- 1Spain: An attractive country for investment
- 2Setting up a business in Spain
- 3 Tax System
- 4 Investment aid and incentives in Spain
- 5 Labor and social security regulations
- 6 Intellectual property law
- 7Legal framework and tax implications of e-commerce in Spain
- AI Annex I Company and Commercial Law
- AIIAnnex II The Spanish financial system
- AIIIAnnex IIIAccounting and audit issues
- Financial institutions
- Safeguards to protect financial services customers
3.1 Securities Market
The Spanish securities market continues to see major growth, primarily due to harmonization with the markets of neighboring countries through the adoption of common European rules, and the introduction of new rules designed to streamline requirements and procedures in relation to public offerings and the admission to trading of securities on regulated secondary markets. Also, present-day securities market technical, operating and organizational systems allow for greater investment volumes. These factors have been resulting in greater transparency, liquidity and efficiency in Spanish markets.
The global financial crisis prompted large-scale volatility in stock prices, both at national and international level, associated with incipient but weak growth in the developed economies.
Spain’s basic securities market legislation is contained in Legislative Royal Decree 4/2015 of October 23, 2015 approving the revised Securities Market Law ("Securities Market Law"). This regulation has been amended in part by Legislative Royal Decree 11/2017 of June 23, 2017, the Legislative Royal Decree 9/2017 of May 26, 2017 and Legislative Royal Decree 21/2017 of December 29, 2017.
The key features of the Spanish securities market are as follows:
3.1.1 Spanish National Securities Market Commission:
The Spanish securities market regulations are based on the Anglo-Saxon model, focused on protecting small investors and the market itself. This was the aim behind the creation of the National Securities Market Commission (CNMV),18 which is the body responsible for supervision and inspection of the Spanish securities markets and for the activities of all who operate in them, overseeing market transparency, investor protection, and proper price formation.
The CNMV was created by Securities Market Law 24/1988, which has been adapted on an ongoing basis to the requirements of the European Union for the development of the Spanish securities markets in the European context.
Broadly speaking, its functions may be summarized as follows:
- Supervising and inspecting the Spanish securities market and the activity of all market players.
- Exercising sanctioning powers.
- Advising the Government on securities market-related matters.
- Legislative power (through circulars) for the proper functioning of the markets.
In the exercise of its powers, the CNMV receives a large amount of information, both from and about the market players, much of which is recorded in its official registers and is publicly accessible.
The CNMV’s activities are aimed primarily at companies that issue or make public offerings of securities, the secondary securities markets, investment firms and collective investment schemes. Regarding the latter and also the secondary securities markets, the CNMV performs prudential supervision to ensure the security of their transactions and the solvency of the system.
The CNMV, through the National Numbering Agency, also assigns the internationally-valid ISIN and CFI codes to all issues of securities made in Spain.
3.1.2 Primary market
The primary market means the set of rules and procedures applied to offerings of new securities and to public offerings of existing securities (OPS – public offering for subscription and OPV – public offering for sale).
Notwithstanding the freedom of issue, any issue or placement of securities requires among others, the registration of a prospectus that includes a summary of the operation, the content of which can vary depending on the type of operation19. The prospectus provides the investor with complete information on the issuer, its economic/financial position, the risks associated with the investment, and other details of interest to allow an informed investment decision to be made. The summary is a condensed version of the prospectus in terms more accessible to the unsophisticated investor.
One of the key primary market operations is the initial public offering (IPO), where one or more shareholders offer their shares to the public in general. There is no change in the capital stock, which simply changes owner (in whole or in part). In other words, no new shares are created in a secondary offering, but rather a certain number of existing shares are made available to the public in general.
3.1.3 Secondary market
Secondary markets are markets where existing securities are transferred by their holders to other investors.
Official secondary markets operate in accordance with established rules on conditions of access, admission to trading, operational procedures, reporting and disclosure. These rules provide assurance for the investor and compliance is overseen by the governing company of each market (which lays down the rules) and by the CNMV.
These rules aim to guarantee market transparency and integrity, focusing on aspects such as the correct disclosure of market-sensitive information (transactions performed or events which may affect the stock price, among others), correct price formation, and the monitoring of irregular conduct by market participants, such as the use of inside information.
The Spanish secondary markets are mainly the equity markets (stock exchanges), the fixed-income markets (public and private) and the futures and options markets.
