It is difficult to capture all legal requirements with respect to transparency of the systematic internaliser’s quotes and transactions at a glance.
Firstly, the pre-trade and post-trade issues must be differentiated.
Another layer of complexity is introduced by distinct legal frameworks regulating systematic internaliser’s transparency for:
- bonds, structured finance products, emission allowances and derivatives, on the one hand, and
- shares, depositary receipts, ETFs, certificates and other similar financial instruments, on the other.
If to concentrate on products like bonds, structured finance products, emission allowances and derivatives firstly, it occurs that to determine transparency obligations we must separately analyse not only clients of the systematic internaliser and other market participants but also different categories of clients of the same systematic internaliser.
Liquid and illiquid markets have their specificities too.
To decode the respective requirements the diagram recently revealed by the ESMA is much helpful.