Tullett Prebn Executin and Order Handling Plicy Nvember 2017 This Executin and Order Handling Plicy (the Plicy ) is applicable t executin services prvided t yu by any f the fllwing entities and any f their successrs, tgether with any affiliates f them that are authrised t prvide investment services and perate under the Tullett Prebn brand within the UK r any ther member state f the Eurpean Unin/Eurpean Ecnmic Area ( EU/EEA ): Tullett Prebn (Eurpe) Limited; Tullett Prebn (Securities) Limited; r Tullett Prebn (Equities) Limited, ( TP ). The Plicy shuld be read in cnjunctin with the Tullett Prebn Terms f Business. Executin Services In prviding executin services t yu in relatin t financial instruments (as set ut in Annex 1), TP may (subject always t applicable law): (1) arrange a transactin in the ver-the-cunter financial r cmmdities markets, which may be inside r utside f the EU/EEA; (2) arrange fr the submissin f trading interests t a trading venue fr executin, which may be inside r utside f the EU/EEA; (3) arrange a transactin which is submitted t a trading venue fr registratin, which may be inside r utside f the EU/EEA; (4) within an TP-perated rganised trading facility ( OTF ), arrange and execute rders placed n that TP OTF; r (5) transmit an rder t anther entity (which may be an affiliate f TP) fr executin in accrdance with ne f the methds described abve. Organised Trading Facilities The Eurpean regulatry package knwn as MiFID II intrduced OTFs as a new type f multilateral trading venue alngside regulated markets ("RMs") and multilateral trading facilities ( MTFs ). Details f the OTFs perated by TP are cntained in the fficial rulebks, which shuld be cnsulted fr infrmatin n the financial instruments, ther prducts and transactin types that are tradable within them. The peratr f an OTF is required t exercise discretin in relatin t the executin f rders, either when deciding t place r retract an rder n the OTF and/r when deciding nt t match ptential rders available in the system. The exercise f discretin within TP s OTFs is separate frm the requirement t prvide best executin, which is discussed in mre detail in Annex 2. Business Mdels TP s executin services are prvided thrugh:
vice brking, where brkers, supprted by prprietary screens displaying histrical data, analytics and real-time prices, discver price and liquidity fr their clients; and electrnic platfrms. These arrangements can be cmbined in hybrid brking mdels, which allw fr the interactin f trading interests thrugh bth vice and electrnic systems. The business brkers prducts using three majr executin methds: Name Passing (where all cunterparties t a transactin settle directly with each ther r thrugh a settlement agent); Matched Principal (where a TP entity is a cunterparty t bth sides f a matching trade); r Exchange Give-Up (where a brker places an rder fr a client n a trading venue and then gives up the resulting trade t the relevant client r its clearer). A derivatin f this business mdel includes trades which are privately negtiated and registered n an exchange r MTF r prvides the clients with a settlement prcess thrugh a central cunterparty (CCP settlement). When Best Executin Is Owed TP will take sufficient steps t achieve the best verall trading result when acting as brker in the executin r receptin and transmissin f rders in financial instruments and, when acting as the peratr f an OTF, in cncluding transactins in financial instruments n that OTF. This means that TP will aim t prvide best executin subject t and taking int accunt the nature f yur rders, the prices available t TP in the market, the nature f the market in questin and a reasnable assessment f the relevant executin factrs (which are detailed belw). TP s intentin is, s far as pssible, t exercise cnsistent standards and perate the same prcesses acrss all markets, clients and financial instruments in which it perates. TP als intends t prvide yu and ther market participants with access t (where pssible) tradable prices n a nn-discriminatry basis. Hwever, the diversity in thse markets and instruments, what TP knws f yur wn trading intentins, and the kind f rders that yu may place, mean that different factrs will have t be taken int accunt in relatin t any particular transactin. When Best Executin Is Nt Owed Ntwithstanding the intentins expressed abve, TP des nt undertake t prvide best executin in the fllwing circumstances: Eligible Cunterparties If yu are classified as an Eligible Cunterparty, yu will nt be entitled t best executin under the UK Financial Cnduct Authrity ( FCA ) r equivalent EU/EEA rules (pursuant t Article 30 f MiFID II, which disapplies the best executin bligatin under Article 27 f MiFID II fr Eligible Cunterparties).
