The hit release of a “consolidated tape” is a function benchmark during which the luck of an EU capital markets union (CMU) can also be measured, says Tilman Lüder, head of the securities markets unit on the European Commission.
EU government was exploring the technicalities of making an unmarried, close to a real-time file of industry costs, referred to as a consolidated tape, for equities and bonds for a number of years however to this point no information supplier has been ready to fulfill its wide-ranging necessities.
“It’s the one thing that will hold the European landscape together,” Mr. Lüder instructed delegates on the Association for Financial Markets in Europe’s annual convention on October 7-9.
“If we manage to create a decent consolidated tape between all the different European venues and if we manage to use the tape as a tool to make these markets attractive and competitive – so that people want to come to Europe and trade because it is a fair and transparent system – then we will succeed,” Mr. Lüder mentioned.
European Consolidated Tape outlook
The European Securities and Markets Authority (ESMA) and the European Commission have had a look right into a European Consolidated Tape (ECT) as a part of wider consultations at the overview of the Markets in Financial Instruments Regulation and Directive (MiFIR/MiFID II).
Among the tips floated at the time have been deciding on a unique supplier for 5 to seven years, forcing venues to give you the information, making customers pay for the tape so it’s correctly funded, or consolidating just about all transactions throughout asset categories at the tape.
Industry response to the implementation of an ECT has been combined. Some companies view it as a way of using down information prices and fostering cross-border job whilst others view it as unachievable.
However, Mr. Lüder sees an ECT as a lot more than simply using down the price of information. “The tape is really about bringing fragmented trading venues together and that goes across many asset classes,” he mentioned, including that the European Commission’s ambitions transcend setting up a consolidated tape for equities and would really like one for bonds as smartly.
“The consolidated tape is more an instrument for the internal market — it is not primarily a tool to solve market-data costing issues,” he mentioned, including that its status quo would now not be prohibitively pricey.
He mentioned ESMA will quickly put out steerage on an ECT and can duvet spaces comparable to prices, pricing and this may supply some readability on information charge schedules.
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