Though many believe that version II is more stringent than the version
I, version II does address many of the issues that will provide and strengthen
investor protection, leverage the technological advances including new
market-places and the resulting data fragmentation.
One issue that concerns the Buy-side is the official response to dark pools.
Recent attention on this trading marketplace has focused on negatives aspects
of dark pools. This has heightened Buy-side attention as they believe that dark
pools offer distinct advantages. I have confidence that the Council will weigh
the upside and downside of dark pools. They need to protect the integrity of
the market but also must maintain the benefits provided by alternatives trading
systems.
Also it is critical to move faster than the expected 2014 / 2015
implementation date. A two- year gap
leaves too much time for new technology to increase or further impact the
business resulting in practices with dire consequences. Instead a more
evolutionary solution of regulatory changes, on a timely basis, to address
current and evolving challenges will deliver faster solutions to market
unbalances and level the playing field for all market participants.
Another challenge is ensuring that the Buy-side is involved and
encouraged to offer opinions and hopefully contribute to the resolution.