Legitimate reliance In the whlesale OTC derivatives and bnd markets (and fr the avidance f dubt this wuld include derivatives in Equities, Energy and Cmmdities) in which TP perates (and as recgnised by the Eurpean Cmmissin) it is nrmal market practice fr buyers and sellers t shp arund by appraching several brkers/dealers fr a qute. In these circumstances, there is n expectatin between the parties that the brker/dealer chsen will we best executin. As a sphisticated participant in the whlesale markets, unless yu advise us t the cntrary we will assume that this is yur nrmal trading behaviur. When Best Executin is deemed t have been prvided TP is deemed t have prvided best executin in the fllwing circumstances: Client Instructins Where yu prvide TP with a specific instructin in relatin t yur entire rder, r any particular aspect f yur rder, including an instructin fr yur trade t be executed n a particular venue, TP will execute the rder in accrdance with yur instructins. In fllwing yur instructins, TP will be deemed t have taken all sufficient steps t prvide the best pssible result fr yu in respect f the rder, r aspect f the rder, cvered by yur specific instructins. 1 Nte that when yu aggress a resting rder r place an rder n a TP MTF, the best executin prvisins f MiFID II will nt apply t the peratr f the MTF. Clients TP clients must be classified as either Eligible Cunterparties r Prfessinal Clients as defined in MiFID II and by the FCA. The classificatin f a client is ntified t the client in a separate ntice (the Client Classificatin Ntice). MiFID II entitles clients t request a different client classificatin frm that ntified in the Client Classificatin Ntice in respect f ne r mre investment services r transactins, r ne r mre types f transactin r prduct. Any such request must be made t TP in writing. Hwever, because TP always intends t handle rders and indicatins f interest in an equitable and cnsistent manner, nce a client is classified as an Eligible Cunterparty fr the purpses f a particular instrument, it is TP s plicy that it will decline t prvide services shuld an Eligible Cunterparty request t be re-classified fr the purpses f ne transactin f a type it custmarily undertakes. There may be exceptinal circumstances and TP will cnsider each written request n a case by case basis. Executin Venues This Plicy sets ut the venues n which TP may execute yur rder. It has identified thse venues n which TP mst regularly seeks t execute yur rders and which TP believes ffer the best prspects fr achieving the best pssible results fr yu, taking int accunt the executin factrs detailed belw. TP is able t execute trades n yur behalf n any f the fllwing executin venues: 1 Article 66(3)(f) f DA2.
any MTF perated by TP; any OTF perated by TP; regulated markets, MTFs and OTFs nt perated by TP; (in a quasi-venue r nn-venue capacity), systematic internalisers, market makers r ther liquidity prviders; and executin venues in nn-eu/eea cuntries that perfrm a similar functin t any f the freging t which TP has access and which are listed in Annexes 3 9 accrding t the relevant classes f financial instrument. Please nte that this list is nt intended t be exhaustive and TP reserves the right t utilise alternative executin venues. When selecting the venue n which t transact, TP will take sufficient measures t ensure that the selected venue btains the best pssible trading result fr its clients, subject t the fllwing general factrs: In the OTC markets in which TP perates, it can nly give clients visibility t prices that have been cmmunicated t TP by ther clients that perate in the same market; accrdingly, any best utcme will slely be within these limits. Hwever, when executing rders r taking a decisin t deal in OTC prducts, including bespke prducts, TP will check the fairness f the price prpsed t the client by gathering market data used in the estimatin f the price f such prduct and, where pssible, by cmparing with similar r cmparable prducts; TP will prvide details f all tradable bids and ffers (subject t the ther matters referred t belw); Time availability f prices in many markets, there are lulls and spikes in trading as negtiatins align trading interests at different times and different parts f the curve; accrdingly, the last traded price may nt always be available r act as a reliable indicatr f current price; TP cannt allw clients t trade in a market unless it is reasnably satisfied that the client (via an agent r therwise) is peratinally capable f settling the relevant trade; TP cannt cntrl either the cst f credit (credit premium) r credit acceptance between its clients; and where TP invites yu t chse ne executin venue rather than anther, we will prvide fair, clear and nt misleading infrmatin t prevent yu frm chsing ne executin venue rather than anther n the sle basis f the price plicy applied by TP. 2 In cases where TP applies different fees depending n the executin venue, we will explain these differences t yu in sufficient detail t allw yu t understand the advantages and disadvantages f the chice f a particular executin venue. 3 Similarly, TP will infrm yu f any inducements (if any) it receives frm an executin venue and f the value f any mnetary r nn-mnetary benefits it receives in circumstances where TP charges mre than ne participant in a transactin. 4 The executin venues n which TP places particular reliance in meeting its best executin bligatins, and the relevant factrs fr selecting a particular executin venue, als vary depending n the class f financial instruments t which yur rder relates. Please see Annexes 3 9 fr mre detail n the variatin that applies acrss the varius classes f 2 Article 66(5) f DA2. 3 Article 66(4) f DA2. 4 Article 66(6) and (7) f DA2.