The issuers, whose securities (whether equity or fixed-income) are listed on Spanish secondary markets, are primarily corporations and Spanish credit institutions, as well as foreign subsidiaries of Spanish companies. There are also foreign companies (European, mainly) whose shares are traded on Spanish stock exchanges.
In relation to the functioning of the regulated markets, 2002 saw the formation of Bolsas y Mercados Españoles, Sociedad Holding de Mercados y Sistemas Financieros, S.A. (BME).20 This was the response of the Spanish markets to a new international financial environment in which investors, intermediaries and companies demand a growing range of services and products within a secure, transparent, flexible and competitive framework. BME comprises the various companies responsible for directing and managing Spain’s securities markets and financial systems, including within a single group for the purposes of actions, decision-making and coordination, the following members:
- The Madrid, Barcelona, Valencia and Bilbao Stock Exchanges.21
- Sociedad de Bolsas, which is the company entrusted with the management and functioning of the Sistema de Interconexión Bursátil (SIBE), the electronic trading platform of the Spanish securities market.22
- The AIAF, Fixed-Income market, which is the financial bond (or fixed-income) market where securities issued by industrial companies, financial institutions and regional public bodies to raise funds to finance their activities are listed and traded.23
- Sociedad Rectora de Productos Derivados, S.A.U. (MEFF RV) and MEFF, Derivados de Renta Fija, S.A. (MEFF RF), responsible for the official Spanish futures and options market (equities and fixed-income securities, respectively).24
- SENAF, the Electronic System for the Trading of Financial Assets, which is an electronic platform where Spanish public debt securities are traded.25
- Sociedad de Gestión de los Sistemas de Registro, Compensación y Liquidación de Valores, S.A.U. (IBERCLEAR)26, which is the Spanish central securities depository, responsible for registering in the accounts and for clearing and settling securities admitted to trading on the Spanish stock exchanges, the Public Debt Book-Entry Market, the AIAF Fixed Income Market, and the Latibex (the Latin American Securities Market denominated in Euros). IBERCLEAR uses two technical platforms: the Securities Clearance and Settlement System (SCLV) and the Bank of Spain’s Public Debt Book-Entry Office (CADE). In the former, the securities traded on the stock market are settled, while in the latter, fixed income securities (public and private) are settled.
The BME Group is carrying out a reform of the system for clearing, settling and registering securities in Spain. The reform introduces three core changes which, in turn, generate numerous operating changes: (i) transfer to a balance-based registration system, (ii) introduction of a Central Counterparty Clearing House ("CCP") (BME CLEARING), and (iii) integration of the current CADE and SCLV into a single platform. The establishment of this new system is expected to take place in two successive phases: first phase (April 7, 2016), establishment of the CCP and move of SCLV (variable income) to the new system, and second phase (September 18, 2017), move of CADE (fixed income) to the new system and connection to T2S.
The main secondary markets in Spain are as follows:
|Type of market||Purpose||Supervision, clearing and settlement||Comments|
|Fixed Income||Public Debt Book-Entry Market||Trading of fixed-income securities represented by book entries issued both by national and supranational public bodies.||Bank of Spain; Iberclear.||
|AIAF||Trading of all kinds of private fixed-income securities, except for instruments convertible into shares.||CNMV; Iberclear.||
|Equity||Stock exchanges||Exclusively for trading of shares and securities which are convertible or which carry rights of acquisition or subscription.||CNMV; Iberclear.||
|Latibex||Trading of Latin American marketable securities with a price formation reference in European business hours.||CNMV; Iberclear.||
|Futures and options market||Spanish financial futures market (MEFF)||Trading of financial futures and options.||CNMV and Ministry of Finance; MEFF is in charge of clearing and settlement.||
A) Fixed Income
(i) Public Debt Book-Entry Market
The purpose of the Public Debt Book-Entry Market is to trade fixed-income securities represented by book entries issued both by national and supranational public bodies.
The Bank of Spain is responsible for supervision and management of the Public Debt Book-Entry Market through the Public Debt Book-Entry Office.
