RTS on market abuse

The prevention and detection of market abuse requires an ongoing monitoring of all ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type. and transactions arranged or executed by persons that professionally arrange or execute transactions, irrespective of whether those ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type. and transactions are executed on the distributed ledgermeans an information repository that keeps records of transactions and that is shared across, and synchronised between, a set of DLT network nodes using a consensus mechanism; (‘on-chain’) or outside the distributed ledgermeans an information repository that keeps records of transactions and that is shared across, and synchronised between, a set of DLT network nodes using a consensus mechanism; (‘off-chain’), including transfers of crypto assets to or from accounts of clientsmeans any natural or legal person to whom a crypto-asset service provider provides crypto-asset services; of the same crypto-asset service providermeans a legal person or other undertaking whose occupation or business is the provision of one or more crypto-asset services to clients on a professional basis, and that is allowed to provide crypto-asset services in accordance with Article 59;.

To facilitate and promote a consistent approach and practices across the Union in relation to the prevention, detection and sanctioning of market abuse, it is necessary to lay down detailed provisions harmonising the content of, the template for and the timing of the reporting of suspicious ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type. and transactions and other aspects of the functioning of DLT.

To share resources, to centrally develop and maintain monitoring systems, and to build expertise in the context of monitoring suspicious ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type. and transactions, persons that professionally arrange or execute transactions in crypto-assetsmeans a digital representation of a value or of a right that is able to be transferred and stored electronically using distributed ledger technology or similar technology; should be able to delegate the prevention and detection of such ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type., transactions and other aspects of the functioning of DLT within a groupmeans a group as defined in Article 2, point (11), of Directive 2013/34/EU of the European Parliament and of the Council(5) Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC (OJ L 182, 29.6.2013, p. 19, ELI: http://data.europa.eu/eli/dir/2013/34/oj).;, or to delegate the data analysis and the generation of alerts, subject to appropriate conditions. Such delegation should neither prevent the competent authoritiesmeans one or more authorities:designated by each Member State in accordance with Article 93 concerning offerors, persons seeking admission to trading of crypto-assets other than asset-referenced tokens and e-money tokens, issuers of asset-referenced tokens, or crypto-asset service providers;designated by each Member State for the application of Directive 2009/110/EC concerning issuers of e-money tokens; from assessing at any time, whether the arrangements, systems and procedures of the person to whom the functions are delegated are effectively in line with the obligation to prevent and detect market abuse. The obligation to report and the responsibility to comply with this Regulation and with Article 92 of Regulation (EU) 2023/1114 should remain with the delegating person.

Crypto asset service providers operating a trading platform should have appropriate trading rules that contribute to the prevention of market abuse. Those entities should also have facilities to replay the ordermeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type. book in ordermeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type. to analyse the trading activity.

A single and harmonised template for electronically submitting a suspicious transaction and order report(STOR) means the report on suspicious orders or transactions, including any cancellation or modification thereof, and other aspects of functioning of the DLT where circumstances might exist indicating that market abuse has been committed, is being committed or is likely to be committed. (‘STOR’) should facilitate the efficient sharing of information on suspicious ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type. and transactions between competent authoritiesmeans one or more authorities:designated by each Member State in accordance with Article 93 concerning offerors, persons seeking admission to trading of crypto-assets other than asset-referenced tokens and e-money tokens, issuers of asset-referenced tokens, or crypto-asset service providers;designated by each Member State for the application of Directive 2009/110/EC concerning issuers of e-money tokens; in cross-border investigations.

