The European Securities and Markets Authority (ESMA) has launched a public consultation on updated transparency standards for derivatives, as part of the ongoing MiFIR review. The proposals, published in Consultation Package 4, focus on post-trade transparency, package orders, and data requirements for the planned consolidated tape for OTC derivatives.
The initiative follows amendments to MiFIR adopted in 2024, which introduced specific transparency provisions for derivatives. ESMA aims to establish a tailored regime for derivatives, separate from that of bonds and other non-equity instruments.
Key proposals include a revised deferral framework, updated reporting fields, and new thresholds for large-in-scale (LIS) trades. A six-flag system would classify deferrals based on trade size and market liquidity. For post-trade reporting, ESMA suggests adding fields such as “Effective Date,” “Expiry Date,” and “Spread” for interest rate swaps, while removing outdated identifiers for cleared transactions.
Classification
The consultation also proposes a shift from dynamic to static liquidity assessments, based on asset class, clearing status, and notional characteristics. For equity derivatives, three classification models are under review, with a preference for one that accounts for time to maturity. Interest rate derivatives could face either a simplified or more granular classification.
Additional updates cover package transactions and clarify exemptions for central banks under monetary policy or financial stability mandates. The consultation also outlines technical standards for input/output data fields and quality requirements for future consolidated tape providers (CTPs).
The consultation is open until 3 July 2025. Final technical standards are expected to be submitted to the European Commission by the fourth quarter of 2025.
