ESMA spells out when venues and NCAs can change an EU share's tick size

On 15 October the European Securities and Markets Authority (ESMA) updated its manual on post-trade transparency under MiFID II and MiFIR. The update has two parts:

• Tick sizes: existing and new Q&As on the tick-size regime, together with recommendations on when trading venues and national competent authorities (NCAs) may intervene.
• OTC derivatives: guidance on identifying derivatives subject to transparency requirements, and on the reference data that should accompany them for the consolidated tape.

ESMA said the tick-size material aims to “enhance supervisory convergence”.

Tick sizes: what can change and when

Under RTS 11, the minimum tick for shares, depositary receipts and ETFs depends on price and on the instrument’s liquidity band. The liquidity band is set by the average daily number of trades (ADNT) on the most relevant market in terms of liquidity (MRMTL). The updated manual, with entries marked as updated on 15 October, addresses several practical questions.

Manual intervention

ESMA has answered whether a venue or NCA can intervene to allow a different tick size where the mandated minimum harms liquidity. The answer depends on the calculation stage:

• Estimates stage: a change “can always be granted”. The relevant competent authority can ask ESMA to adjust the tick size before or after admission to trading, up to the point the four-week calculations take effect, six calendar weeks after the first-trading date.
• Non-EEA ISINs: for shares with a non-EEA ISIN, or traded on a third-country venue where that venue is the most liquid market, regulated markets may apply the tick size used on that venue, or a different one after a corporate event.
• Other shares: for other shares and depositary receipts, the ADNT estimate “cannot be changed” once it has been set by the first four weeks of trading, unless there has been a corporate action.

Corporate actions

Any corporate action that the NCA expects to change the average daily number of trades materially may trigger a recalculation. ESMA’s examples include share buybacks and share issuance that would otherwise leave the instrument “in a liquidity band that would not be optimal”.

Most relevant market

Corrections to the MRMTL are possible at the estimates or four-week stage, for example where a venue reported the wrong first-trading date. They are not possible once annual calculations apply.

Default band

Where an ADNT has not been published, venues should assign the highest liquidity band, ADNT of 9,000 or more, until it is published.

OTC derivatives

The update clarifies how identifying reference data for OTC derivatives should be provided “in accordance with” Annex II of RTS 2 as amended by Delegated Regulation 2025/1003. ESMA says this supports consistency in data published through the consolidated tape. It says this part of the manual should be treated as a draft until RTS 2 and the RTS on CTP input and output data enter into force.

Why it matters

Tick-size calibration remains a constant issue in EU equity microstructure. A band set too fine fragments queues and encourages pinging. A band set too coarse widens spreads and pushes flow to venues and mechanisms that do not apply the regime.

For listing venues, the guidance confirms that the first six weeks after admission are the only reliable chance to correct a poor calibration without a corporate action. Issuers planning large buybacks have a route to recalculation, but it runs through the NCA.

For derivatives data teams, the OTC reference data guidance is effectively the specification for what the coming derivatives tape will expect.

Sources

• ESMA press release, 15 October 2026 — https://www.esma.europa.eu/press-news/esma-news/esma-updates-its-manual-transparency-new-guidance-otc-derivatives-and-tick
• ESMA, Manual on post-trade transparency under MiFID II/MiFIR (updated 15 October 2026) — https://www.esma.europa.eu/sites/default/files/2023-07/ESMA74-2134169708-6870_Manual_on_post-trade_transparency.pdf