In contrast to the traditional telephone trading system, in 2001 and 2002 the creation of the Electronic System for the Trading of Financial Assets (SENAF) was authorized, and in 2002, that of the Organized System for the Trading of Fixed-Income Securities (MTS ESPAÑA SON) managed by Market for Treasury Securities Spain, S.A. (MTS ESPAÑA). Both are Organized Trading Systems supervised by the CNMV and the Bank of Spain.
The Public Debt Book-Entry Market is particularly important in Spain and attracts both resident and non-resident investors. The favorable tax treatment enjoyed by non-residents on investments in these securities makes it a particularly attractive market. There has been a sharp increase in debt held by non-residents since the introduction of the single currency. These investors hold mainly 10- or 15-year highly-liquid strippable bonds. They come chiefly from France, Germany and the United Kingdom; beyond the EU, the growing presence of Japanese and Chinese investors is particularly noteworthy.
Mention should also be made of the centralization of money market transactions through a book-entry system and the creation of the futures and options markets, linked to the book-entry system through which public debt securities are traded.
Iberclear is in charge of registering and settling transactions in securities admitted to trading on the Public Debt Book-Entry Market. Iberclear has links with the central securities depositories of Germany, France, Italy and the Netherlands, meaning that Spanish public debt securities can be traded in those countries. Meffclear, a central counterparty in Public Debt Book-Entry securities managed by MEFF RF, began its operations in 2004.
(ii) AIAF Fixed-Income Market
This is the market for trading of all kinds of private fixed-income securities (companies and private institutions), except for those instruments which are convertible into shares (which are only traded on stock exchanges), and public debt (traded through the Public Debt Book-Entry Market). It is an organized secondary market specialized in large-volume trading, meaning that it is geared towards wholesale investors (i.e. it caters primarily for qualified investors).
The AIAF market has grown rapidly in recent years owing to the expansion of fixed-income securities in Spain. It was formed in 1987, through an initiative of the Bank of Spain, aiming to put new mechanisms in place to encourage business innovations which could be carried out by raising funds through fixed-income assets. The regulatory and supervisory authorities have gradually provided it with the features required to be able to compete in its environment.
In recent years the AIAF market has grown in size and is now comparable with the fixed-income markets of other EU countries, with the special feature that it is one of the very few Official Organized Markets in Europe dedicated exclusively to private fixed-income securities.
Through the AIAF and in accordance with their fundraising strategies, issuers offer investors a variety of assets and products across the full range of maturities and financial structures.
Under the supervision of the CNMV, the AIAF market guarantees the transparency of transactions and foments the liquidity of assets admitted to trading.
The AIAF Fixed-Income Market currently has 56 members, including the leading banks, broker-dealers and brokers in the Spanish financial system. Transactions are cleared and settled through Iberclear.
(i) Stock exchanges
The Spanish stock exchanges (Madrid, Bilbao, Barcelona and Valencia) are the official secondary markets engaged in the exclusive trading of shares and securities which are convertible or which carry rights of acquisition or subscription. In practice, equity issuers also use the stock exchanges as a primary market for initial public offering (IPO) or capital increases.
The manner in which each stock exchange functions and is organized depends on the related stock exchange governing company.
There are currently two trading systems:
- The trading floor (i.e. the traditional system). Each of the four stock exchanges has its own trading floor. Under this system, the stock exchange members trade through an "electronic floor called a "pit" (which was the place in the stock exchange where securities were traditionally traded).
- The SIBE electronic trading platform is managed by Sociedad de Bolsas which connects up the four Spanish stock exchanges. It is an order-driven market, which offers real-time information on all stock price fluctuations and permits the issue of orders through computer terminals to a central computer. In this way, a single Market Order Book is managed for each security.
Practically all the share trading in Spain is made through the SIBE. All securities admitted to trading on at least two stock exchanges can, at the request of the issuer and subject to a favorable report by the Sociedad de Bolsas and the agreement of the CNMV, be traded through this system.
Stock market activity is measured in terms of performance indexes, based on share prices as the best indicator of market price. Thus the index shows price fluctuations and the market trend at different points in time.
The IBEX-35 is the benchmark index of the Spanish continuous market. It operates in real time and reflects the capitalization of the 35 most liquid companies traded on the electronic stock market, making it an essential information tool for brokers and dealers. The index is not subject to any kind of manipulation and the securities forming part of it are reviewed twice annually.
To be included in the index, certain guidelines must be observed, such as:
- The company must be traded on the continuous market for at least six months (control period).
