareholders and agents outside the State, and

• (b) of any other person, including those being investigated under Regulation 98, and including any person outside the State, who the inspector considers is, or may be, in possession of any information concerning the affairs of an investment firm, regulated market or data reporting service provider,

to do each of the following:

• (i) produce to an inspector appointed under Regulation 97 or 104, all books, accounts, deeds, records or other documents of, or relating to the business of the investment firm, the market operator, or the data reporting service provider or the person being investigated under Regulation 98, which are in their control, possession or procurement;

• (ii) attend before the inspector, when required to do so;

• (iii) give to the inspector all assistance in connection with the investigation which they are reasonably able to give.