ESMA · ESMA_QA_1598 Answer Published

Algorithmic trading

Regulation
Markets in Financial Instruments Directive II (MiFID II) Directive 2014/65/EU- Secondary Markets
Topic
Direct Electronic Access and algorithmic trading
Submitted
2016-12-19
Answered
2016-12-19
Browse MiFID Register → More Q&As on this regulation →

Question

If an investment firm (firm A) merely transmits a client’s order for execution to another investment firm (firm B) who uses algorithmic trading, is investment firm A engaged in algorithmic trading?

Answer

[ESMA 70-872942901-38 MiFID II MiFIR market structures Q&A, Q&A 3.2] No. The transmission of an order for execution to another investment firm without performing any algorithmic trading activity is not algorithmic trading.
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This Q&A is published by European Securities and Markets Authority and is non-binding. It does not constitute legal advice. Updated weekly from official ESA sources.

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