Systematic internalisers must publish firm quotes for liquid instruments, in accordance with the transparency obligations set out by MiFID II. This obligation reflects their role as counterparty and their need to provide accessible prices to clients. They may also limit access to their quotes to certain categories of clients.

To identify a systematic internaliser, two sets of quantitative criteria must be verified: the frequent and systematic nature, measured by the number of OTC transactions carried out on own account, and the substantial nature, measured by the size of this activity relative to the provider's total activity or to the EU total for the instrument concerned. A firm may also voluntarily opt for this status by notifying the AMF, as BNP Paribas did in 2018.

Systematic internalisers are defined in Article L.533-32 of the Code monétaire et financier, which transposes the criteria defined in Article 4(1)(20) of MiFID II. This article specifies the quantitative and qualitative conditions for an investment firm to be considered a systematic internaliser.

The main distinction lies in the multilateral nature of the market operator, where many buyers and sellers interact simultaneously without the operator acting as counterparty, unlike the systematic internaliser which always acts as counterparty to its clients' transactions. Under Article 4(1)(21) of MiFID II, a market operator runs a multilateral system with non-discretionary rules, while a systematic internaliser (Article 4(1)(20)) trades in an organised and frequent manner on own account outside any multilateral system.

Market operators are characterised by a multilateral system and non-discretionary rules, while systematic internalisers act as counterparty and have discretionary power over execution. These distinctions are essential for understanding their respective roles in financial markets.

Under Article 4(1)(21) of MiFID II, a market operator is a legal entity that manages and operates a regulated market. It operates a multilateral system where many buyers and sellers interact simultaneously, with non-discretionary rules. Example: Euronext Paris SA.

Yes, a systematic internaliser may legitimately refuse certain transactions according to an objective and non-discriminatory commercial policy. This ability derives from its role as counterparty and the discretionary power it holds over order execution, unlike a market operator which must apply fixed rules.

A market operator cannot reject an order without justification because it operates according to non-discretionary rules. Execution rules are fixed and approved by the AMF, meaning the market operator has no discretion over order processing. A systematic internaliser, by contrast, may refuse certain transactions according to an objective and non-discriminatory commercial policy.