The information fields in such a STOR template, where completed clearly, comprehensively, objectively and accurately, should assist the competent authoritiesmeans one or more authorities:designated by each Member State in accordance with Article 93 concerning offerors, persons seeking admission to trading of crypto-assets other than asset-referenced tokens and e-money tokens, issuers of asset-referenced tokens, or crypto-asset service providers;designated by each Member State for the application of Directive 2009/110/EC concerning issuers of e-money tokens; to promptly assess such suspicious ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type. and transactions and take the necessary action. Such STOR template should therefore enable the persons submitting the STOR to provide the information that competent authoritiesmeans one or more authorities:designated by each Member State in accordance with Article 93 concerning offerors, persons seeking admission to trading of crypto-assets other than asset-referenced tokens and e-money tokens, issuers of asset-referenced tokens, or crypto-asset service providers;designated by each Member State for the application of Directive 2009/110/EC concerning issuers of e-money tokens; consider relevant about suspicious ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type., transactions or other aspects of the functioning of the distributed ledger technologyor ‘DLT’ means a technology that enables the operation and use of distributed ledgers; reported and to explain the reasons for the suspicion. The STOR template should also enable the persons submitting the STOR to provide personal datameans personal data as defined in Article 4, point (1), of Regulation (EU) 2016/679; that would make it possible to identify the persons involved in the suspicious activity and assist the competent authoritiesmeans one or more authorities:designated by each Member State in accordance with Article 93 concerning offerors, persons seeking admission to trading of crypto-assets other than asset-referenced tokens and e-money tokens, issuers of asset-referenced tokens, or crypto-asset service providers;designated by each Member State for the application of Directive 2009/110/EC concerning issuers of e-money tokens; in their investigations. Such information should be provided at the outset, so that the integrity of the investigation is not compromised by the potential necessity for a competent authoritymeans one or more authorities:designated by each Member State in accordance with Article 93 concerning offerors, persons seeking admission to trading of crypto-assets other than asset-referenced tokens and e-money tokens, issuers of asset-referenced tokens, or crypto-asset service providers;designated by each Member State for the application of Directive 2009/110/EC concerning issuers of e-money tokens; to revert during an investigation to the person who submitted the STOR. Any processing of personal datameans personal data as defined in Article 4, point (1), of Regulation (EU) 2016/679; under this Regulation should be carried out in compliance with Regulation (EU) 2016/679 of the European Parliament and of the Council(²)Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (OJ L 119, 4.5.2016, p. 1, ELI: http://data.europa.eu/eli/reg/2016/679/oj). on the protection of natural persons with regard to the processing of personal datameans personal data as defined in Article 4, point (1), of Regulation (EU) 2016/679; and on the free movement of such data. The data minimisation principle in particular should be complied with where personal datameans personal data as defined in Article 4, point (1), of Regulation (EU) 2016/679; are collected to ensure compliance with this Regulation.

To facilitate the submission of a STOR, the template should allow for the attachment of documents and materials that are necessary to support the notification made, including in the form of an annex that lists the suspicious ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type. or transactions and detailing their prices and volumes. In addition, the STOR template should allow for the reporting of suspicious behaviours connected to the functioning of the DLT.

Persons professionally arranging or executing transactions in crypto-assetsmeans a digital representation of a value or of a right that is able to be transferred and stored electronically using distributed ledger technology or similar technology; should not notify all ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type. received or transactions conducted that have triggered an internal alert. Such a requirement would be inconsistent with the requirement to assess on a case-by-case basis whether there are reasonable grounds for suspicion.

The analysis of ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type., transactions or other aspects of the functioning of the DLT should factor in not only the internal information of the person professionally arranging or executing transactions in crypto-assetsmeans a digital representation of a value or of a right that is able to be transferred and stored electronically using distributed ledger technology or similar technology;, but all the information publicly available, including information about transactions embedded in a public ledger system.

The STORs should be submitted to the competent authoritymeans one or more authorities:designated by each Member State in accordance with Article 93 concerning offerors, persons seeking admission to trading of crypto-assets other than asset-referenced tokens and e-money tokens, issuers of asset-referenced tokens, or crypto-asset service providers;designated by each Member State for the application of Directive 2009/110/EC concerning issuers of e-money tokens; without delay once a reasonable suspicion about the existence of market abuse has been formed. The analysis as to whether a given ordermeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type. or transaction is to be considered suspicious should be based on facts, not speculation or presumption and should be carried out as quickly as practicably possible. Delaying the submission of a report to incorporate further suspicious ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type., transactions or other aspects of the functioning of the DLT or accumulating several STORs would be irreconcilable with the obligation to act without delay, where a reasonable suspicion has already been formed. In any case, persons professionally arranging or executing transactions in crypto-assetsmeans a digital representation of a value or of a right that is able to be transferred and stored electronically using distributed ledger technology or similar technology; should assess on a case-by-case basis whether several ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type., transactions or other aspects of the functioning of the DLT could be reported in a single STOR.

There might be circumstances where a reasonable suspicion of market abuse is formed after the suspected activity occurred, due to subsequent events or available information. That should not be a reason for not reporting the suspected activity to the competent authoritymeans one or more authorities:designated by each Member State in accordance with Article 93 concerning offerors, persons seeking admission to trading of crypto-assets other than asset-referenced tokens and e-money tokens, issuers of asset-referenced tokens, or crypto-asset service providers;designated by each Member State for the application of Directive 2009/110/EC concerning issuers of e-money tokens;. To demonstrate compliance with the reporting requirements in those specific circumstances, the person submitting the STOR should be able to justify the time discrepancy between the occurrence of the suspected activity and the formation of the reasonable suspicion of market abuse having been committed, being committed or likely to be committed.

