EU Commission consults on amendments to the MiFIR Delegated Regulation

On 8 August the EU Commission published a draft delegated regulation and consultation on amendments to Regulation (EU) 2017/567 (the “MiFIR Delegated Regulation”).

These amendments follow on from the MiFID/MiFIR review (also known as MiFID III and MIFIR II), and the EU Commission is proposing changes to the MiFIR Delegated Regulation to reflect the changes made to the “Level 1” provisions. This also follows on from the European Securities and Markets Authority (“ESMA”) delivering its technical advice to the Commission on potential changes to the MiFIR Delegated Regulation in December 2024.

The changes made include:

• Amending the Articles determining what constitutes a “liquid market”. This includes (as mandated by the Level 1) replacing the concept of a “free float” with “market capitalisation”. The EU Commission has largely followed the ESMA technical advice on the changes in this space.
• Deleting provisions determining what constitutes a “reasonable commercial basis” for charging for market data by trading venues and systematic internalisers. Notably, these provisions have now been updated and moved to Regulatory Technical Standards, which have been adopted by the EU Commission.
• Removing the detailed requirements in the MiFIR Delegated Regulation on reporting of portfolio compressions (given the Level 1 provisions on this were removed as part of the MiFID/MiFIR review).
• As empowered by the Level 1, the EU Commission has provided further clarity on the definition of “post-trade risk reduction services”. In summary, these are now defined as services that meet all the following conditions:
  • they are provided by a third-party service provider through the use of an algorithm on an all or nothing basis;
  • they achieve a reduction in risk in each derivatives portfolio submitted;
  • they are market-risk neutral;
  • where new derivatives transactions result, they do not contribute to price formation.

The amendments also clarify that post-trade risk reduction services should include portfolio compression services, rebalancing services and basis risk optimisation services.

• Other consequential changes such as removing the specification of “size specific to the financial instrument” in Article 16 given it is redundant in light of changes to the non-equity systematic internaliser regime.

Next steps

The draft delegated regulation is open for comment until 5 September 2025, with the Commission planning to adopt the regulation in Q4 2025.

The changes are intended to apply at different points:

• changes to the liquid market criteria are expressed to apply from 2 March 2026;
• deletion of the reasonable commercial basis requirements are expressed to apply once the relevant RTS applies (9 months after the RTS enters into force);
• otherwise changes will apply upon entry into force (20 days after publication in the OJEU).

Firms should therefore consider the impact of the draft delegated regulation. In particular, MiFID/MiFIR review changes relating to post-trade risk reduction services only apply once the delegated regulation is in place, so firms should consider preparing for this and review the definition of post-trade risk reduction services.