financial instruments. 5 These Annexes als specify in which circumstances TP may execute an rder utside a trading venue. 6 TP will publish the tp five executin venues in terms f trading vlumes fr all executed client rders per class f financial instruments in accrdance with the prvisins in RTS 28 f MiFID II. This will be made available n TP s website. Executin Factrs In the absence f express instructins frm yu, TP will exercise its wn discretin in determining the factrs that TP needs t take int accunt fr the purpse f prviding yu with the best pssible result. These executin factrs in the whlesale markets in which TP perate will include, but are nt restricted t, the: characteristics f the client; size, nature and characteristics f the rder; characteristics f the executin venue n which that rder can be directed; likelihd and speed f executin; and price and csts f executin. The imprtance f each f the executin factrs may be weighted differently depending n the class f financial instruments and the type f service prvided. Please see Annexes 3 9 fr mre detail n the variatin that applies acrss the varius classes f financial instruments. 7 Order Handling When handling rders, ur bjective is t: ensure that executed client rders are prmptly and accurately recrded and allcated; and carry ut therwise cmparable client rders sequentially and prmptly unless: (i) therwise instructed by the client; (ii) the characteristics f the rder r prevailing market cnditins make this impracticable; r (iii) the interests f the client require therwise. In the case f client limit rders (as defined by MiFID II) in respect f shares admitted t trading n a regulated market r traded n a trading venue which are nt immediately executed under prevailing market cnditins, TP will take measures t facilitate the earliest pssible executin f that rder by making public immediately that client limit rder in a manner which is easily accessible t ther market participants (by submitting the rder fr executin t a regulated market r a MTF r ensuring the rder is published by a data reprting services prvider lcated in an EU member state and can be easily executed as sn as market cnditins allw) unless: express instructins are given by the client nt t publish; r the rder is large in scale cmpared t nrmal market size (as defined by MiFID II). 5 Article 66(3)(b) and (c) f DA2. 6 Article 66(3)(e) f DA2. 7 Articles 64(1) and 66(3)(a) and (d) f DA2.
When TP accepts an rder frm yu t effect a single transactin r a series f transactins fr the purpse f acquiring r dispsing f all r part f a prtfli r a large basket f securities, it may undertake ther client rders with respect t the cnstituent securities r any related security which culd have an impact n the price f the cnstituent security. If yu are a nn-exempted US client under Sectin 15a-6 f the Securities Exchange Act f 1934, an appinted US Brker Dealer will act in the capacity f US intermediary brkerdealer fr securities transactins. The appinted US Brker Dealer used in each instance will be dependent n the TP entity that has undertaken the transactin with yu and will be ntified t yu as necessary. Settlement f Orders Where it is respnsible fr verseeing r arranging the settlement f an executed rder, TP will take all reasnable steps t ensure that any client financial instruments r client funds received in settlement f that executed rder are prmptly and crrectly delivered t the accunt f the apprpriate client. Aggregatin and Allcatin TP may aggregate yur rders with its wn rders, that f its affiliates and thse f ther clients, in rder t imprve the quality f executin. Whilst TP will nly aggregate client rders if it is unlikely the aggregatin will wrk verall t the disadvantage f thse clients whse rders are aggregated, it is pssible that the effect f such aggregatin may wrk t the disadvantage f a client in respect f particular rders. In the unlikely event that TP aggregates yur rder with that f anther client, the subsequent executin will be prmptly recrded and allcated fairly. TP will nt give preference t ne client ver anther. Misuse f Infrmatin / Cnfidentiality TP will take all reasnable steps t prevent the misuse f infrmatin relating t pending client rders by any f its relevant persns. Fr this purpse, TP perates barriers which limit the flw f ptentially