FCA flexes its MiFIR reporting muscles

Although the firm identified the reporting failure during a third-party review, it did not proactively disclose the breach to the FCA. Instead, the regulator identified discrepancies in transaction data itself, exposing critical weaknesses in the firm’s transaction reporting systems and controls for a high-risk investment product.

While this is not the first time the FCA has penalised firms for transaction reporting failures, it is the first enforcement action under UK MiFIR specifically. The FCA’s stance is clear: it expects complete and accurate transaction reports and timely reporting to support the critical role of market monitoring, and it will take enforcement action against firms that fail to meet these obligations completely.

‘As a data-led regulator it is vital that firms submit accurate and timely transaction reports, and promptly bring any failures to our attention. Infinox failed to do this, which meant market abuse could have flown under the radar and risked the integrity of the market.” Steve Smart, joint executive director of enforcement and market oversight at the FCA

The Role of Reference Data in MiFIR, EMIR Refit, and Global Reporting Regimes

At the heart of MiFIR’s transaction reporting obligations is the requirement for investment firms to submit accurate and complete transaction details to the regulator no later than the close of the following working day (Article 26(1) MiFIR). These reports must include essential information such as the financial instrument traded, the execution price and details of the participants involved.

While market data such as price and volume are crucial, the accuracy of transaction reference data—like the financial instrument (ISINs) and counterparty identifiers (LEIs) are just as critical. Every single data point must be correct to ensure accurate - and successful - transaction reporting, regulatory compliance and effective market oversight.

For UK MiFIR, firms must report up to 65 regulatory fields, while EU MiFIR requires 48 fields. Similar complexity exists under the EMIR Refit framework which came into effect in 2024. The EU EMIR Refit expanded reportable fields from 129 to 203, while the UK version added an extra field, bringing the total to 204, and many of these new fields relate specifically to reference data including counterparty classification and detailed instrument attributes.

Reporting data for MiFIR and EMIR must also be submitted in a standardised format which follows the ISO 20022 XML standard. This structure is designed to enable automated validation, ensuring that inaccuracies and inconsistencies are identified and corrected before they cause compliance failures.

Unintended consequences of poor quality reference data

Reference data is a cornerstone of regulatory reporting, yet many firms struggle with inconsistent, incomplete and incorrect data potentially leading to reporting failures.

For example, under EMIR regulation, counterparties must report whether they are financial or non-financial entities. If this information is missing or incorrect, the transaction report will be rejected, leading to costly remediation efforts and potential regulatory scrutiny. Under MiFIR, errors in instrument reference data can result in transaction reports being misclassified or failing validation altogether.

Adding to the complexity, financial institutions operating across multiple jurisdictions must navigate different reporting requirements and field structures. While MiFIR and EMIR Refit share common principles, local implementation varies. For instance, the UK’s EMIR Refit contains slightly different execution agent reporting requirements compared to the EU’s version. Meanwhile, regulators in other markets—such as the CFTC in the US, ASIC in Australia, and JFSA in Japan—have also introduced updates to reporting rules, each with its own reference data obligations challenges.

Stepping up to challenge of accurate reference data

So, how can firms ensure that their reference data is fit for purpose and compliant with evolving regulatory demands? The answer lies in data quality assurance, standardisation, and workflow automation. This is where we come in. A combination of 25+ years’ specialist focus and unrivalled expertise in providing industry-leading, accurate, standardised derivatives reference data - covering 120+ exchanges and multiple platforms - supports timely, ‘right first time’ regulatory reporting. The best data, delivered via API, feed or our online platform, supports:

Data validation and enrichment – ensuring that reference data is matched and validated against industry standards, and enriched with accurate details before submission to regulators. Our reference data provide specific regulatory fields including those required for MiFIR and EMIR.

Automated data management – reference data can be delivered by API or feed to support firms’ automated data collection, validation and reconciliation processes and workflows, and ISO 20022 XML reporting in line with global regulatory standards.

Proactive data monitoring ”never miss a trade” - flexible, ‘always on’ data delivery options enable firms to capture critical reference data at all times, even in the event of system failures (i.e. from the FOW Professional online platform), to support transaction efficiency and regulatory compliance.

A new era of enforcement in regulatory reporting?

The FCA’s enforcement action in January of this year heralds a shift towards stricter oversight of MiFIR reporting compliance - it is clear that the ‘honeymoon period’ is over and that the FCA and other regulators will likely be far less accommodating to firms that don’t follow the regulatory reporting rules. For financial firms operating in and across different financial markets and geographies, keeping on top of multiple, complex and different reporting obligations and workflows in Europe, Asia and the US means the pressure of firms to maintain accurate reference data will only intensify.

In this complex, time-sensitive and potentially business critical environment, firms that invest in high-quality reference data with assured delivery supporting automated post trade processing and reporting workflows will be best positioned to meet today’s onerous compliance challenges.

Whether supporting MiFIR, EMIR and any other regulatory framework, one thing is clear: reference data is not just an administrative necessity, it is the bedrock of market transparency, risk management and regulatory compliance.

Contact us to see why financial businesses rely on our reference data in their framework and how we can help you be regulatory compliant.