EURONEXT_Registration_Document_2017

PRESENTATION OF THE GROUP

Regulation

1.4 Regulation

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1.4.1 OVERVIEW Euronext is an organisation that provides exchange listing, trading, post-trade and related services in Europe. The Company operates exchanges in five European countries. Each of the European exchanges and/or its respective operator holds an exchange licence granted by the relevant national exchange regulatory authority and operates under its supervision. Each market operator is subject to national laws and regulations and other regulatory requirements imposed by exchange authorities, central banks and finance ministries as appropriate. The five national regulatory authorities coordinate their regulation and supervision of the regulated markets operated by the Euronext group through the “Euronext College of Regulators”, acting pursuant to memoranda of understanding which Euronext has committed to respect. EUROPEAN REGULATION The regulatory framework in which Euronext operates is substantially influenced and governed by European directives and regulations in the financial services area, many of which have been adopted pursuant to the Financial Services Action Plan, which was adopted by the European Union in 1999 to create a single market for financial services. This has enabled and increased the degree of harmonisation of the regulatory regime for financial services, public offers, listing and trading, amongst other activities. Markets and Trading There are currently two key pieces of European legislation that govern the fair and orderly operation of markets and trading: the Markets in Financial Instruments Directive (“MiFID”) and, the MAR/ MAD II (as defined below) framework which replaced the Market Abuse Directive (“MAD I”). The European legislator has completed an overhaul of the MiFID framework: MiFID II/MiFIR with a market application date of 3 January 2018. MiFID Framework MiFID I MiFID I came into effect on 1 November 2007 and was designed to enhance the single market for financial services by harmonising the Member States’ rules on authorisation of investment firms, conduct of business, operation of trading venues and other related activities. The scope was limited to shares only. MiFID II/MiFIR MiFID II/MiFIR was adopted by the European Parliament on 15 April 2014 and by the Council on 13 May 2014 and entered into force on 2 July 2014. EU Member States are required to implement MiFID II in their national legislation within 24 months of the entry into force ( i.e . June 2016 postponed by one year to June 2017). While MiFID II/ MiFIR was due to apply in the markets from January 2017, the application was postponed to 3 January 2018. 1.4.2

From an Exchange perspective, the revised framework includes the following important elements:  a review of the equities’ trading and transparency framework to take into account evolutions in market structure as a result of MiFID I, leading to:  caps on dark trading on MiFID venues together with revised waivers from transparency,  requirement for shares to be traded on MiFID venues (with appropriate exemptions),  framework for the emergence of competing consolidated tape providers and potentially cost base disclosure with price regulation for the provision of market data by venues;  introduction of transparency in the non-equities space, leading to:  the creation of a new trading venue – organised trading facility (“OTF”),  the completion of the implementation of the G20 obligation in the European Union with a requirement to trade standardised OTC derivatives on MiFID venues ( i.e . deemed clearing eligible under EMIR and meeting MiFIR’s qualifying conditions for the trading mandate),  a generalised extension of pre – and post – trade transparency requirements to non-equities, subject to there being a liquid market and with provision for relevant waivers;  introduction of a system of position limits and reporting in respect of commodity derivatives;  introduction of trading venue – CCP open access provisions to facilitate further competition;  new and strengthened provisions in respect of market microstructure, including:  authorisation and regulation of HFT market participants, with specific focus on the nature of the market making agreements to be adopted with trading venues,  a broad range of new provisions to implement existing ESMA Guidelines on trading venues’ requirements in respect of market microstructure. MAR Framework MAR/MAD II The MAR/MAD II framework includes the Market Abuse Regulation (“MAR”) and a Directive on criminal sanctions for market abuse (“MAD II”) (both applicable since 3 July 2016). The new rules on market abuse, applicable to all trading venues, update and strengthen the framework to ensure market integrity and investor protection provided by the MAD I regime. MAR is designed to ensure regulation keeps pace with market developments such as the growth of new trading platforms, over the counter (“OTC”) trading and new technology such as high frequency trading (“HFT”). The new framework is also intended to strengthen the fight against market abuse across commodity and related derivative markets,  European harmonised tick size regime for Equities,

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2017 REGISTRATION DOCUMENT