The regulator aims to significantly reduce the administrative burden of the regime.
By Rob Moulton, Becky Critchley, and Charlotte Collins
On 21 November 2025, the FCA published a Consultation Paper (CP25/32) on changes to the transaction reporting regime under UK MiFID, following the commitment by HM Treasury to make the transaction reporting regime more proportionate, streamlined, and agile in the FCA’s Handbook. Headline proposals include reducing the back reporting period for when firms are expected to resubmit incorrect reports, limiting the scope of the transaction reporting regime to financial instruments tradeable on UK trading venues only, and reducing the number of transaction reporting fields. The changes align with the general drive to reduce the administrative burden of regulation on firms, in line with the government’s growth agenda.
The FCA previously invited feedback on its views on how to reform the regime in its November 2024 Discussion Paper (see this Latham blog post). The regulator indicates that key themes emerging from the feedback related to the need for alignment with other reporting regimes, problem areas for firms, and new technologies.
As well as proposing a number of adjustments to the transaction reporting regime, the FCA intends to offer clarity on certain aspects of the regime. The FCA considers that efforts to streamline transaction reporting requirements will improve the quality of data firms submit, resulting in a greater proportion of complete, accurate, and timely transaction reports. The regulator emphasises that it has assessed the proportionality of every aspect of the regime in formulating its proposals, and estimates that these changes would bring annual savings of over £100 million for firms. However, many firms expended significant cost and resources in creating systems and processes to comply with the current regime, so the short-term pain of further regulatory change may weigh heavily against the longer-term cost benefits.
Link to Key Proposals Key Proposals
The FCA presents a large number of proposed changes relating to the overall regime, its scope, the content of transaction reports, and obligations on trading venues. We summarise some of the key proposals below.
- Back reporting: The FCA proposes to reduce the default back reporting period from five to three years. It estimates that this would lower the number of transaction reports that need to be resubmitted by a third. However, it would retain the ability to require back reporting on an ad hoc basis for up to five years (in relation to serious reporting failings) and firms would still be required to keep transaction records for five years. The FCA does not propose to introduce a new “amend” function to correct historic transaction reports at this stage.
- Geographic scope: The FCA proposes to limit the scope of the transaction reporting regime to financial instruments tradeable on UK trading venues only. The FCA estimates that this would remove reporting obligations for around 6 million financial instruments which are only tradable on EU trading venues. However, it notes that firms would still need to continue to submit Suspicious Transaction and Order Reports under the UK Market Abuse Regulation (UK MAR) for instruments that are admitted to trading or traded on EU trading venues. The FCA highlights that its market abuse enquiries primarily focus on UK markets, which raises the question of whether it might similarly limit the scope of UK MAR when it reviews that regime in due course.
- FX derivatives: In response to issues raised concerning challenges in submitting complete and accurate transaction reports for FX derivatives, the FCA is considering removing FX derivatives from the scope of the UK transaction reporting regime. Notably, it does not believe this would hinder its ability to police markets, although it states that more ad hoc data requests may be needed in order to address the gap in oversight.
- Reporting fields: The FCA proposes to amend some fields and remove others, to make reporting more efficient. This would reduce the number of transaction reporting fields by 13, from 65 to 52. It is sensibly not taking forward proposals mooted in the Discussion Paper to require personal information for individuals responsible for making investment and execution decisions within a firm, or introduce a new aggregate client linking code. Suggested changes include:
- The trading venue transaction identification code (TVTIC) would only need to be reported for transactions executed on UK trading venues.
- Branches would need to be identified with the Legal Entity Identifier of their head office or registered office.
- More flexibility would be granted in how trusts are identified in transaction reports.
- Firms would need to obtain national identifiers for natural persons before a service is provided.
- Firms would need to report the segment Market Identifier Code of the trading venue in the buyer and seller fields for all trading scenarios where the firm does not know the counterparty at the point of execution.
- The concept of a complex trade would be replaced with the concept of a package transaction.
- There would be a new reporting value to indicate where a firm is providing direct electronic access.
- The country of the branch for the buyer/seller fields would be replaced with a new client indicator field.
- A number of indicator fields would be removed.
- Reporting by trading venues: The FCA would require trading venues to populate fewer fields in their transaction reports, to make the rules more proportionate. However, the FCA is not proposing to disapply the requirement to report underlying client details, as it considers this would create an unacceptable loss of oversight.
- Instrument reference data fields: The FCA proposes to reduce the number of fields from 48 to 37. However, it would also clarify that instrument reference data should be updated when the reported values change.