- Companies with a market capitalization of less than 0.3% of the average capitalization of the IBEX-35 cannot be included.
- The security must have been traded in at least one third of the sessions in the six-month control period. If this is not the case, the security could still be chosen if it were within the top 15 securities by capitalization.
- Rules on the weighting of companies according to their free float must be observed.
The following chart shows the variations in this index in the past year.
Source: Bolsa de Madrid (www.bolsamadrid.es)
(ii) Latibex Market
The Market for Latin American Securities in Euros ("Latibex") came into operation at the end of 1999. This market was formed to provide Latin American listed companies with a price formation reference in European business hours, supported by the key role played by the Spanish economy in Latin America. This market uses the SIBE as its trading platform.
Latibex is not classed as an official secondary market, although it operates in a very similar way to a stock market. It is a multilateral market, where the trades executed on the market are cleared by Iberclear in three days. There are currently 20 entities which have issued securities included in Latibex, all of which are listed on a Latin American stock exchange.
|Market authorized by the Spanish government.
C) Futures and Options Market
The Futures and Options Markets are derivatives markets, and their role is to allow the risks arising from adverse fluctuations, and in relation to a particular positioning of an economic agent, to be hedged.
Up until September 9, 2013, MEFF Sociedad Rectora de Productos Derivados S. A. (MEFF) acted as both official secondary market and central counterparty (CCP) in respect of instruments classed in the financial derivatives segment and for electricity derivatives (MEFF Power). In addition, MEFF acted as CCP for Public Debt repos (MEFFREPO). This activity has been assumed by the new entity BME Clearing.
In order to comply with the requirements of EMIR legislation ((European Market Infrastructure Regulation, Regulation (EU) 648/2012), it became necessary to separate the market activities from the CCP activities. It is for this reason that the market activity relating to financial derivatives and electricity derivatives is carried on through MEFF Sociedad Rectora del Mercado de Productos Derivados (MEFF Exchange for short) and the CCP activities are pursued through BME Clearing.
MEFF Exchange is the official secondary market for financial futures and options, where fixed-income and equity financial futures and options contracts are traded. It commenced operations in November 1989 and its main activity is the trading, clearing and settlement of futures and options contracts on government bonds and the IBEX-35, S&P Europe 350 indexes, and futures and options on shares. It is fully regulated, controlled and supervised by the relevant authorities (the CNMV and the Ministry of Economic Affairs and Digital Transformation), and performs trading functions as well as clearing and settlement functions, which are perfectly integrated within the electronic market developed for that purpose.
As a result of the development of derivatives markets, 2010 saw the approval of Royal Decree 1282/2010, of October 15, 2010, regulating the official markets for futures, options and other derivative instruments. Royal Decree 1282/2010 regulates in particular the creation, organization and operation at national level of official secondary markets for futures and options, i.e. the necessary authorization of these markets, the registration of derivative instruments contracts, contracts for derivative financial instruments (general conditions, suspension of trading, exclusion of contracts), the governing companies and the market members, as well as the guarantees and non-compliance schemes. On 21 December 2018, Royal Decree 1464/2018 was approved, implementing the amended text of the Securities Market Act, approved by Royal Legislative Decree 4/2015 of 23 October and Royal Decree-Law 21/2017 of 29 December, on urgent measures for the adaptation of Spanish law to European Union regulations on the securities market, which had as its objective to advance the incorporation into Spanish law of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments (known as the "MiFID II regulatory package"), and which has as its objectives, the incorporation into Spanish law of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments (known as the "MiFID II regulatory package"): a) to ensure high levels of protection for investors in financial products, especially retail investors; b) to improve the organisational structure and corporate governance of investment services companies; c) to increase the safety, efficiency, smooth operation and stability of securities markets; d) to guarantee regulatory convergence that allows competition within the framework of the European Union; and e) to promote access by small and medium-sized enterprises to capital markets.Any individual or legal entity, whether Spanish or foreign, can be a client and trade on the MEFF Market, buying and/or selling futures and options.
The following chart reflects the trend, over the period 2015 to 2018, in contracts traded on MEFF Exchange.
