Further to ESMA’s statement of 31 March 2020 (ESMA35-36-1919) in connection with the COVID-19 epidemic, ESMA expects national supervision authorities to allow the postponement of publication dates, by which the entities are obligated to publish their execution reports as required under the following acts delegated to MiFID II:

• RTS 27, under which execution venues are required to publish data relating to the quality of execution of transactions on that venue on the quarterly basis, which shall include in particular details about price, costs, speed and likelihood of execution for individual financial instrument (the next date in respect of this obligation is 31 March 2020),
• RTS 28, under which the investment firms, as defined in MiFID II, are required to publish annual reports prepared for each class of financial instruments disclosing the top five execution venues in terms of trading volumes where they executed client orders in the preceding year and quality of execution obtained (the next date in respect of this obligation is 30 April 2020),

In support of ESMA’s statement, UKNF (the Polish Financial Supervision Authority) published a communication on 31 March 2020, stating that:

• Execution venues (i.e. the regulated markets, systematic internalizers, market makers and other liquidity providers within the meaning of MiFID II), unable to publish quarterly reports in accordance with RTS 27 by 31 March 2020, shall publish them as soon as possible, but not later than by 30 June 2020,
• Investment firms, banks and other entities providing services regulated in the Act on Trading in Financial Instruments (including execution of orders, reception and transmission of orders in relation to one or more financial instruments and portfolio management), required to publish the reports as referred to in RTS 28 by 30 April 2020, shall publish the said reports by the deadline or by 30 June 2020 at the latest.

Following ESMA’s recommendation, UKNF states that entities required to publish the reports should maintain a register of internal decisions taken in connection with the predicted delays.

At the same time, ESMA emphasizes in its statement that any possible delay in the reporting does not limit the obligation of the entities to achieve best execution for their clients, and ensure fair order handling and allocations during the current market volatility.

Source:

1. ESMA
2. KNF