MiFID II requirements for clock-synchronization, as summarised in RTS-25, require firms and venues to timestamp events accurately relative to Coordinated Universal Time (UTC) and to an appropriate level of granularity depending on where a trade is executed and the gateway-to-gateway latency of the venue. Specifically, Article 4 of RTS-25 states “Operators of trading venues and their members or participants shall establish a system of traceability to UTC. They shall be able to demonstrate traceability to UTC by documenting the system design, functioning and specifications. They shall be able to identify the exact point at which a timestamp is applied and demonstrate that the point within the system where the timestamp is applied remains consistent. Reviews of the compliance with this Regulation of the traceability system shall be conducted at least once a year.” ESMA/2015/1909 Section 3.1 further clarifies the use of UTC clock-synchronisation for “reportable events”.
This e-book examines the implementation considerations for deployment of robust timekeeping at acceptable locations (application, host and wire) and measurement methodologies (software and hardware) that will meet ESMA’s requirements and forensic intent while giving investment firms greater flexibility, lower complexity and lower costs to fulfil their obligations in a timely manner.