Short Code Reconciliation Solution

With the new MiFID II regulation the trading venues are required to keep a database of all order records, for all markets that they operate, for a minimum of five (5) years. Upon request from a competent authority, the trading venue has to make this data available in a predefined report format.

Nasdaq's Solution

Three new MiFID II Order Entry Fields are introduced, they may contain sensitive and confidential data, therefore the solution that Nasdaq will implement requires members to submit ‘short codes’ on each order. These fields are Client Identification, Execution Decision and Investment Decision. Nasdaq will support short codes for the Equity, Equity Derivatives, Commodities and Fixed Income markets.

The short codes will be created by the members. Nasdaq will not validate short codes upon order entry, but we expect a short code that has been used a specific trading date, to be mapped up at the latest by end of day, that very same date.

Kodiak OMS Solution

Kodiak OMS creates and sends shortcodes for the values chosen in the new MiFID II Order Entry Fields, for further information check out our wiki page (MiFID II - New Order Entry Fields ). If the new Order Entry Fields are filled with the autocomplete functionality of the textboxes, Kodiak OMS sends the corresponding shortcode for that customer or user.

We offer a solution that maps the short codes sent by Kodiak OMS to the correct long code, this will happen automatically throughout the day at a given interval. After the solution has mapped the long codes to short codes it will send an email to the client with a report. If the short codes are filled with the autocomplete boxes in the new MiFID II order entry fields then this process is automatic. If the short codes are manually inserted through Kodiak OMS (a number is typed into the new order entry fields), you must manually map the long code in the Nasdaq Member Portal. At the end of each business day Nasdaq will send you an email with all the unmapped short codes, there should be no short codes to map at the end of the day if the new order entry fields are correctly filled.

Instructions for short code administration in the Nasdaq Member Portal

In order for the Kodiak OMS Service to work members must:

• Create "Short Code API User" in Nasdaq's Member Portal by an "Member Portal Administrator".

• Login the Member Portal with the "Short Code API User" credentials to obtain a Token, note with every login the token changes.

• This token must be supplied to the Kodiak OMS Service which will handle the mapping of the short and long codes

• At least one user should be appointed the "Short Code Administrator" role in the Member Portal., that user can see all mapping of short code and long codes.

Further instructions can be found here.