Consolidated Tape: A way forward

The compromise of the negotiators of the Member States and the EU Parliament on the MiFIR/MIFID II review is going to be turned into a legislative text. Among other things, a consolidated tape (CT) for equities and ETFs is to be introduced.

A spokesperson for the German Investment Funds Association BVI said:

‘The compromise on the CT is a way forward. Although the EU legislators lacked the willingness to provide comprehensive transparency in pre-trade data, the provision of the European best bid offer in real-time for equities and ETFs at least offers investors an indication for their trades. In addition, the CT can be helpful in calculating transaction costs for PRIIPs KIDs of funds.’

‘EU legislators should confirm the voluntary use of the CT. Mandatory use is not acceptable. This is because asset managers will still have to buy data directly from exchanges, which the CT does not provide.’

‘Furthermore, the EU legislators should not accept a planned economy element in which they guarantee a minimum revenue to exchanges as data contributors of the CT. After all, this would mean that the EU legislators would waive the market economy principle embedded in MiFIR that the pricing of financial market data shall be based on reasonable commercial basis plus an appropriate margin.’