The main requirements of MiFID II become effective in January 2018. This includes many of the regulatory technical standards (RTS). RTS 6 addresses algorithmic trading and direct electronic access (DEA).
All investment firms engaging in algorithmic trading, providing direct electronic access (DEA), or acting as general clearing members must meet the requirements specified by RTS 6 under Article 17(7)(a) of MiFID II.
Object Trading reviewed RTS 6 and identified the articles that specifically impact direct market access (DMA). We prepared a guide to summarize all of the RTS 6 articles related to DMA. The guide includes a table that summarizes the relevant articles, and explains how our DMA Platform helps clients meet or facilitates their ability meet their obligations for each of the specified requirements.
Investment Firms engaging in algorithmic trading, firms providing DEA, and firms acting as general clearing members are required to comply with RTS 6. Hence, it affects both the buy-side and the sell-side for any firm wishing to trade in markets located in the EU (regardless of where the trading firm is domiciled).
Why is this important?
RTS 6 specifies the systems, procedures, arrangements and controls to be put in place and maintained by investment firms engaged in DEA and/or algorithmic trading, to address the increasing risks of electronic access to trading venues. Investment firms must comply with the organisational requirements of the regulation in order to trade in the EU markets.
What’s Object Trading doing about it?
Our Direct Market Access Platform provides many of the capabilities required by RTS 6, and facilitates firms’ ability to meet requirements. It also provides information needed for firms to meet other compliance obligations outside the system.
Once a firm is on our DMA Platform, they can also access 60+ global exchanges from the same normalised interface.
Object Trading Compliance Guide – RTS 6
We have created a guide that lists each article of RTS 6 that is relevant to DMA. The Guide provides a table that explains for each relevant article how our DMA Platform helps clients fully meet, facilitates meeting, or facilitates 3rd party solutions to help clients fulfill their obligations for each of the specified requirements. In all cases, the investment firm remains fully responsible for its obligations; the guide identifies specific features of our platform that help clients meet those obligations.
You can learn more and access the Compliance Guide for RTS 6 by clicking here.
Object Trading Regulatory and Exchange Update Resource Centre
Object Trading has developed a resource centre that shares our approach to helping clients address both the onerous requirements of new regulations such as MiFID II, and relentless exchange changes. The RTS 6 Compliance Guide is one of many assets we’ll make available.
We’ll add content to the portal regularly as new information becomes available from regulators, industry associations, and exchanges. You will receive notifications when there is new content available.
While some of the information will be made publicly available, such as the RTS 6 Compliance Quick Guide, other assets will be accessible only with explicit approval. You can request access to the RTS 6 Compliance Complete Guide by clicking here and completing the registration form. Note, approvals for access to the Complete Guide are at Object Trading’s discretion, and are limited to buy-side and sell-side firms, technology partners, and current customers.
What else do I need to know?
The global markets landscape is constantly shifting with a steady stream of regulatory updates and exchange upgrades, migrations, and product launches. All of the European exchanges are working hard to prepare for MiFID II. Our team is continually evolving the Object Trading DMA Platform to accommodate exchange upgrades and updates as they occur. For the past few months, we’ve been publishing guidance on what’s happening at various exchanges.
The resource centre also displays a graphical timeline and descriptions of all the planned updates for 2017. We update the timeline on a regular basis as new dates are announced. So check back frequently or subscribe for updates to get the most recent information.