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ARTICLE · 15 APRIL 2026

Algorithmic Trading And Artificial Intelligence – ESMA Supervisory Briefing

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On 26 February 2026, the European Securities and Markets Authority (ESMA) published a supervisory briefing to aid national competent authorities (NCAs) with their supervision of algorithmic trading in the EU...

AfghanistanFinance and Banking
Will Sykes
Will Sykes
Edward Karsten
Edward Karsten

On 26 February 2026, the European Securities and Markets Authority (ESMA) published a supervisory briefing to aid national competent authorities (NCAs) with their supervision of algorithmic trading in the EU under the Markets in Financial Instruments Directive II (MiFID II). 

In particular, investment firms engaged in algorithmic trading must ensure that their algorithms, algorithmic trading systems or algorithmic trading strategies are tested to avoid contributing to disorderly markets or facilitating abusive practices. Importantly, ESMA has taken a broad interpretation of what constitutes algorithmic trading.

In the briefing, ESMA also outlines the relevance of artificial intelligence (AI) to algorithmic trading and associated compliance with EU rules. Despite the lack of explicit reference to AI in MiFID II and in Commission Delegated Regulation (EU) 2017/589 (RTS 6), there is an expectation that investment firms should consider the influence of AI on their trading algorithms as

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