Asset management association Efama has called for voting rights surrounding how the European consolidated tape – a system for improving the electronic distribution of market data – is established.
Efama wants to see the European Securities & Markets Authority (Esma) mandate a governance model that “moves beyond an advisory board” to a full-fledged board with voting rights for a representative cross-section of stakeholders.
This cross-section includes the user community, such as the buyside asset managers that Efama – the European Fund & Asset Management Association – represents.
This board would decide on pricing policies, fee structures, licencing policies, and speed and connectivity, among other issues.
Efama’s call comes after Esma recently closed the consultation for regulatory technical standards that will define the competitive selection process for the consolidated tape, as well as the technical abilities that applicants will be assessed on.
In the past, Efama has called persistently for the establishment of consolidated tapes for equity/ETF and bond data in order to deal with Europe’s fragmented capital markets which have been “marked by a lack of complete and accurate data on European trading activity”.
Some asset managers were able to, at significant cost, build in-house data solutions to cleanse and aggregate data, while others had to operate on incomplete market data, said the trade body.
Efama said consolidated tapes wouldl democratise access to market data, including to retail investors, and would improve the attractiveness and competitiveness of European markets by providing global investors with the confidence they need to invest through a “golden source” of trading data.
Tanguy van de Werve, director general at Efama, said: “Given that we are ever closer to the launch of bond and equity/ETF tapes in Europe, we are thinking ahead about how to futureproof the tapes. How do we ensure that conflicts of interest do not arise, that the tapes continue to meet the needs of a wide range of users, and that fees remain competitive? A robust governance framework with a stakeholder–driven board is the best way we can think of to avert any of these negative outcomes.”