sensitive infrmatin between clleagues and different areas f the business. TP s internal dealing rules prevent emplyees in pssessin f price sensitive infrmatin frm taking advantage f that infrmatin by dealing in that security r arranging fr smene else t d s. Further details in respect f the cnfidentiality prcedures implemented by TP are prvided in the TP ICAP Cnflicts f Interest Management Plicy which is available n the TP website and which can als be btained by cntacting the client n-barding department n COB@tullettprebn.cm. Mnitring and Review TP will mnitr the effectiveness f its rder executin and rder handling arrangements as dcumented in this Plicy in rder t identify and, where apprpriate, incrprate any required amendments t this Plicy and any attendant prcedures. TP will assess, n a regular basis, whether the executin venues included in this Plicy prvide fr the best pssible result fr its clients r whether TP needs t make changes t its executin arrangements. Such assessments will include, but will nt be limited t:
reviewing the quality f executin reprts prvided by thse executin venues n which it places a significant reliance against ther executin venues in the market; and when executing rders in OTC prducts, including bespke prducts, checking the fairness f prices prpsed t clients by gathering market data used in the estimatin f the price f such prducts and, where pssible, by cmparing with similar t cmparable prducts. TP will review its rder executin arrangements and this Plicy at least annually r whenever a material change ccurs that affects its ability t cntinue t btain the best pssible result fr the executin f client rders n a cnsistent basis using the venues included in this Plicy. 8 TP will ntify yu f any material changes t its rder executin arrangements r this Plicy as described abve by psting the infrmatin n TP s website. N Fiduciary Relatinship TP s cmmitment t prvide yu with best executin des nt mean that it wes yu any fiduciary respnsibilities ver and abve the specific regulatry bligatins placed upn it r as may be therwise cntracted between TP and yurself. Yu remain respnsible fr yur wn investment decisins and TP will nt be respnsible fr any market trading lss yu suffer as a result f thse decisins. 8 Article 66(1) f DA2.
ANNEX 1: FINANCIAL INSTRUMENTS AS DEFINED BY MIFID II 1. Transferable securities 2. Mney-market instruments; 3. Units in cllective investment undertakings; 4. Optins, futures, swaps, frward rate agreements and any ther derivative cntracts relating t securities, currencies, interest rates r yields, emissin allwances r ther derivatives instruments, financial indices r financial measures which may be settled physically r in cash; 5. Optins, futures, swaps, frwards and any ther derivative cntracts relating t cmmdities that must be settled in cash r may be settled in cash at the ptin f ne f the parties ther than by reasn f default r ther terminatin event; 6. Optins, futures, swaps, and any ther derivative cntract relating t cmmdities that can be physically settled prvided that they are traded n a regulated market, a MTF, r an OTF, except fr whlesale energy prducts traded n an OTF that must be physically settled; 7. Optins, futures, swaps, frwards and any ther derivative cntracts relating t cmmdities, that can be physically settled nt therwise mentined in 6 and nt being fr cmmercial purpses, which have the characteristics f ther derivative financial instruments; 8. Derivative instruments fr the transfer f credit risk; 9. Financial cntracts fr differences; 10. Optins, futures, swaps, frward rate agreements and any ther derivative cntracts relating t climatic variables, freight rates r inflatin rates r ther fficial ecnmic statistics that must be settled in cash r may be settled in cash at the ptin f ne f the parties ther than by reasn f a default r ther terminatin event, as well as any ther derivative cntracts relating t assets, rights, bligatins, indices and measures nt therwise mentined in this Sectin, which have the characteristics f ther derivative financial instruments, having regard t whether, inter alia, they are traded n a regulated market, OTF, r an MTF; and 11. Emissin allwances cnsisting f any units recgnised fr cmpliance with the requirements f Directive 2003/87/EC (Emissins Trading Scheme).
