On December 15, 2017, the European Securities and Markets Authority (ESMA) revised two opinions providing guidance to investment firms on their post-trade transparency (Transparency Opinion) and position limits (Limits Opinion) obligations under the revised Markets in Financial Instruments Directive (MiFID II) and the Markets in Financial Instruments Regulation (MiFIR) when they transact on third-country trading venues.

The Opinions were initially published on May 31, 2017 (for further information on the Transparency Opinion, please see the Corporate & Financial Weekly Digest of June 2, 2017). The previous version of the Transparency Opinion specified that, subject to third-country trading venues meeting a set of criteria, investment firms trading on those trading venues would not be required to make transactions public in the EU. Equally, under the Limits Opinion, commodity derivatives contracts traded on qualifying third-country trading venues would not be considered economically equivalent over-the-counter (EEOTC) contracts for the purposes of the position limit regime. The original Opinions required ESMA to establish a list of such third-country trading venues benefitting from the relief.

The revised Opinions state that, pending an assessment by ESMA of more than 200 third-country trading venues under the criteria in the Opinions, transactions on third-country trading venues are not subject to post-trade transparency requirements nor will positions in commodity derivatives traded on those third-country venues be treated as potentially EEOTC contracts. ESMA has stated that it will carry out the determination of third-country trading venues and publish the results in the course of 2018.

The Transparency Opinion is available here and the Limits Opinion is available here.