Figures in thousand contracts.
|10-year bond futures||8,012||360||0||0||-|
|Contracts on Ibex 35||8,279,939||7,468,299||6,911,671||6,911,671||1.0|
|Futures on Ibex 35||7,735,524||7,146,060||6,481,301||6,564,971||1.3|
|Options on Ibex 35||544,416||322,239||430,370||418,315||-2.8|
|Contracts on stocks||31,769,507||32,736,458||32,335,004||31,412,879||-2.9|
|Futures on stocks||10,054,830||9,467,294||11,671,215||10,703,1912||-8.3|
|Futures on dividends||292,840||367,785||346,555||471,614||36.1|
|Futures on plus dividends||1,152||760||880||200||-77.3|
|Options on stocks||21,420,685||22,900,619||20,316,354||20,237,873||-0.4|
Source: Annual report on securities markets and their activities in 2018. CNMV
3.1.4 Other securities market-related figures
A) Takeover Bid
"Takeover bid" means a public offer made to the holders of shares or other securities of a company to acquire all or some of those securities, whether mandatory or voluntary, which follows or has as its objective the acquisition of control of the target company.
The Spanish legislation on takeover bids is mainly contained in the Securities Market Law for modification of the regime on tender offers and the transparency of issuers, and in Royal Decree 1066/2007 of July 27, 2007, on Takeover Bids. The aim of this legislation is to protect minority shareholders of listed companies.
Under that Royal Decree (subject to the exceptions it specifies), a takeover bid must be made for all the securities and addressed to all the holders of the securities, for an equitable price where:
- Control of a listed company is attained:
A person is deemed to have attained control where:
- He/she attains, directly or indirectly, a percentage of voting rights equal to or greater than 30% of the capital stock of the target company.
- Having attained, directly or indirectly, a percentage of voting rights lower than 30%, he/she appoints, within two years after the date of the above acquisition, a number of directors who, when added as the case may be to those already appointed, represent more than half of the members of the board of directors.
Where a takeover bid is not mandatory because the control thresholds for these purposes have not been reached, or because control was acquired before the new legislation on tender offers entered into force, takeover bids may be made on a voluntary basis.
- The shares of a listed company are delisted from the stock market.
- The capital of a listed company is reduced through the purchase of its own shares.
B) Multilateral Trading Systems (MTSs) and Systematic Internalizes
MTSs mean any system operated by an investment firm or by the governing body of an official secondary market which bring together, within the system and in accordance with its non-discretionary rules, the buyers and sellers of financial instruments to give rise to contracts, in accordance with the provisions of the Securities Market Law27.
It’s noteworthy that the Spanish clearing, settlement and registry system is currently undergoing a reform process, to bring Spain’s current post-trade processes into line with European standards and practices.
The most important MTSs authorized in Spain are the Alternative Stock Market (MAB) and the Alternative Fixed-Income Market (MARF).
The Alternative Stock Market (MAB) is a market for small-cap companies looking to expand, with a special set of regulations designed specifically for them with costs and processes tailored to their particular characteristics.
The ability to offer customized services is the hallmark of this alternative market. The aim is to adapt the system, as far as possible, to companies that are unique in terms of their size and phase of development and that have financing needs and wish to enhance the value of their business and improve their competitiveness with all of the tools that a securities market places at their disposal. The MAB offers an alternative way to finance their growth and expansion.
This flexibility involves adapting all of the existing procedures to enable these companies to be listed on a market without renouncing a suitable level of transparency. To achieve this, a new concept has been introduced, that of the "registered advisor", whose mission is to help companies comply with their reporting requirements.
In addition, companies will also have a "liquidity provider", or intermediary, which helps to find the counterparties required for efficient share price setting, and also provides liquidity. It should be noted, however, that companies that are listed on the MAB will, given their size, have certain liquidity and risk characteristics that are different from those of companies listed on the stock exchange28.
Spanish or foreign corporations with fully paid-up capital stock represented by book entries and no share transfer restrictions may apply for listing on the MAB.
At February 21, 2018, there are 41 entities listed on the MAB in the growth companies segment, 48 listed corporations for investment in the real estate market (SOCIMIs), 2824 SICAVs, 1 private equity firm and 13 free investment companies.
The Alternative Fixed-Income Market (MARF) was approved in 2012, which is an initiative aimed at channeling financial resources to a large number of solvent companies that can obtain financing using this market on the issuance of fixed-income securities.
