ESMA Opens Equity-Market Structure Review as Lit Trading Share Slips

ESMA has launched a call for evidence on the structure of European equity markets, using MiFIR transaction-reporting data to map how trading evolved between 2022 and 2025. In its April 30 announcement, the regulator said markets are still functioning well overall, with addressable liquidity stable at about 85% of total trading volume and on-book trading holding around 75% to 80%.

The notable shift is inside that mix. ESMA said lit continuous trading declined over the period, while activity increased in closing auctions, frequent batch auctions, and systematic internaliser trading. The paper also asks for feedback on how addressable liquidity should be treated under RTS 1 and whether post-trade transparency flagging may need adjustment.

Alongside the consultation, ESMA said it is repealing the Q&A that had clarified that periodic auctions are subject to the tick-size regime. Stakeholder responses are due by 30 June 2026, with a feedback statement planned in the second half of the year.

Why it matters

This is directly relevant to traders because it goes to where price formation happens, how much liquidity is visible, and which trading mechanisms may become more attractive as rules evolve. Any later changes to transparency flags, SI treatment, or auction-related rules could affect execution quality and venue choice across European stocks.

What to watch next

Watch the consultation feedback, especially from exchanges, brokers, and buy-side firms on transparency and auction trading. If ESMA sees strong evidence that trading is fragmenting in ways that weaken price discovery, follow-up technical rule changes could land later in 2026.