News 09/09/24

Registration as Designated Publishing Entity open for investment firms

Investment firms can register as a Designated Publishing Entity (DPE) with the Dutch Authority for the Financial Markets (AFM) as of 9 September 2024. The Markets in Financial Instruments Regulation (MiFIR) review introduced provisions allowing investment firms to be granted the new DPE status. When two parties trade in financial instruments off exchange, one of the parties is required to make information on the transaction public through an Approved Publication Arrangement (APA). The investment firm that is registered as a DPE is responsible for making the transaction public.

Registration under DPE regime partially replaces registration under SI regime

Under the previous regime, investment firms that met the definition of a Systematic Internaliser (SI) were required to make information on transactions public through an Approved Publication Arrangement (APA). Many investment firms that did not deal on their own account on a systematic basis voluntarily opted-in under the SI regime to enable them to make public the transactions they carried out for their clients. The new status of Designated Publishing Entity was created as a result of the disproportionate obligations this imposed on them. Once registered as a DPE, an investment firm can take responsibility for making transactions public through an APA, without opting for the status of SI.

Registration with AFM for inclusion in ESMA register

Investment firms with a licence from the AFM can register as a DPE with the AFM. The AFM will then transmit the information regarding the registration to ESMA, the European Securities and Markets Authority. ESMA will include the registration in the future DPE register. This register will be published online and is expected to be available through the ESMA website from 29 September 2024.

Transition to new regime

The new status of DPE is part of the Markets in Financial Instruments Regulation (MiFIR) review. This review focused, among other things, on changes that promote transparency and the availability of market data.

The transition to the DPE regime will be carried out in two steps. First, ESMA starts publishing the DPE register on its website on 29 September 2024. Second, the new DPE regime for post-trade transparency becomes fully operational on 3 February 2025. From this date, registered DPEs involved in a transaction are required to make information on the transaction public through an Approved Publication Arrangement (APA). It should be noted that the SI regime will remain in place after this date, although in modified form.