October 2011

LSEG Response to ESMA Consultation: “Guidelines on systems and controls in a highly automated trading environment for trading platforms, investment firms and competent authorities” ESMA/2011/224

1. Agree that systems and controls are best tools for ensuring that markets remain orderly, fair and stable
2. We broadly agree with the guidelines. These may well remove the need for more intrusive measures with unintended consequences
3. Circuit breakers have a key role in maintaining orderly and fair markets, without influencing genuine market sentiment
4. Highly automated trading is not abusive in itself and there is no evidence of market failure – any regulatory measures should be evidence-based
5. The Commission’s guiding principle of the “same regulation for the same activity/function” and ESMA’s common proportionate approach to all participants should be adopted and followed here

LSEG Response to ESMA Consultation on Systems and Controls ESMA/2011/224 October 2011(file pdf - 352 KB)