FESE wishes to thank ESMA for its work on the challenging task of developing draft technical standards related to CTPs. FESE welcomes many of the proposals and has leveraged the expertise of its members as future data contributors to provide thoughtful feedback on certain elements that could be refined. These include but are not limited to:

• The proposed minimum latency requirements for data submission should be finetuned, as these may not always be technically feasible for all participants.
• We discourage the use of JSON for data transmission. Instead, we suggest leveraging existing formats and protocols, and if a new protocol is defined, it should be uniform across all asset classes.
• The input data for the CTP should be limited to what is necessary for the CTP to be operational; therefore, we have concerns about an automatic link with RTS 2 for the bonds tape.
• The CTP should not be expected to enhance the quality of the data provided in terms of specific content; this responsibility should rest with the data contributors, who have systems and controls in place to ensure data quality.
• A dedicated RCB framework is needed for the CTP, which takes into account the underlying costs incurred by data providers for the production and transmission of data.
• The potential provision of value-added services by the CTP would present issues from a competition standpoint vis-à-vis data providers and data vendors.

FESE Response To The ESMA Consultation On RCB And RTS 23

Reasonable Commercial Basis

FESE members understand that ESMA aims to establish a more structured and transparent approach to market data pricing. While FESE members support this objective, it is crucial to carefully calibrate the various provisions to avoid a restrictive approach that could have unintended consequences for the market and its participants.

In our response, we welcome some of ESMA’s proposals that incorporate a principle-based approach and share thoughtful input on others that we consider may benefit from further embracing this approach. Overall, we should not lose sight of the broader pricing models in financial services that ensure data access for all types of users, as well as the existence of varying business models among exchanges, in which market data is an integral part. We must also remain mindful of the unique characteristics of market data as both a digital product and a joint product with trade execution, and ensure that market data quality continues to be the driving goal. We are ready to collaborate with regulators and policymakers to effectively shape these RTS.

RTS 23

FESE welcomes ESMA’s proposals related to RTS 23. We support the effort to streamline reference data reporting requirements and offer further suggestions in this regard. We would also appreciate clarification on several new fields, as well as the resolution of long-standing issues related to the misclassification of CFI codes, among other aspects.

Source: FESE