MiFIR transaction reporting enables NCAs in assessment and investigation of potential incidents involving market abuse of some kind, thereby helping them to analyze. The analytic procedure helps NCAs check out the market for its excellent and proper functioning.
Obligations for Firms
The requirements to report transactions may require the respective firms to build a detailed report of all the executed transactions of the entire business days. The financial instruments should provide all the complete and accurate details for the days. Before the end of every working day, authority checks and reviews the whole day’s financial instruments.
There is a specific Ateam of regulators whose task is to analyze the market for any potential misconduct, criminal activities, and anything related to general market abuse.
MiFID Reporting – What it actually is?
MiFID review was formulated at first to meet the requirements of the teams of the firm that work as regulators. This reporting has not seen any changes over the years.
There are some stipulated requirements for MiFID reporting; financial instruments are submitted during a meeting to NCAs. The report usually provides data of completed traded and work-in-progress sort financial transactions. The report also gives a detailed overview of financial instruments traded on a venue.
Difference between MiFIR Transaction Reporting and MiFID reporting
As stated above in the article, MiFIR is based on a few rules which are followed alongside new directives of MiFID reporting.
The former one has new regulations, whereas the latter one is still used in connection to basic financial reporting.
MiFID introduced the concept of harmonized transaction reporting in 2007, all around Europe, for successful assessment and investigation of potential market abuse. The idea itself expands the scope of existing reporting regulation by adding more rules, and they came into effect in 2019. Now regulators are required to follow these new terms for not only guarding against market abuse but also improving its function and integrity.
The current regulation poses no risk since the reporting driven through the process is usually credible. The financial instruments are reported across new and existing asset classes, thereby improving the analysis procedure and decreasing market corruption. The original MiFIR transaction reporting, when used in connection with MiFIR reporting, reduces all chances of incomplete and inaccurate financial reporting. Now there is another rule which would be implemented soon; it is believed that all the national authorities would increase the fine 50% per breach for their jurisdictions.
