--- title: "ESMA Q&A 1613 — Q&A — Direct Electronic Access (DEA) and algorithmic trading [Answer Published]" shortTitle: "ESMA Q&A 1613 — Q&A — Direct Electronic Access (DEA) and algorithmic trading [Answer Published]" answer_id: ESMA_QA_1613 topic: "Direct Electronic Access and algorithmic trading" status: "Answer Published" type: qa instrument_type: qa authority: ESMA binding: false binding_character: non_binding legal_status: in_force regulation: "MiFIR" mifir_level3: true mica_level2: false legal_basis: "MiFIR" date: 7 July 2017 source_link: https://www.esma.europa.eu/publications-data/questions-answers/1613 lifecycle: "Answer Published" text_version: "ESMA Q&A register, 7 July 2017" source_url: "https://www.esma.europa.eu/publications-data/questions-answers/1613" check_status: matched verified: true last_checked: 2026-10-26 checked_against: "the ESMA publication" source: prepared_by: "ESMA" published_by: "ESMA" published_in: "ESMA Q&A tool" evidence: prepared_by: "ESMA Answer" locator: "ESMA Q&A entry ESMA_QA_1613: field 'ESMA Answer', no 'Answer provided by' line" document_type: "qa_answer" legal_nature: "not_legislation" addressees: "not stated in the document" dates: published_on: "2017-07-07" question_submitted_on: "2017-07-07" locators: published_on: "ESMA Q&A Excel export ESMA_QA_1613, column 'Esma responses', date line" question_submitted_on: "ESMA Q&A Excel export ESMA_QA_1613, column 'Date of submission'" lifecycle_label: "Answer Published" --- **Answer by ESMA, published in its Q&A tool · not legislation · published 7 Jul 2017 [Answer Published]** *Answer Published · ESMA Q&A register, 7 July 2017 · Checked against the ESMA publication on 26 Oct 2026 · [Official source](https://www.esma.europa.eu/publications-data/questions-answers/1613)* | | | |---|---| | **Full title** | ESMA Q&A 1613 — Q&A — Direct Electronic Access (DEA) and algorithmic trading \[Answer Published\] | | **Prepared by** | ESMA | | **Published by** | ESMA, in the ESMA Q&A tool | | **Reference** | ESMA_QA_1613 | | **Document type** | Q&A | | **Legal nature** | Not legislation | | **Addressees** | Not stated in the document | | **Dates** | Published 7 July 2017; question submitted 7 July 2017 | | **Legal basis** | MiFIR | | **Related instruments** | None recorded | | **Text on this page** | Word for word — the full text of the ESMA publication | **Direct Electronic Access (DEA) and algorithmic trading** ### Question Under Article 3(2)(a) of Commission Delegated Regulation (EU) 2017/580 (RTS 24), there is a requirement to flag orders submitted to a trading venue “as part of a market making strategy pursuant to Articles 17 and 48 of \[MiFID II\]”. Should a firm start flagging orders when it decides to submit orders with a view to make markets in a particular instrument, or only when it concludes a formal agreement with the trading venue subsequent to triggering such an obligation under Article 1 of Commission Delegated Regulation (EU) 2017/578 (RTS 8)? *** ### Answer \[ESMA 70-872942901-38 MiFID II MiFIR market structures Q&A, Q&A 3.17\] The primary purpose of flagging as required under Article 3(2)(a) of RTS 24 is to enable efficient detection of market manipulation by distinguishing the order flow from an investment firm based on pre-determined terms established by the issuer or the trading venue from the order flow of the investment firm acting at its own discretion (see Recital 6 of RTS 24). ESMA therefore expects that only those orders submitted to a trading venue as part of a market making strategy subsequent to the conclusion of a market making agreement with the relevant trading venue should be flagged as such in field 8 as designated in Table 2 of the Annex of RTS 24. The same applies to field 3 of Table 3 of Annex II of RTS 6. *** **Source:** [ESMA original document](https://www.esma.europa.eu/publications-data/questions-answers/1613)