As part of the European Commission’s review of the NIS Directive (Security of Network and Information Systems), Euronext is publishing its position with respect to the future of Cyber Resilience and Supervision in the EU. We believe there is a strong case for further harmonisation with respect to standards and procedures. In our view this will strengthen the overall European cyber resilience. Attached paper sets out the main goals we identified.

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Euronext position on the NIS Review

In today's increasingly fragmented market structure, Euronext shares the view that there is a need for consolidation of market data across European markets. The key challenge facing the industry and legislator is the elaboration of a solution where the costs and benefits – as well as potential policy risks – are appropriately balanced and calibrated. 

Euronext’s policy paper “A Consolidated Tape: Friend or Foe” tackles these issues in a comprehensive fashion, exploring the pros and cons of the respective options. In our view, a consolidated view of market data can be best achieved by the development of an end-of-day consolidated tape, covering 100% of data sources and combining post-trade data with information such as the side (bid or ask) of trades executed on a venue and information on liquidity available at execution. 

Find our detailed position in our policy paper “CMU and the Consolidated Tape: Friend or Foe” which explores the pros and cons of the different tape options.

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CMU and the Consolidated Tape: Friend or Foe

Euronext, through its CSDs Interbolsa, Euronext VPS and VP Securities, welcomes this CSDR Consultation Paper and the opportunity to provide input to the Commission on this topic and share our views and experiences in the implementation of CSDR to date. We welcome the Commission’s goals to simplify CSDR and contribute to the development of a more integrated post-trading landscape in the EU. Although it is still too early to undertake a full review of CSDR, there are certain matters where clarifications would greatly benefit the application and implementation of the regime, notably the passporting framework as laid out in Article 23 and the threshold included in Article 54(5) in relation to the provision of banking-type ancillary services.  

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Response to European Commission CSDR Consultation Paper

Breaking Barriers: Empowering Retail Investors in EU Capital Markets through the Retail Investment Strategy (RIS) proposal

Our white paper highlights the concerning trend of retail investors facing increasing barriers to trading simple bonds, as evidenced by statistics from 2024. Despite the intentions behind frameworks like PRIIPs and MiFID II to protect retail investors and rebuild trust, there has been a notable decline in the accessibility of corporate bonds for retail investors, impacting portfolio diversification. In the framework of discussions around the Retail Investment Strategy proposal we recommend facilitating retail access to straightforward instruments like corporate bonds, proposing exemptions from certain regulatory requirements to achieve this goal. Doing so will help achieve key goals of the proposal, such as increasing retail investors’ participation in EU capital markets.

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White Paper Euronext - Corporate Bonds

The entry into force of MiFID II has led to a decrease in overall equity research coverage on all of our listed companies. In particular, the introduction of new rules on the unbundling of research and execution services have resulted in fewer analysts covering issuers’ stocks, with some companies being left with no analyst at all.

Euronext is engaging with financial market participants and regulators with a view to increasing listed companies’ coverage, thereby providing them with investment opportunities and additional visibility across our markets.

Find below our detailed position and legislative proposals to increase the production of SME research in the EU.

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MIFID Refit - Euronext Position on SME equity research

MiFID II introduced the position limits regime with a view to improve the functioning and transparency of financial and commodity markets. This has provided value to the commodities markets, notably with respect to our benchmark contracts (i.e. Milling Wheat, Rapeseed and Corn).

However, there is merit in amending the existing position limits regime to incentivise the creation, and proper functioning, of new nascent commodity contracts.

This position sets out our views on the Commission’s proposals to alleviate the existing position limits regime in the framework of the MiFID II review.

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MiFID Refit - Euronext Position on the Commodities Markets

The objective of strengthening transparent multilateral markets was at the core of the MiFID II reforms but it is now critical that the current review addresses the clear shortcomings of the regime and ensures these objectives are finally delivered upon. Euronext is actively contributing to this debate with submissions to consultations and has published the following policy paper on Equities Market Structure. This paper sets out a factual summary of the main market developments in equity market structure under the MiFID framework and proposes some key recommendations for consideration that we believe will ensure effective price discovery and help simplify market structure in Europe to the benefit of end investors.

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MiFID Refit - Euronext High Level Positions on Equities Market Structure

Euronext supports the new Commission’s mandate to promote digital finance in the EU. The EU’s approach in reviewing existing legislative frameworks with a view to developing and promoting the use of new financial technologies is a welcome step in the right direction.

In order to achieve this, we believe that clarifications to the MiFID II framework should be prioritised to accommodate the emergence of new practices, notably in the crypto-assets sector.  

In the below paper, Euronext lays set a set of key principles upon which the EU can build upon in reviewing the existing regime, while maintaining and safeguarding investor protection.

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MiFID Refit - Euronext views on the scope of the Share Trading Obligation

Euronext welcomes the ongoing work with respect to the transparency framework for derivatives. It is our position that the transparency regime for non-equity is, at points, overly complex and at the same time not properly tailored to the different types of instruments. We suggest more needs to be done to ensure transparency is improved. Trading is generally very fragmented across the EU with a significant amount of trading activity done OTC with extremely limited transparency. We urge policymakers to support initiatives that would shift a significant share of trading to transparent and multilateral trading venues that would benefit the market as a whole and enhance visibility for investors. 

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MiFID Refit – Euronext Position on Non-Equity Transparency

This paper addresses the concept of multilateral trading under MiFID II/MiFIR. We believe that in order to reach supervisory convergence with respect to the regulatory treatment of trading platforms changes to MiFID II / MiFIR are required. This paper sets out our recommendations.

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MiFID Refit - Euronext views on MiFID II/MiFIR and the approach to multilateral trading