Revocation of retained EU law Transitional amendments Amendments to the Markets in Financial Instruments Regulation (MiFIR) and the European Market Infrastructure Regulation (EMIR) 1. Removing the Share Trading Obligation (STO)
Shares can be traded over-the-counter (OTC), where contracts are traded directly between two parties, or on a trading venue. Trading venues help to ensure fair and orderly trading as they communicate price information for the instruments that are available to trade on the venue. This helps investors to make well informed decisions and increases market transparency.
	The MiFID II framework includes two types of trading venues where shares can be traded: regulated markets (RMs) and multilateral trading facilities (MTFs). Both are multilateral systems where multiple third-party buying and selling interests in financial instruments interact in accordance with non-discretionary rules.
	The onshored Share Trading Obligation (STO) requires firms to trade shares admitted to trading on a UK RM, MTF, systematic internaliser or an overseas venue assessed as equivalent. It had been implemented by the EU with the aim of increasing transparency in share trading, however there is no evidence that it has achieved this. In fact, evidence suggests that it can prevent firms from accessing the most liquid markets and therefore achieving the best price for investors.
	In December 2020, the FCA announced that it would use its Temporary Transitional Power (TTP) under Part 7 of FSMA 2000 (Amendment) (EU Exit) Regulations 2019 to give a transitional direction modifying the STO. This allows firms to continue trading shares on EU trading venues or systematic internalisers from the end of the implementation period in the absence of an equivalence determination. This approach has allowed firms operating in the UK to continue to access the most liquid markets and get the best outcomes for themselves and their clients when trading European Economic Area (EEA) shares (regardless of the currency they are seeking to trade in).
	The Act removes the STO so that firms can trade shares on any trading venue in the UK or overseas with any counterparty or on an OTC basis. This is intended to ensure that investors can get the best price for their trade.