ANNEX 2 9 - USE OF DISCRETION BY TP IN RELATION TO OTF BUSINESS Pursuant t Article 20(6) f MiFID II, executin f rders in an OTF will be carried ut n a discretinary basis by the peratr f the OTF. When carrying n OTF business, TP uses a cmbinatin f rder level and executin level discretin; namely: (a) (b) when deciding t place an rder int r retract an rder frm the OTF (Order Level Discretin); and/r when deciding nt t match a specific client rder with ther ppsite rders available n the systems at a given time (Executin Level Discretin). The discretin exercised in respect f OTF business will be cnducted in accrdance with the best executin requirements under MiFID II, when they apply, and as set ut in this Plicy. The OTF supprts varius trading systems 10 thrugh which rders r indicatins f interest (Trading Interests) can be submitted by venue users r brkers n behalf f venue users and where they can interact with ther Trading Interests (as part f the matching and executin prcess). The nature f the discretin exercised will depend n the cmbinatin f trading systems used fr a particular market segment (r sub-segment). In particular, each f the specific trading systems will enable the relevant brker t exercise discretin in different ways. Order Level Discretin Order Level Discretin may be exercised by brkers that sit within the OTF (Executing Brkers). The peratr f the OTF will have exercised Order Level Discretin in respect f Trading Interests whenever they have been placed in the OTF by an Executing Brker r remved frm the OTF by an Executing Brker. The peratr f the OTF may establish parameters fr trading by users f the OTF, which take accunt f the characteristics f the users and the market segment, which may be applied by the systems f the OTF t accept r reject Trading Interests. Trading Interests that are rejected will be reviewed by an Executing Brker r a persn acting under their supervisin. If an Executing Brker determines at any time that a Trading Interest that has already been placed in the OTF (thrugh any f the trading systems) shuld be remved, having regard t any applicable best executin requirements under MiFID II and as set ut in this Plicy, the Executing Brker will have discretin t reject that Trading Interest entirely r t remve the Trading Interest and, where applicable, t send it t anther executin venue. The availability f ther executin venues will vary accrding t the prduct being traded and the extent f external liquidity, as well as any applicable best executin requirements under MiFID II and as set ut in this Plicy. 9 Article 20(8) f MiFID II and ESMA Q&A. 10 E.g. a system fllwing ne r mre f the methdlgies which are described in MiFID II (Annex 1, RTS 2).
An Executing Brker may remve a Trading Interest frm the OTF if, fr example, the Executing Brker is aware that the venue user des nt wish t be expsed t particular psitins under certain market cnditins. If such market cnditins ccur, the Executing Brker may remve that venue user s Trading Interests frm the OTF. As anther example, if the speed f executin is a pririty fr a Trading Interest and there is greater liquidity at anther venue available t the Executing Brker, the Executing Brker may remve a venue user s Trading Interest frm the OTF and submit it t that ther executin venue, imprving the likelihd f executin. If an Executing Brker rejects r remves a Trading Interest frm the OTF, then it may be executed in accrdance with any f the methds set ut in this Plicy. Executin Level Discretin Executin Level Discretin may be exercised by Executing Brkers by determining that an rder submitted t the OTF and matched with an ppsing rder in the OTF shuld nt be executed against that ther rder. The Executing Brker will have regard t any applicable best executin requirements under MiFID II and as set ut in this Plicy. The factrs that are relevant are thse derived frm any applicable best executin requirements under MiFID II and as set ut in this Plicy. An example f the exercise f Executin Level Discretin in the OTF may include the determinatin that an rder culd be executed at a better price if it were t be brken int child rders.
ANNEX 3 CREDIT PRODUCTS Credit prducts include (i) credit derivatives and (ii) crprate bnds and securitised debt instruments. 1. Executin Venues 11 TP trades credit prducts n the fllwing executin venues: TP Executin Venues Tullett Prebn (Eurpe) OTF Tullett Prebn (Institutinal Services) OTF Tullett Prebn (Securities) OTF Tullett Prebn (Eurpe) MTF Tullett Prebn (Securities) MTF Third Party Executin Venues ICAP WCLK MTF 2. Weighting f Executin Factrs 12 Fr Credit prducts, the fllwing Executin Factrs are given greater weight in descending imprtance as fllws: Price; Time pririty; Size; Speed; Likelihd f executin; and Cunterparty credit limit. In illiquid markets, likelihd f executin and rder size will have a strnger weighting. Csts f executin is nt an imprtant Executin Factr fr Crprate Bnds & Securitised Debt prducts. 3. Factrs used t select Executin Venues 13 Fr credit prducts, the sle factr used t select an executin venue will be client instructin. Orders in Credit prducts will either be received directly int a TP OTF (and cnsequently arranged and executed by the OTF peratr), r received by TP as Investment Firm fr the purpses f being registered nt a TP MTF. 11 Article 66(3)(b) f DA2. 12 Articles 64(1) and 66(3) (a) and (d) f DA2. 13 Article 66(3)(c) f DA2.
4. Executin utside a trading venue 14 TP will nt execute Credit prducts utside f a trading venue (acting as an executin venue r trade registratin venue). 14 A&O Nte: See Article 66(3)(e) f DA2.
