Trading venues and approved publication arrangements (APAs) – or post-trade data aggregators – are not always complying with the requirement to make available data free of charge 15 minutes after publication in Europe, according to market participants.
In feedback to the European Securities and Markets Authority (ESMA) consultation on developing a consolidated tape for equity markets, data users said that access to publicly available data was said to have improved but in some cases all the requirements were not being met.
The requirement which seems to be the most problematic, according to feedback provided, is the publication in a machine-readable format, with some users explaining that many trading venues only provide data in a format which can be easily read, used and copied as a ‘premium service’ available for a fee. Subsequently firms must pay that fee to be able to use data effectively, a problem particularly relevant for non-equity data.
Some trading venues were also said to have implemented strict definitions of value-added services and charge for delayed data, while trading venues and APAs charge redistribution fees even when the distributor does not charge for the data from the final users.
Where delayed data is provided free of charge, the terms of use are so restrictive they may prevent effective use.
In a statement published on 5 December 2019, Steven Maijoor, ESMA chair, said, “Transparency is important to ensure that markets are fair, sound and efficient. However, after nearly two years of operating under MiFID II, we are still lacking a reliable view of liquidity across the EU. Therefore, we need to establish a real-time consolidated tape for equity instruments to remedy the fragmentation of EU markets, create a real single market and so contribute to the establishment of the Capital Markets Union.”
He continued, “Access to market data is becoming increasingly important for securities markets and it is important that data users know what they are paying for. ESMA will therefore provide further guidance on the cost of market data.”
The DESK’s update on the development of a consolidated tape for bond trading is can be found here: Market Structure Q4.2019.
©The DESK 2020