The MARF adopts the legal structure of the Multilateral Trading Facility (MTF), making it an alternative unofficial market, similar to those in some neighboring European countries and within BME, as with the case of the MAB.
Therefore, the access requirements to this market are more flexible than those for the official regulated markets and provide greater speed in processing the issues. In this way, the companies that use MARF are be able to benefit from the process simplification and lower costs.
As established in its Regulations, approved by the Spanish Securities Market Regulator (CNMV), MARF is operated by AIAF Mercado de Renta Fija, S.A.U.
MARF is aimed mainly at Spanish and foreign institutional investors that wish to diversify their portfolios with fixed-income securities from medium-sized companies that are usually not listed and with good business prospects.
One of the players are the registered advisors, whose function will be to provide advice to companies that use MARF in terms of the regulatory requirements and other aspects about the issuance when preparing it, and their advice must be provided throughout the issuance life.
Because of the importance of this market at present and in the future as a source of financing and business boost, the regulatory and supervisory authorities have been amending the necessary regulations so that this market works smoothly29.
At February 21, 2018, 42 companies have issued bonds which are listed on MARF and have registered programs for the issue of promissory notes.
C) Market abuse regime
On April 16, 2014, Regulation (EU) 596/2014, of 16 April 16 2014, on market abuse ("Market Abuse Regulation") was approved to establish a common European legislative framework in relation to insider dealing, unlawful disclosure of inside information and market manipulation, and different measures to prevent market abuse and preserve the integrity of EU financial markets, improve investor protection and enhance investor confidence in those markets. The Market Abuse Regulation has had direct applicability in all Member States since July 3, 2016, and thus applies to any financial market of the Union.
One of the new aspects introduced by the Market Abuse Regulation is precisely the extension of its scope of application, as it also applies to financial instruments traded not only on regulated markets but also in any multilateral trading facilities, such as the MARF or the MAB in Spain, or in organized trading facilities.
Spanish legislation establishes a number of provisions applicable to issuers of securities in relation to:
- The obligation to draw up internal codes of conduct.
- The prohibition on using inside information.
- The obligation to publish and disclose relevant information.
The Regulation and the Securities Market Law contain a similar definition of "Inside information", as being any specific information that has not been made public and refers directly or indirectly to one or more issuers or to one or more financial instruments or their derivatives and which, if it were to become public, could have a considerable influence on the prices of those instruments or of the derived instruments related to them. The legislation establishes a general prohibition to use, establishing that no person may:
- Perform or attempt to perform transactions using Inside Information.
- Recommend to another person that he perform transactions with Inside Information or induce him to do so.
- Unlawfully disclose Inside Information.
The Securities Market Law establishes that issuers of securities, during the study or negotiation phase of any type of legal or financial transaction which may have a considerable influence on the market price of the securities or financial instruments concerned, among others, must:
- Restrict knowledge of the information strictly to the essential persons inside or outside the organization.
- Keep a documentary record for each transaction of the names of the persons referred to in the previous paragraph and the date on which each of them learned of the information.
- Expressly inform the persons included in the record of the nature of the information, the duty of confidentiality and the prohibition on its use.
- Establish security measures for the purposes of safekeeping, filing, accessing, reproducing and distributing the information.
- Supervise the market performance of the securities issued by them and the news reported by professional economic broadcasters and the mass media and which may affect them.
- In the event there is an abnormal change in the trading volumes or prices and there is reasonable evidence that such change is due to a premature, partial or distorted disclosure of the transaction, immediately publicize a relevant event which clearly and precisely informs of the status of the transaction in course or contains advance notice of the information to be provided.
"Relevant information" means any information of which knowledge may reasonably influence an investor to acquire or transfer securities or financial instruments and therefore may have a considerable effect on their price in a secondary market.
Issuers of securities must make public and disclose to the market all relevant information. In addition, they must send such information to the CNMV for inclusion on the official register of regulated information.
19An exception is made to this obligation where the requirements of article 35.2 of the Securities Market Law are met.
27This reflects one of the main changes introduced by Directive 2004/39/EC, which is the enhancement of competition among different ways of executing transactions on financial instruments, so that competition contributes to the completion of the common market of investment services. This way, investment firms and financial institutions providing investment services will be able to compete with stock exchanges and other official secondary markets in the trading of financial instruments.