ANNEX 4 - EQUITIES Equities prducts include (i) cash equities and (ii) equity derivatives. 1. Executin Venues 15 TP has access t and places significant reliance n the fllwing executin venues: TP Executin Venues Third Party Executin Venues Tullett Prebn (Securities) OTF tpsef Athens Stck Exchange Australian Stck Exchange Belgian Stck Exchange Budapest Stck Exchange Cpenhagen Stck Exchange Deutsche Brse - Xetra Eurex Futures and Optins EurNext Amsterdam EurNext Paris Futures and Optins Hng Kng Stck Exchange ICAP WCLK MTF ICE Eurpe Futures and Optins Irish Stck Exchange (Xetra) Istanbul Stck Exchange Jhannesburg Stck Exchange Lisbn Stck Exchange LSE & LIO Madrid Stck Exchange Milan Stck Exchange Main Market (MTA) NYSE Osl Stck Exchange Prague Stck Exchange Singapre Stck Exchange Stckhlm Stck Exchange Swiss Exchange Tel Aviv Stck Exchange Tky Stck Exchange Trnt Stck Exchange Vienna Exchange (Xetra) Warsaw Stck Exchange 15 Article 66(3)(b) f DA2.
2. Weighting f Executin Factrs 16 The asset classes within Equities will determine the relative imprtance f the Executin Factrs, as fllws: Fr cash equities, the fllwing Executin Factrs are given greater weight in descending imprtance as fllws: Price; Liquidity; Size; and Csts f executin. Fr equity derivatives, the type f trading capacity will determine the relative imprtance f the Executin Factrs. These can be split int trade registratin and name give up (NGU) business. Fr registered trades, the Executin Factrs will likely be weighted in the fllwing descending rder f imprtance: Price; Time pririty; Speed; Size; and Likelihd f executin. Fr rders which are large in size, likelihd f executin will be given mre weight as it is mre difficult t get larger rders executed in the market. Csts f executin is nt a majr Executin Factr fr these prducts. 3. Factrs used t select Executin Venues 17 Fr cash equities, the factrs are used t select an executin venue are as fllws: DMA algrithm rules Where rders are placed in a DMA algrithm, the algrithm will determine n which executin venue t execute the rder, based n the rules f the algrithm. The trading venue where a prduct is listed 16 Articles 64(1) and 66(3) (a) and (d) f DA2. 17 Article 66(3)(c) f DA2.
Where an rder is placed directly nt a third party trading venue, the venue where the prduct is listed will determine the place f executin. Settlement type Fr sme equity prducts, the settlement type (e.g. cleared/nn-cleared) will determine the executin venue which can be used. Client Instructin Fr equity derivatives, the factrs used t select an executin venue will be: Where the prduct is listed: Where an rder is placed directly nt a third party venue, the venue where the prduct is listed will determine the place f executin. Where prducts are dual listed, the executin will take place n the venue with the mst liquidity (which may be a third cuntry trading venue), unless this venue is nt eligible under MiFID II rules. In such situatins, TP will execute trades n an EU trading venue r third cuntry trading venue that is eligible under MiFID II rules (which culd result in trades being executed n the venue with the least market liquidity). Fr certain transactins, the nature f the characteristics f the rder may determine that the executin venue is nt the venue with the mst liquidity due t the certainty f executin f multiple rders as a whle being given a higher executin factr. Client Instructin 4. Executin utside a trading venue 18 TP will nt execute any Equity prducts utside f a trading venue (acting as an executin venue r trade registratin venue). 18 Article 66(3)(e) f DA2.
ANNEX 5 - RATES 1. Executin Venues 19 TP has access t and places significant reliance n the fllwing executin venues: TP Executin Venues Third Party Executin Venues tpsef Tullett Prebn (Securities) OTF Tullett Prebn Institutinal Services OTF Tullett Prebn (Eurpe) OTF Tullett Prebn (Eurpe) MTF ICE/LIFFE Eurex iswap MTF (EUR & GBP IRS nly) 2. Weighting f Executin Factrs 20 Fr Interest Rate Derivatives (IRD), the fllwing Executin Factrs are given greater weight in descending imprtance as fllws: Price; Size; Whether the trade is required t be traded n/ff SEF Sme cunterparties will nt wish t r be registered t execute n a SEF and cnsequently the liquidity pl culd be reduced CCP (fr cleared prducts nly) It is market cnventin fr trades t be cleared at LCH Clearnet. Fr sme markets, ther CCP s are active but have a small market share. Therefre, if a client instructs TP t use a CCP ther than LCH Clearnet, this Executin Factr will be given greater weight. Likelihd f executin and settlement. Csts f executin, Speed f Executin and type f trading capacity are nt majr Executin Factrs fr these prducts. 3. Factrs used t select Executin Venues 21 Fr IRD, the factrs used t select an executin venue are as fllws: 19 Article 66(3)(b) f DA2. 20 Articles 64(1) and 66(3) (a) and (d) f DA2. 21 Article 66(3)(c) f DA2.
