Trade Reporting vs Transaction Reporting

Regulatory trade and transaction reporting is a strange beast.  I think most people fall into it by accident rather than choosing it (including myself), but people still get confused with the terminology and understandably so, as it does get complex.  Inconsistent wording across regulations doesn’t help, as they interchange between using the term ‘trade’ and the term ‘transaction’ and if you are lucky, a bit of ‘position’, even when it is the same regulator writing the rules. If you are sitting comfortably then I’ll begin (to confuse you)…

MiFIR trade reporting

Let’s start with MiFIR trade reporting (RTS 1 and 2). This is real-time trade transparency reporting, made public at the point of execution via an Approved Publication Arrangement (APA). Simple enough but MiFIR also has transaction reporting (RTS 22).  This is T+1 reporting of all transactions, either directly to the regulator or via an Approved Reporting Mechanism (ARM), to allow the European regulators to monitor market abuse.  Similar by name but very different in nature…

Not to forget MiFIR also has its Commodities Derivatives Reporting (RTS 21) but that’s at position level.  Hold on…

EMIR trade reporting

EMIR has trade reporting where you report your derivative transactions to a Trade Repository (TR). That is of course unless you take up the option under EMIR to report some of your trades at position level instead! Keep up!

Even though EMIR is more similar to SFTR transaction reporting than MiFIR trade reporting, both EMIR and SFTR mandate reporting to a Trade Repository and not a Transaction Repository. Yep, I’m lost…

The good news is that the sensible people in the Asia Pacific region have tried to keep it consistent and retain the model of transaction reporting. HKMA, MAS & ASIC all use transaction reporting terminology.  Phew…

Dodd-Frank Act price reporting

The US Dodd-Frank Act (DFA) Part 43 price reporting, similar to MiFIR trade reporting, reports through a Swap Data Repository (SDR) that accepts data relating to (you guessed it) swap transactions, not a standalone publication tool like an APA.  Part 45 transaction reporting or swap reporting, also uses trade reporting terminology throughout.  Full circle, for CFTC commodities position reporting, all the terms trade, transaction and position are used.  HELP!!

• Clear as mud?  Our team of ex-regulators and regulatory reporting specialists love talking about this stuff and can guide you though any reporting challenge. For a conversation about your trades, I mean transactions, across any of the global reporting regimes, please contact us.