MiFID II and MiFIR order flagging requirements – Reminder

Release date: 09 Sep 2019

065/2019 MiFID II and MiFIR order flagging requirements – ReminderXetra Circular 065/19

1. Introduction

This circular is to remind you of the obligation of all Trading Participants to provide the data required in accordance with Directive 2014/65 EU and Regulation 600/2014, as already explained in Xetra circular 052/19. 

Please note that violations of this obligation may be punished by the Sanctions Committee of Frankfurter Wertpapierbörse (FWB®, the Frankfurt Stock Exchange).

2.  Legal basis

Since 3 January 2018, all Trading Participants have been required to identify the algorithm they are using in connection with their participation in exchange trading, the execution decision maker, the investment decision maker and the client (Article 48(10) of Directive 2014/65 EU and Article 25(2)(3) of Regulation 600/2014). These legal requirements were incorporated in the Exchange Rules of Frankfurter Wertpapierbörse (FWB®) (§§ 40, 74 and 114 Exchange Rules FWB®). We would like to point out that violations against these reporting requirements will in future be handed to the Sanctions Committee.

Please find all flagging options and scenarios in the document “MiFID II/MiFIR flagging requirements” on the Xetra website www.xetra.com under the following link:

The fields “execution decision”, “investment decision” and “clientID” in the orders are to be filled using the “short code” solution. Please note that algorithms do not need to be encrypted using short codes due to their numerical format. Only natural persons and Legal Entity Identifiers (LEIs) need encryption using the short code solution. The investment decision and execution decision identifiers are to be set to either “Algorithm” or “Natural person”.

Trading Participants are obliged to upload the corresponding explanatory long codes to their short codes in the FWB® upload functionalities (SFTP or Member Section) prior to but not later than the next trading day (T+1). Algorithm certificates need to be provided to FWB® prior to the usage of algorithms via the FWB® upload functionalities (SFTP or Member Section). For further details, please refer to the “Reporting Handbook” on the Xetra website under the link stated above.

Links to the documents:

Attachments: 

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Recipients:All Xetra® Members and Vendors
Target groups:Compliance departments, Nominated Persons
Contact:For functional questions: client.services@deutsche-boerse.com or sales.cashmarket@deutsche-boerse.com, for compliance-related questions: regulatory.processing@deutsche-boerse.com
Related Xetra circular:052/19
Web:www.xetra.com
Authorized by:Cord Gebhardt, Annette Czypull