Retained EU Law SI 2017/589 United Kingdom

Commission Delegated Regulation (EU) 2017/589 of 19 July 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council with regard to regulatory technical standards specifying the organisational requirements of investment firms engaged in algorithmic trading (Text with EEA relevance)

Read it on legislation.gov.uk (opens in a new tab)
Status
In Force
Penalty ceiling
Regulated

Does it bind you?

Business-side roles with duties under this instrument.

Financial Services Firm21 Any Person8

Other Acts binding the same actors

If a role above is yours, these are the other instruments that most often bind it.

Financial Services Firm — also bound by 167 other Acts
Any Person — also bound by 2340 other Acts

What it requires

Regulations creating concrete business duties or carrying penalties, grouped as the instrument is structured. Titles link to the source text — blue means you’re leaving for legislation.gov.uk.

uri:annex/i uri:annex/i Regulated
  • Assess nature, scale and complexity of your algorithmic trading businessFinancial Services Firm
s.art001 General organisational requirements(Article 17(1) of Directive 2014/65/EU) Regulated
  • Establish formal governance for trading systems and algorithmsFinancial Services Firm
s.art002 Role of the compliance function(Article 17(1) of Directive 2014/65/EU) Regulated
  • Ensure compliance staff understand algorithmic trading and maintain contact with technical experts and kill-function controllersFinancial Services Firm
s.art003 Staffing(Article 17(1) of Directive 2014/65/EU) Regulated
  • Employ competent staff for algorithmic trading and maintain their skillsFinancial Services Firm
s.art004 IT outsourcing and procurement(Article 17(1) of Directive 2014/65/EU) Regulated
  • Take full responsibility for outsourced or procured algorithmic trading systemsFinancial Services Firm
s.art005 General methodology(Article 17(1) of Directive 2014/65/EU) Regulated
  • Establish and maintain testing methodologies for algorithmic trading systemsFinancial Services Firm
s.art006 Conformance testing(Article 17(1) of Directive 2014/65/EU) Regulated
  • Test conformance of algorithmic trading systems before deployment or after changesFinancial Services Firm
s.art007 Testing environments(Article 17(1) of Directive 2014/65/EU) Regulated
  • Test algorithmic trading systems in a separate environment from live productionFinancial Services Firm
s.art008 Controlled deployment of algorithms(Article 17(1) of Directive 2014/65/EU) Regulated
  • Set predefined limits before deploying a trading algorithmFinancial Services Firm
s.art009 Annual self-assessment and validation(Article 17(1) of Directive 2014/65/EU) Regulated
  • Perform annual self-assessment and validation of algorithmic trading systemsFinancial Services Firm
s.art010 Stress testing(Article 17(1) of Directive 2014/65/EU) Regulated
  • Stress-test your algorithmic trading systems annuallyFinancial Services Firm
s.art011 Management of material changes(Article 17(1) of Directive 2014/65/EU) Regulated
  • Review and communicate changes to algorithmic trading systemsFinancial Services Firm
s.art012 Kill functionality(Article 17(1) of Directive 2014/65/EU) Regulated
  • Maintain a kill functionality for algorithmic tradingFinancial Services Firm
s.art013 Automated surveillance system to detect market manipulation(Article 17(1) of Directive 2014/65/EU) Regulated
  • Install and maintain automated surveillance system to detect market manipulationFinancial Services Firm
s.art014 Business continuity arrangements(Article 17(1) of Directive 2014/65/EU) Regulated
  • Have business continuity arrangements for algorithmic trading systemsFinancial Services Firm
s.art015 Pre-trade controls on order entry(Article 17(1) of Directive 2014/65/EU) Regulated
  • Implement pre-trade controls, throttles and risk limits for algorithmic tradingFinancial Services Firm
s.art016 Real-time monitoring(Article 17(1) of Directive 2014/65/EU) Regulated
  • Monitor algorithmic trading in real time for disorderly conductFinancial Services Firm
s.art017 Post-trade controls(Article 17(1) of Directive 2014/65/EU) Regulated
  • Continuously operate post-trade controls for algorithmic tradingFinancial Services Firm
s.art018 Security and limits to access(Article 17(1) of Directive 2014/65/EU) Regulated
  • Implement IT security and governance for algorithmic trading systemsFinancial Services Firm
s.art019 General provisions for DEA(Article 17(5) of Directive 2014/65/EU) Regulated
  • Set rules to ensure your DEA clients follow trading venue rulesAny Person
s.art020 Controls of DEA providers(Article 17(5) of Directive 2014/65/EU) Regulated
  • Apply and control pre-trade and post-trade controls for each DEA clientAny Person
s.art021 Specifications for the systems of DEA providers(Article 17(5) of Directive 2014/65/EU) Regulated
  • Implement trading systems and procedures to control DEA client orders and risksAny Person
s.art022 Due diligence assessment of prospective DEA clients(Article 17(5) of Directive 2014/65/EU) Regulated
  • Conduct due diligence on prospective DEA clientsAny Person
s.art023 Periodic review of DEA clients(Article 17(5) of Directive 2014/65/EU) Regulated
  • Perform annual review of due diligence and client systemsAny Person
s.art024 Systems and controls of investment firms acting as general clearing members(Article 17(6) of Directive 2014/65/EU) Regulated
  • Assess, control and monitor clearing systemsFinancial Services Firm
s.art025 Due diligence assessments of prospective clearing clients(Article 17(6) of Directive 2014/65/EU) Regulated
  • Assess clearing clients before trading and review them annuallyAny Person
s.art026 Position limits(Article 17(6) of Directive 2014/65/EU) Regulated
  • Set and enforce trading and position limits for clearing clientsAny Person
s.art027 Disclosure of information about the services provided(Article 17(6) of Directive 2014/65/EU) Regulated
  • Publish your clearing service terms and explain protection levelsAny Person
s.art028 Content and format of order records(Article 17(2) of Directive 2014/65/EU) Regulated
  • Record and keep high-frequency algorithmic trading orders for five yearsFinancial Services Firm
2 other provisions — procedural and definitional
s.annex i para.1 When considering the nature of its business, an investment firm...
s.art029 Entry into force and application(Article 17(2) of Directive 2014/65/EU)

Duty extraction and severity labels are Guvnor’s analysis of the instrument, not the instrument itself. Always verify against the linked source text.