To assist persons professionally arranging or executing transactions in crypto-assetsmeans a digital representation of a value or of a right that is able to be transferred and stored electronically using distributed ledger technology or similar technology; in exercising their judgement when considering subsequent suspicious ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type. or transactions, they should be able to recall and review the analysis of STORs which have been submitted, and of those suspicious ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type., transactions and behaviours connected to the functioning of the DLT which were analysed, but in relation to which the competent authoritymeans one or more authorities:designated by each Member State in accordance with Article 93 concerning offerors, persons seeking admission to trading of crypto-assets other than asset-referenced tokens and e-money tokens, issuers of asset-referenced tokens, or crypto-asset service providers;designated by each Member State for the application of Directive 2009/110/EC concerning issuers of e-money tokens; concerned concluded that the grounds for suspicion were not reasonable.

To prevent market abuse to the maximum extent possible, persons professionally arranging or executing transactions in crypto-assetsmeans a digital representation of a value or of a right that is able to be transferred and stored electronically using distributed ledger technology or similar technology; should be able to refine their surveillance systems and to detect patterns of repeated behaviour, the aggregate of which could, considered as a whole, result in a reasonable suspicion of market abuse. Those persons should therefore be required to analyse suspicious ordersmeans each and every order, including each and every quote, irrespective of whether its purpose is initial submission, modification, update or cancellation of an order and irrespective of its type., transactions, behaviours and other aspects connected to the functioning of the distributed ledger technologyor ‘DLT’ means a technology that enables the operation and use of distributed ledgers; which did not lead to a STOR and record such analyses. Such records should also assist such persons in evidencing compliance with Article 92 of Regulation (EU) 2023/1114 and should facilitate the performance by competent authoritiesmeans one or more authorities:designated by each Member State in accordance with Article 93 concerning offerors, persons seeking admission to trading of crypto-assets other than asset-referenced tokens and e-money tokens, issuers of asset-referenced tokens, or crypto-asset service providers;designated by each Member State for the application of Directive 2009/110/EC concerning issuers of e-money tokens; of their supervisory, investigatory and enforcement functions under Article 92 of Regulation (EU) 2023/1114.

Considering that markets in crypto-assetsmeans a digital representation of a value or of a right that is able to be transferred and stored electronically using distributed ledger technology or similar technology; are inherently cross-border, it is necessary to specify coordination procedures between the competent authoritiesmeans one or more authorities:designated by each Member State in accordance with Article 93 concerning offerors, persons seeking admission to trading of crypto-assets other than asset-referenced tokens and e-money tokens, issuers of asset-referenced tokens, or crypto-asset service providers;designated by each Member State for the application of Directive 2009/110/EC concerning issuers of e-money tokens; for the detection and sanctioning of market abuse in case of cross-border market abuse situations. Such coordination procedures should ensure that there are no conflicting investigations or enforcement activities. In that context, cross-border market abuse situations should include cases in which suspicious transactions are carried out in a Member State concerning a crypto-assetmeans a digital representation of a value or of a right that is able to be transferred and stored electronically using distributed ledger technology or similar technology; that is admitted to trading in another Member State and cases in which the crypto-asset service providermeans a legal person or other undertaking whose occupation or business is the provision of one or more crypto-asset services to clients on a professional basis, and that is allowed to provide crypto-asset services in accordance with Article 59; concerned is operating in more than one Member State.

It is necessary to lay down provisions for the transmission of STORs among competent authoritiesmeans one or more authorities:designated by each Member State in accordance with Article 93 concerning offerors, persons seeking admission to trading of crypto-assets other than asset-referenced tokens and e-money tokens, issuers of asset-referenced tokens, or crypto-asset service providers;designated by each Member State for the application of Directive 2009/110/EC concerning issuers of e-money tokens;. Such requirements are critical, in the absence of a transaction reporting regime, to ensure efficient market supervision and enforcement while preventing the transmission of a massive flow of information that would not be useful for the receiving authority.

This Regulation is based on the draft regulatory technical standards submitted by the European Securities and Markets Authority to the Commission (‘ESMA’).

ESMA has conducted open public consultations on the draft regulatory technical standards on which this Regulation is based, analysed the potential related costs and benefits and requested the advice of the Securities and Markets Stakeholder Groupmeans a group as defined in Article 2, point (11), of Directive 2013/34/EU of the European Parliament and of the Council(5) Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC (OJ L 182, 29.6.2013, p. 19, ELI: http://data.europa.eu/eli/dir/2013/34/oj).; established in accordance with Article 37 of Regulation (EU) No 1095/2010 of the European Parliament and the Council(³)Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/77/EC (OJ L 331, 15.12.2010, p. 84, ELI: http://data.europa.eu/eli/reg/2010/1095/oj).,

The European Data Protection Supervisor was consulted in accordance with Article 42(1) of Regulation (EU) 2018/1725(⁴)Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data, and repealing Regulation (EC) No 45/2001 and Decision No 1247/2002/EC (OJ L 295, 21.11.2018, p. 39, ELI: http://data.europa.eu/eli/reg/2018/1725/oj). and delivered their opinion on 22 January 2025,