On March 1, MFA submitted a letter in support of the SEC’s proposal to apply Regulation ATS (alternative trading systems) on ATSs that trade government securities – a recommendation MFA made to the SEC in 2016. In our letter, we urged the Commission to examine other electronic trading venues that operate in the government securities markets and the fixed income markets overall. In particular, we noted that certain trading venues that utilize request-for-quote or streaming quote protocols in the cash Treasury market resemble multiple-to-multiple markets and have significant volume traded on them. While electronic trading systems broadly should not be captured as ATSs, the Commission should consider how similarly situated entities might be treated in a more similar manner to improve the efficiency and resiliency of trading in government securities. We recommended that the Commission examine and review the oversight framework of certain government securities trading venues not covered by the proposed amendments to Regulation ATS for Government Securities ATSs. Finally, MFA welcomed the Commission’s examination and review of important issues raised in the concept release for the trading of corporate debt and municipal securities, including the oversight of corporate bond and municipal securities electronic trading venues, and industry standards for reporting “electronic trade volumes.”
