1. Cooperation with Lobbying Monthly newsletter Annual publication Other issues Intro “MiFID and Regulated Markets” Ludovic AIGROT Chair of the FESE MiFID Task Force Edinburgh, 29 March 2006 “Benefits of MiFID” CityCompass Research Pan-European Executive Briefing l.aigrot@euronext.com www.fese.org

2. Cooperation with Lobbying Monthly newsletter Annual publication Other issues Intro Outline of Presentation A new framework for Regulated Markets Greater competition among execution venues New post-trade reporting rules Other changes affecting RMs Open points at Level 2 and Level 3 Conclusion

3. Cooperation with Lobbying Monthly newsletter Annual publication Other issues Intro A new framework for Regulated Markets  Definitions of Market Operator & Regulated Market: accommodate various market models  Operator’s requirements:  Management and controlling interests  Organisational requirements => Mainly best practice Cooperation with Lobbying

4. Monthly newsletter Annual publication Other issues Intro A new framework for Regulated Markets – cont’d  Requirements regarding admission of financial instruments to trading & mechanisms to verify compliance with issuers’ transparency obligations  Requirements regarding pre- and post-trade transparency of RM  Requirements regarding membership in RMs  Monitoring of compliance by members with RM rules and identification of breaches of the rules, disorderly trading or market abuse => Some requirements that were in market rules are now at EU level (consequences for flexibility/innovation)

5. Cooperation with Lobbying Monthly newsletter Annual publication Other issues Intro Competition Among Venues: MTFs MTF=RM for shares traded on RMs National regime for MTFs trading other instruments Two-way competition Monthly newsletter

6. Cooperation with Lobbying Monthly newsletter Annual publication Other issues Intro Competition Among Venues: SIs Monthly newsletter For some jurisdictions, this represents a major change Differences with RMs/MTFs Duty to clients Commitment of capital Achieving a level playing field

7. Cooperation with Lobbying Monthly newsletter Annual publication Other issues Intro New post-trade reporting rules Monthly newsletter Content Timing Channels => RMs can play a key role in assisting firms to comply with their obligations

8. Cooperation with Lobbying Monthly newsletter Annual publication Other issues Intro Other changes affecting RMs Annual publication Cross-border membership of RMs Access to C&S facilities

9. Cooperation with Lobbying Monthly newsletter Annual publication Other issues Intro Potential Gains and Risks Benefits:  Competition  Integration of markets  Cross-border investments Risks:  Fragmentation of liquidity  Fragmentation of price data  Level playing field among venues

10. Cooperation with Lobbying Monthly newsletter Annual publication Other issues Intro Open Issues at Level 2 and Level 3 Other issues SI definition Best execution Post-trade transparency

11. Cooperation with Lobbying Monthly newsletter Annual publication Other issues Intro Conclusion  Main opportunities and challenges  Areas where industry can work together