French Monetary and Financial Code
In forceIn this sub-section and for the purposes of the provisions relating to algorithmic trading :
1° "algorithmic trading" means trading in financial instruments in which a computer algorithm automatically determines the parameters of orders, such as whether or when they should be issued, the price or quantity terms, or how they will be managed after they have been issued, without human intervention or with limited human intervention. Algorithmic trading does not mean mechanisms used solely for :
a) Routing orders to one or more trading platforms;
b) The sole processing of orders in the absence of trading parameters;
c) Order confirmation;
d) Post-trade processing of executed transactions;
2° "High-frequency algorithmic trading technique" means any algorithmic trading technique characterised by both:
a) An infrastructure designed to minimise computer latency and other types of latency, including at least one of the following systems for the insertion of algorithmic orders: co-location, proximity hosting or high-speed direct electronic access ;
b) A mechanism that decides to generate, generates, routes or executes orders without human intervention;
c) A high intraday flow of messages constituted by orders, quotes or cancellations;
3° "Market-making strategy" means, for an investment services provider other than a portfolio management company that deals on own account and acts as a member of a trading platform, the simultaneous display of firm and competitive bid and offer prices for comparable sizes in one or more financial instruments on that platform, with the result of providing liquidity to the market as a whole on a regular and frequent basis.
