FCA publishes explanatory note on derivatives trading obligation

The FCA has published an explanatory statement relating to its Direction on the derivatives trading obligation. It issued the new direction at the end of 2024 to modify the UK DTO under UK MiFIR. The direction allows firms subject to the UK DTO to execute trades on EU trading venues, subject to complying with certain conditions. The FCA needs to confirm any direction that remains in place for more than 6 months, to confirm that the relevant conditions will be met for the subsequent 6 month period.

The new statement covers the 6 months to 30 June 2026.