Investors are to have access to better, up-to-date information as new rules simplifying access to market data come in to force shortly, according to the European Council.
Changes to the European Union’s (EU) trading rules will establish so-called “consolidated tapes” that will centralise data feeds for different kinds of assets. That will bring together data provided by a range of financial organisations together in one place.
The changes concern the Markets in Financial Instruments Regulation (MiFIR) and the Markets in Financial Instruments Directive (MiFID) which together regulate investment services and financial markets activities in the EU.
Better access
“Investors will have access to up-to-date transaction information for the whole of the EU,” the Council said. “This will make it easier for both professional and retail investors to access key information such as the price of instruments and the volume and time of transactions.”
The new rules impact the commission earned by some brokers. So-called payment-for-order-flow enables some brokers to receive commission for forwarding clients to certain trading platforms. The practice will be banned by 30 June 2026.
Tapes
The rules are meant to make European markets operate in a similar way to Wall Street, where tapes have existed for decades. But creating such tapes is likely to be difficult, according to Reuters news agency.
“Three heavyweights in the bond trading sector said last month they had scrapped plans to provide a bond tape, citing complexity and costs,” Reuters reported. “Tapes have been mired in industry infighting in Europe over how exchanges should be paid for their price data, a key element of their earnings.”
The texts describing the changes will be published in the EU’s Official Journal shortly and enter into force 20 days later. The regulation will apply immediately in all EU countries, whereas the member states will have 18 months to bring into force the laws, regulations and administrative provisions necessary to comply with the directive. The rules do not apply in the UK, but the UK government is looking to enact similar provisions.
