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IT - InET Nordic - Introduction of New Manual Trade Types

Nasdaq Nordic and Nasdaq Baltic will introduce new trade types for manual trades in equities and securities in September 2018 to comply with MiFID II regulations. The new trade types will categorize negotiated trades and update how non-standard settlement trades affect trading statistics. Testing will begin in July 2018, with the changes taking effect in September after regulatory review. Market participants should update their FIX and NLS protocols for the new trade types.

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125 views

IT - InET Nordic - Introduction of New Manual Trade Types

Nasdaq Nordic and Nasdaq Baltic will introduce new trade types for manual trades in equities and securities in September 2018 to comply with MiFID II regulations. The new trade types will categorize negotiated trades and update how non-standard settlement trades affect trading statistics. Testing will begin in July 2018, with the changes taking effect in September after regulatory review. Market participants should update their FIX and NLS protocols for the new trade types.

Uploaded by

WillianSantos
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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2018-07-03

IT – INET Nordic – Introduction of new Manual Trade Types (43/18)


Nasdaq Nordic and Nasdaq Baltic will introduce new Trade Types for Manual Trades in Equity
Instruments and Warrants and Certificates (Securitized Derivatives) executed in INET Nordic. The
new Trade Types are planned to be introduced in September 24, 2018.

At the same time, Nasdaq Nordic and Nasdaq Baltic will introduce a change to how existing Trade
Type ‘Non-Standard Settlement’ updates trading statistics for Equity Instruments and Securitized
Derivatives traded in INET Nordic.

Background
New Trade Types are being introduced in order to cater all categories defined by MiFID II for
negotiated transactions subject conditions other than current market price in Equity Instruments, in
accordance with MiFIR Article 4(1)(b)(iii) and further specified in Commission Delegated Regulation
2017/587 (“RTS 1”) Article 6.

In addition, Trade Type ‘Derivative Related Transaction’ is renamed as ‘Exercise Related Transaction’.
This Trade Type is offered in accordance with RTS 1 Article 6(c).

Currently, RTS 1 Article 6(c) is offered as Trade Type Derivative Related Transaction, and RTS 1
Articles 6(d)-(f) are offered as Trade Type Exchange Granted via a general authorization given in INET
Nordic Market Model.

Details
New Trade Types with definitions (pending Regulatory review), and in case of Manual Trade is below
Large in Scale (LIS) threshold in Equity Instruments, the applicable RTS 1 paragraph and MiFID II
waiver indicator, are:

Trade Type Definition (pending Regulatory review) RTS 1 MiFID II


article waiver
indicator
‘Exercise A Trade resulting in the delivery of financial instruments Article PRIC
Related in the context of the exercise of convertible bonds, 6(g)
Transaction’ options, covered warrants or other similar financial
derivative.
‘Linked A Trade contingent on the purchase, sale, creation or Article PRIC
Component redemption of a derivative contract or other financial 6(c)
Transaction’ instrument where all the components of the trade are
meant to be executed as a single lot.
‘Beneficial A Trade executed by a management company as defined Article PRIC
Ownership in Article 2(1)(b) of Directive 2009/65/EC or an alternative 6(d)
Transfer investment fund manager as defined in Article 4(1)(b) of
Transaction’ Directive 2011/61/EU which transfers the beneficial
ownership of financial instruments from one collective
investment undertaking to another and where no
investment firm is a party to the transaction.
‘Give-up or A Trade is a give-up transaction or a give-in transaction. Article PRIC
Give-in 6(e)
Transaction’
‘CCP Related A Trade has as its purpose the transferring of Instruments Article PRIC
Transaction’ as collateral in bilateral transactions or in the context of a 6(f)
CCP margin or collateral requirements or as part of the
default management process of a CCP.

Manual Trades where the trade size is at or above LIS threshold are executed under Large in Scale
pre-trade transparency waiver in accordance with MiFIR Article 4(1)(c) for Equity Instruments and
MiFIR Article 9(1)(a) for Securitized Derivatives. For those Manual Trades, no MiFID II waiver
indicator is applicable. In Securitized Derivatives, Manual Trades only at or above LIS threshold are
allowed.

Nasdaq Iceland
New Manual Trade types are available for trading in Equity Instruments on Nasdaq Iceland.
However, negotiated transactions waiver as well as LIS thresholds in Equity Instruments on Nasdaq
Iceland follow MiFID I instead of MiFID II.

Protocol specifications
Nasdaq FIX 5.0 On-Exchange Trade Report and Nasdaq Nordic Equity Last Sale (NLS) protocol
specifications are updated with new and updated Trade Type values. See History section in
respective protocol specification for latest updates.

Current and future versions of INET protocol specifications are available at the Nasdaq Nordic
Technical Information website under INET Nordic Protocol Specifications.

Time schedule
 INET Test (NTF) and GCF TST4 – July 11, 2018
 INET and GCF Production – September 24, 2018

Trading Statistics
Trades reported with above new Trade Types update only Turnover.

Trades reported with Trade Type ‘Non-Standard Settlement’ update currently only Turnover. As of
September 24, 2018, ‘Non-Standard Settlement’ will update:

 Turnover
 Last price
 Average price
 High/ low price.

Nasdaq Nordic Member Rules


Please note that these changes will be reflected in the Nasdaq Nordic Member Rules, effective
September 24, 2018. The change is subject to Regulatory review.

INET Nordic Market Model


Market Model will be updated and will be effective as of September 24, 2018.
Questions and feedback
For further information and feedback concerning this information, please contact:

Ronny Thellman
Tel: +46 8 405 6313
E-mail: [email protected]

Support
For technical questions, please contact Nasdaq Cash Equity Operations:

Tel: +46 8 405 6410


E-mail: [email protected]

Best regards,

Nasdaq Nordic and Nasdaq Baltic

Nasdaq Copenhagen, Nasdaq Helsinki, Nasdaq Iceland, Nasdaq Riga, Nasdaq Stockholm, Nasdaq
Tallinn and Nasdaq Vilnius are respectively brand names for Nasdaq Copenhagen A/S, Nasdaq
Helsinki Ltd, Nasdaq Iceland hf., Nasdaq Riga AS, Nasdaq Stockholm AB, Nasdaq Tallinn AS and AB
Nasdaq Vilnius. Nasdaq Nordic represents the common offering by Nasdaq Copenhagen, Nasdaq
Helsinki, Nasdaq Iceland and Nasdaq Stockholm. Nasdaq Baltic represents the common offering by
Nasdaq Tallinn, Nasdaq Riga and Nasdaq Vilnius
.

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