- Submission of instrument reference data: The FCA proposes that trading venues would only need to submit instrument reference data the first time there is a reportable event, plus for any subsequent changes. It also suggests removing the obligation for systematic internalisers to submit instrument reference data.
- TOTV: In light of the difficulties in applying the “traded on a trading venue” (TOTV) concept to derivatives, the FCA is proposing to provide new Handbook guidance on what constitutes a reportable instrument, so that firms would no longer need to have regard to ESMA’s TOTV opinion.
- Index derivatives: The FCA proposes to allow firms to “over-report” where the cost of determining the reportability of index derivatives may be greater than the cost of reporting the relevant transactions. It also plans to provide guidance on how to populate the underlying index name in the new transaction reporting user pack.
- OTC derivative identifiers: Acknowledging the difficulties in moving to a different approach for OTC ISINs, the FCA is to retain the OTC ISIN. However, it will keep this under review as it considers the longer-term approach to reporting obligations.
- Conditional single-sided reporting: While the FCA provides various reasons for not wanting to remove buy-side reporting entirely, it is proposing to enable more use of conditional single-sided reporting under Article 4 of RTS 22, which has currently not been widely used. It proposes to update and streamline the existing transmission mechanism and allow conditional single-sided reporting to take place in all trading capacities (not just firms receiving and transmitting orders). This would include reducing the volume of information that must be submitted to the receiving firm, from 10 data points to four.
- Exclusions: The FCA proposes to expand and streamline existing exclusions. For example, it would exclude corporate events and actions, regardless of whether an investment decision was made. It would also exclude the creation or redemption of units in a collective investment undertaking, regardless of whether it takes place directly with a manager or administrator. Firms would still have to report IPOs, secondary public offerings or placings, and debt issuances, and they could choose to report other corporate actions if this is less costly than excluding reporting. In addition, the FCA will incorporate existing ESMA guidance on exclusions into the Handbook.
- Clarifications: The FCA proposes to copy parts of existing ESMA guidance into the Handbook, to clarify reporting requirements, and provide a new transaction reporting user pack (which the FCA will consult on in 2026) to help firms understand their reporting obligations, as well as expectations in relation to systems and controls. Clarifications relate to topics such as the meaning of “transaction” and “execution of a transaction”, and when a branch has executed a transaction.
The FCA has concluded that it would not be proportionate to apply transaction reporting obligations to AIFMs and UCITS managers with MiFID top-up permissions (as suggested in the Discussion Paper). It has also decided that it will not propose to require trading venues to report all transactions executed on their venues by third-country investment firms, irrespective of whether a UK branch was involved.
As part of the changes, the FCA will restate the UK versions of RTS 22, 23, and 24 in its Market Conduct Sourcebook, and will also replicate various bits of ESMA guidance in the Handbook. Aside from these Handbook changes, the FCA is also planning to improve the usefulness and accessibility of FCA FIRDS, and to allow firms to treat it as a “golden source” of data for determining whether a transaction is reportable.
Link to Long-Term Vision Long-Term Vision
The FCA also uses the paper to announce a longer-term strategic plan to streamline transaction reporting requirements across multiple regimes, including requirements in the UK European Market Infrastructure Regulation (EMIR) and the UK Securities Financing Transactions Regulation (SFTR).
The FCA signals that it will consult in future, alongside the Bank of England, on how to achieve this goal. Any proposals will focus on reducing duplication, harmonising requirements, and ensuring proportionality, while maintaining the existing reporting structure under UK MiFIR, EMIR, and the SFTR. The regulator indicates that it will not propose moving to a single-template reporting regime, as the groundwork conducted so far indicates that such a major restructure would not be proportionate. The FCA states that it is mindful of keeping regulatory change costs to a minimum.
It intends to set up a working group for this initiative, details of which will become available in Q1 2026.
Link to Next Steps Next Steps
Responses to the consultation are requested by 20 February 2026. The FCA plans to publish final rules in the second half of 2026 and expects to set an implementation period of around 18 months. It will issue a further consultation on transitional provisions and consequential amendments at a later date.
Firms need to be prepared for these significant changes coming down the pipeline, and start to plan for how they would handle implementation. While the FCA has clearly thought hard about how to reduce the burden of the regime and the future cost savings this will bring for firms, any changes will be time-consuming and costly to implement in the short term. Firms will also be mindful that transaction reporting failings are a key enforcement area for the regulator, and introducing changes will bring increased risk that firms make errors while changes are implemented.
Lastly, a divergence from the EU MiFID transaction reporting regime will prevent firms from taking a single approach across the UK and EU, although the FCA states that more firms reported that they already operate separate reporting systems. This will bring added implementation costs for those firms that do need to implement separate systems.