Our Secondary Markets and Legal Expert Groups have contributed to our response to ESMA's Consultation Paper on MiFID/MiFIR Technical Advice. We have focused our response to the consultation paper on legitimacy of inducements to be paid to/by a third person and SME Growth Markets.
Regarding ESMA’s proposals on legitimacy of inducements to be paid to/by a third person, we argued that these will have an adverse effect on small and mid-size quoted companies’ ability to raise finance by reducing the research available on these companies. We urged ESMA to reconsider their position and take into consideration the detrimental impact that this could have on growing companies that are essential for European economic growth.
We supported the concept and introduction of SME Growth Markets. We noted that the introduction of SME Growth Markets is particularly essential as the MiFID I framework classifies existing growth markets for smaller companies as multilateral trading facilities (‘MTFs’), which does not distinguish the primary market function that these markets serve from the purely secondary market functions played by almost all other MTFs. We supported that the primary market function deserves to be recognised and treated differently in order to facilitate access to capital by SMEs across Europe.