Type f prduct traded Nt all prducts will be listed and available t trade n all venues. Client permissins/ability t trade Orders will nly be able t be executed by TP n venues where the client is permissined t trade. This factr is prevalent fr trades which are required t be executed n a SEF platfrm. Client Instructin Orders in IRD will either be received directly int the TP OTFs (and cnsequently arranged and executed by a TP OTF peratr) r received by TP as an Investment Firm fr the purpses f being registered nt a TP MTF. 4. Executin utside a trading venue 22 TP will nt execute rders in Rates prducts utside f a trading venue (acting as an executin venue r trade registratin venue). 22 Article 66(3)(e) f DA2.
ANNEX 6 GOVERNMENT BONDS AND REPOS 1. Executin Venues 23 TP has access t and places significant reliance n the fllwing executin venues: TP Executin Venues Third Party Executin Venues Tullett Prebn (Securities) OTF Tullett Prebn Institutinal Services OTF Tullett Prebn (Eurpe) OTF Tullett Prebn (Securities) MTF Tullett Prebn (Eurpe) MTF Eurex ICE 2. Weighting f Executin Factrs 24 Fr Gvernment Bnds, the fllwing Executin Factrs are given greater weight in descending imprtance: Price; Time pririty; Size; Speed and likelihd f executin; Cunterparty credit limit; In illiquid markets, likelihd f executin and rder size will have a strnger weighting. In name give-up markets, cunterparty credit limit culd be the mst imprtant Executin Factr. Cst f executin is nt a majr Executin Factr fr these prducts. Fr Reps, the fllwing Executin Factrs are given greater weight in descending imprtance: Cunterparty credit limit; Price; Time pririty; 23 Article 66(3)(b) f DA2. 24 Articles 64(1) and 66(3) (a) and (d) f DA2.
Size; Speed f executin; Likelihd f executin; In illiquid markets likelihd f executin and size will be given a strnger weighting. Cst f executin is nt a majr Executin Factr fr these prducts. In illiquid markets, likelihd f executin and rder size will have a strnger weighting. 3. Factrs used t select Executin Venues 25 Fr Gvernment Bnds and Reps, the sle factr used t select an executin venue will be client instructin. Orders in Gvernment Bnds and Reps will either be received directly int the TP OTFs (and cnsequently arranged and executed by a TP OTF peratr) r received by TP as an Investment Firm fr the purpses f being registered nt a TP MTF. 4. Executin utside a trading venue 26 TP will nt execute rders in Gvernment Bnds and Reps utside f a trading venue (acting as an executin venue r trade registratin venue). 25 Article 66(3)(c) f DA2. 26 Article 66(3)(e) f DA2.
ANNEX 7 - COMMODITIES 1. Executin Venues 27 TP has access t and places significant reliance n the fllwing executin venues: TP Executin Venues Third Party Executin Venues Tullett Prebn (Eurpe) OTF Chicag Bard f Trade (CBOT) Tullett Prebn (Eurpe) MTF Chicag Mercantile Exchange (CME) Eurnext Eurpean Energy Exchange (EEX) Iberian Energy Derivatives Exchange (OMIP) ICE ICE Endex Lndn Metal Exchange (LME) NASDAQ Pegas Singapre Exchange (SGX) Spanish Futures & Optins Exchange (MEFF) 2. Weighting f Executin Factrs 28 Fr Cmmdities, the type f trading capacity will determine the relative imprtance f the Executin Factrs. These can be split in the cmmdity markets int trade registratin and name give-up (NGU) business: Fr trade registratin markets, the Executin Factrs will typically be weighted in the fllwing rder f descending imprtance: Price; Likelihd f executin; Size; Speed f executin Althugh factrs specific t the client r rder may take precedence and change the relative imprtance f the general Executin Factrs. 27 Article 66(3)(b) f DA2. 28 Articles 64(1) and 66(3) (a) and (d) f DA2.
