--- title: "ESMA Q&A 1707 — Q&A — Transaction reporting [Answer Published]" shortTitle: "ESMA Q&A 1707 — Q&A — Transaction reporting [Answer Published]" answer_id: ESMA_QA_1707 topic: "* Transaction reporting" 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: 17 November 2017 source_link: https://www.esma.europa.eu/publications-data/questions-answers/1707 lifecycle: "Answer Published" text_version: "ESMA Q&A register, 17 November 2017" source_url: "https://www.esma.europa.eu/publications-data/questions-answers/1707" 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_1707: 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: "2017-11-17" question_submitted_on: "2017-11-17" locators: published_on: "ESMA Q&A Excel export ESMA_QA_1707, column 'Esma responses', date line" question_submitted_on: "ESMA Q&A Excel export ESMA_QA_1707, column 'Date of submission'" lifecycle_label: "Answer Published" --- **Answer by ESMA, published in its Q&A tool · not legislation · published 17 Nov 2017 [Answer Published]** *Answer Published · ESMA Q&A register, 17 November 2017 · Checked against the ESMA publication on 26 Oct 2026 · [Official source](https://www.esma.europa.eu/publications-data/questions-answers/1707)* | | | |---|---| | **Full title** | ESMA Q&A 1707 — Q&A — Transaction reporting \[Answer Published\] | | **Prepared by** | ESMA | | **Published by** | ESMA, in the ESMA Q&A tool | | **Reference** | ESMA_QA_1707 | | **Document type** | Q&A | | **Legal nature** | Not legislation | | **Addressees** | Not stated in the document | | **Dates** | Published 17 November 2017; question submitted 17 November 2017 | | **Legal basis** | MiFIR | | **Related instruments** | None recorded | | **Text on this page** | Word for word — the full text of the ESMA publication | **Transaction reporting** ### Question How should transactions be transaction reported where portfolio management has been outsourced? *** ### Answer \[ESMA 70-1861941480-56 MiFIR data reporting Q&A, Q&A 24.7\] Consider the following example, where Banks A, B and Firm Z are investment firms: Client has a portfolio at Bank B. The client is a German national, Max Mustermann. His date of birth is 01/04/1974. Bank B has outsourced the portfolio management (discretionary mandate) to Firm Z, which is an investment firm undertaking portfolio management. Firm Z sends a purchase order to Bank A for execution without meeting the conditions for transmission under article 4 of Commission Delegated Regulation (EU) 2017/590. Firm Z is acting in an ‘any other’ trading capacity. Firm Z does not have a contract with the Client. Bank A executes the order on a Trading Venue. Bank A transfers the financial instruments from its own account to the account of Bank B just for settlement purposes. Bank B books the financial instruments from its account into the account of the Client. Bank A and Bank B are acting in an own account trading capacity The reports by Bank A and Bank B will be as follows: Bank A is receiving instructions from Firm Z without the transmission requirements being met so it will report Firm Z as the buyer in its client side report. Bank B’s counterparty for execution purposes is Firm Z and since Bank B has not met the transmission conditions it will report its client as the buyer and itself, Bank B, as the seller. Bank B has outsourced the discretionary management for its client to Firm Z so there is a power of representation. However, field 12 is only populated where the decision is made under a power of representation and the buyer is a client of the executing entity. Therefore field 12 is only populated in Report 2 of Bank B, since in Report 1 Bank B is itself the buyer. Even though Firm Z is making the investment decision on behalf of Firm B, field 57 is a mandatory field where a firm is acting in an own account trading capacity since the firm is accepting the risk. Therefore this should be populated with the algo or person in Bank B that is primarily responsible for the decision to delegate. Field 59 is a mandatory field but where the execution decision is made outside the firm it is populated with ‘NORE’. In this scenario the execution decision is being made by Firm Z as it is deciding when and how to execute (by sending orders to Firm A) and therefore this field is populated with ‘NORE’ in Bank B’s reports . Reporting by Firm Z Firm Z is acting on behalf of Bank B and since Bank B has not met the transmission conditions it will report Bank B as the buyer and Bank A as the seller. Firm Z is making an investment decision on behalf of Bank B so it will populate field 12 with its LEI and will populate field 57 with the algo or national ID of the person responsible for the investment decision within the firm. Bank A and Bank B are acting in any other trading capacity and Bank B is not meeting the conditions for transmission under article 4 of the Commission Delegated Regulation (EU) 2017/590. Since the buyer in Bank B’s report is its client and there is a power of representation field 12 is populated with the LEI of Firm Z in Bank B’s report. Since the execution decision is made outside the firm (being made by Firm Z) field 59 is populated with ‘NORE’ in Bank B’s report. *** **Source:** [ESMA original document](https://www.esma.europa.eu/publications-data/questions-answers/1707)