What is changing

MiFIDII defines a systematic internaliser (“SI”) as: “an investment firm which, on an organised, frequent, systematic and substantial basis, deals on own account when executing client orders outside a regulated market, an MTF or an OTF” (i.e. trading venue). It also defines thresholds by asset class, above which, activity of this type would result in the investment firm having to register as an SI. Any investment firm registered as an SI then has a variety of obligations, including pre-trade transparency, post-trade transparency and best execution disclosures.

Peel Hunt Approach

While Peel Hunt executes on own account, our UK and European equity trading is trade reported by Peel Hunt to the London Stock Exchange (LSE) or NEX Exchange (NEX). As a result, these trades are brought under the rules the Exchange and are considered to be “on-venue” trades. In this trading, there is therefore no need for Peel Hunt to become a SI.

Peel Hunt will ensure all trading takes place on a trading venue for all asset classes we trade under MiFIDII.

What does this mean for me?

The on-exchange model Peel Hunt operates is well-established and is recognised by both the FCA and ESMA. This is a model that has worked for our clients for many years, so we have opted to maintain this model with our clients wherever possible, rather than risk disruption where it is not required.