CHAPTER I

DETERMINING LIQUID MARKETS FOR EQUITY INSTRUMENTS

Determining liquid markets for certificates(Article 2(1)(17)(b) of Regulation (EU) No 600/2014)
Article 4
1
For the purposes of Article 2(1)(17)(b) of Regulation (EU) No 600/2014, a certificate that is traded daily shall be considered to have a liquid market where all of the following conditions are satisfied:
a
the free float is not less than EUR 1 million;
b
the average daily number of transactions in the certificate is not less than 20;
c
the average daily turnover for the certificate is not less than EUR 500 000.
2
For the purposes of paragraph 1(a), the free float of a certificate shall be the issuance size irrespective of the number of units issued.
3
For the purposes of paragraph 1(c), the daily turnover for the certificate shall be calculated by aggregating the results of multiplying, for each transaction executed during a trading day, the number of units of the certificate exchanged between the buyer and the seller by the price per unit.
4
During the six-week period commencing on the first trading day following the first admission of a certificate to trading on a trading venue, that certificate shall be considered to have a liquid market for the purposes of Article 2(1)(17)(b) of Regulation (EU) No 600/2014 where the estimated free float at the start of the first trading day stands at not less than EUR 1 million, and, where, according to estimated data for that period, the conditions set out in paragraph 1(b) and (c) are fulfilled.
5
Where fewer than five certificates traded on UK trading venues and first admitted to trading in the United Kingdom are considered to have a liquid market in accordance with paragraph 1, the FCA may designate one or more certificate first admitted to trading on those trading venues as certificate considered to have a liquid market, provided that the total number of certificates first admitted to trading in the United Kingdom and considered to have a liquid market does not exceed five.
Words in Art. 4(5) substituted (31.12.2020) by The Markets in Financial Instruments (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1403), regs. 1(3), 59(1)(a) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)
Words in Art. 4(5) substituted (31.12.2020) by The Markets in Financial Instruments (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1403), regs. 1(3), 59(1)(b) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)
Words in Art. 4(5) substituted (31.12.2020) by The Markets in Financial Instruments (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1403), regs. 1(3), 59(1)(c) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)