The Presidency has tabled new compromise texts for the recast Markets in Financial Instruments Directive (MiFID 2) and related Regulation (MiFIR). MiFID 2 extends the ban on proprietary trading on an Organised Trading Facility (OTF) to companies with close links to firms operating that OTF. It also defines the circumstances in which the OTF operator can exercise its discretion when executing orders on the OTF. In its turn, MiFIR has removed the threshold for using a pre-transparency waiver and reinstated a volume cap mechanism. It also mandates the European Securities and Markets Authority (ESMA) to specify the notion of liquidity fragmentation, to ensure liquidity fragmentation is not a consequence of opening access to clearing houses. MiFIR also introduces a new provision on non-discriminatory access to licence benchmarks. (Source: MiFID2 Compromise Text 21 May and MiFIR Compromise Text 21 May)