European Securities and Markets Authority Proposes Draft Technical Standards for Consolidated Tape Providers

The European Securities and Markets Authority has opened a consultation on draft technical standards related to consolidated tape providers and data reporting service providers, and the assessment criteria for the CTP selection procedure. The Markets in Financial Instruments Regulation envisaged the establishment of a "consolidated tape" for all equity and non-equity transactions. The CTP would collect post-trade information published by trading venues and Approved Publication Arrangements, and consolidate this into a continuous live data stream made available to the public. No consolidated tape has yet been set up in either the EU or the U.K. Following the March publication in the Official Journal of the European Union of the EU's MiFID Review legislation, the provisions in MiFIR on CTPs and DRSPs have been revised to, among other things, require trading venues and APAs (collectively referred to now as "data contributors") to submit market data directly and exclusively to the entities appointed by ESMA as the CTP for each asset class.

SMA's consultation considers the input and output data requirements of CTPs, the revenue redistribution scheme for the equity CTP, the synchronization of business clocks, and the authorization and organizational requirements for DRSPs. ESMA also sets out its initial reflections on the specification of the assessment criteria for the CTP selection procedure.

Responses to the consultation may be submitted until August 28, 2024. ESMA intends to submit the final draft technical standards to the European Commission by the legislative deadline of December 29, 2024. It will also publish a feedback statement on the specification of the assessment criteria for the CTP selection procedure by the end of 2024.

ESMA has also published today a consultation on amendments to the commodity derivatives technical standards. On May 21, 2024, ESMA published its first MiFID Review consultation on draft regulatory technical standards covering transparency requirements, transaction reporting requirements and the obligation to make trade data available on a "reasonable commercial basis."

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