Accountability mechanisms in the governance of high-frequency trading under MiFID II

This chapter explores accountability mechanisms in the governance of high-frequency trading under MiFID II at the agenda-setting stage, during the formulation of technical standards and in the implementation phase. The chapter shows that the European Parliament played an active and relevant role during the agenda-setting and the initial policy-formulation stages by using the procedural accountability mechanisms available. However, there is no substantive ex-post oversight of the decisions made. During the specification of technical standards, we observe extensive hybrid accountability mechanisms between ESMA and industry stakeholders in which ESMA at times accommodates the interests of the latter. Procedural accountability mechanisms between national parliaments and supervisors are also extensively present during the implementation phase - i.e. market supervision - but they are not always used by politicians due to a lack of expertise and the high complexity of the subject.