Fr registered trades, credit wrthiness f cunterparties, cst f executin and settlement will nt be relevant Executin Factrs. Fr NGU markets, the Executin Factrs will typically be weighted in the fllwing rder f descending imprtance: Price Credit wrthiness and the ability t trade with ther cunterparties; Likelihd f executin: Size; Speed f Executin Althugh factrs specific t the client r rder may take precedence and change the relative imprtance f the general Executin Factrs. Fr NGU markets, cst f executin and settlement f trades will nt be relevant Executin Factrs. 3. Factrs used t select Executin Venues 29 Fr Cmmdities, the factrs used t select an executin venue are as fllws: Type f Cmmdity cntract traded Certain cmmdity cntracts nly clear at certain venues). In such circumstances, the executin venue will be prescribed; TP will nt select the executin venue. This will be particularly prevalent fr trade registratin business. Client instructin/ability t trade n executin venues Fr trade registratin business, TP is nly able t register trades nt venues t which the client(s) have the ability t trade. Fr NGU business, all activity in MiFID II financial instruments relating t cmmdities will be carried ut n the Tullett Prebn (Eurpe) OTF. 4. Executin utside a trading venue 30 Whilst transactins in cmmdities are predminantly executed n a trading venue, spt and sme physically-settled instruments (nt classified as financial instruments under MiFID II) will be executed ff venue. 29 Article 66(3)(c) f DA2. 30 Article 66(3)(e) f DA2.
ANNEX 8 MONEY MARKETS AND FX PRODUCTS 1. Executin Venues 31 TP has access t and places significant reliance n the fllwing executin venues: TP Executin Venues Third Party Executin Venues Tullett Prebn (Securities) MTF Tullett Prebn (Securities) OTF Tullett Prebn (Eurpe) OTF Tullett Prebn (Eurpe) MTF tpsef N/A 2. Weighting f Executin Factrs 32 The asset classes within MM & FX will determine the relative imprtance f the Executin Factrs, as fllws: Fr FX Optins, the Executin Factrs are weighted in the fllwing descending rder f imprtance: Price; Time; Size; and Likelihd f executin and settlement. Fr G10 FX prducts, the Executin Factrs will likely be weighted in the fllwing descending rder f imprtance: Price; Time; Size; Executin instructin (all r nthing); Likelihd f executin; Credit wrthiness / limits available between cunterparties; and 31 Article 66(3)(b) f DA2. 32 Articles 64(1) and 66(3) (a) and (d) f DA2.
Csts f executin. Fr rders which are large in size, likelihd f executin will be assigned mre weight. Fr emerging markets (EM) FX prducts, price, likelihd f executin and client credit wrthiness will be weighted mre equally than fr G10 FX prducts. Fr nn-deliverable frward (NDF) prducts, the Executin Factrs will likely be weighted in the fllwing descending rder f imprtance: Price; Time; Size; Executin venue (e.g. client preference r requirement t trade n SEF r ff SEF) Likelihd f executin Credit wrthiness/limits available between cunterparties; and Csts f Executin Fr MM prducts, the Executin Factrs will likely be weighted in the fllwing descending rder f imprtance: Price and likelihd f executin are f equal imprtance (likelihd f executin will be given greater weight fr NGU business); Client s preferred executin methd (i.e. matched principal r name give up) Credit wrthiness f clients; Size; Speed; and Csts f executin. 3. Factrs used t select Executin Venues 33 The factrs used t select an executin venue are as fllws: Type f prduct traded Nt all prducts will be listed and available t trade n all venues. Client permissins/ability t trade 33 Article 66(3)(c) f DA2.
Trades will nly be able t be executed by n venues where the client r TP is permissined t trade. This factr is prevalent fr trades which are required t be executed n a SEF platfrm. Client Instructin 4. Executin utside a trading venue 34 Save as prvided belw, TP will nt execute any trades in Mney Market and FX prducts utside f a trading venue (acting as an executin venue r trade registratin venue). TP brkers (including Executing Brkers) have access t liquidity n a glbal basis. If a Trading Interest is matched and executed against an ppsite Trading Interest in a third cuntry that des nt require the executin t take place n a regulated trading venue, and the rules t which the TP brker is subject d nt require that all transactins invlving the relevant financial instrument are executed n a regulated trading venue (e.g., the MiFID II trading bligatin), then the TP brker may interact with a cunterparty r intermediary in that third cuntry t execute the trade, subject t any restrictins r limitatins under applicable law. 34 Article 66(3)(e) f DA2.