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MarketAxess, Tradeweb and Bloomberg plan joint EU bond price feed
Global Banking & Finance Review®
Company
By Huw Jones
LONDON (Reuters) – MarketAxess, Tradeweb and Bloomberg said on Wednesday they were exploring a single price feed for corporate and government bonds in the European Union as the bloc works to better integrate its capital market.
The EU plans to amend its securities rules to require a single price feed, or “consolidated tape”, of trading across different platforms in the bloc for investors and banks, helping to knit markets and improve data quality.
“The consolidated tape service is expected to be provided – subject to the relevant regulatory approvals – via a joint-venture company established and operated independently from our respective businesses,” Tradeweb, MarketAxess and Bloomberg said in a joint statement.
All three already operate their own approved publication arrangements (APAs) for reporting trades.
The draft law is being negotiated by EU states and the European Parliament, but it is unclear when the final green light will be given as exchanges are pushing back on how a tape would work for stocks.
There are already stock and bond tapes on U.S. markets, and Britain is also considering a fixed income market tape.
The EU envisages tapes for a range of asset classes, with the procurement process, authorisation and supervision undertaken by the bloc’s European Securities and Markets Authority (ESMA).
“We believe that the European Commission’s draft proposed legislative revisions would open a window to developing a robust consolidated tape that will increase market transparency and help facilitate an integrated, single European capital market,” the three companies said.
“As a next step, we are preparing a competitive request for information process to review independent third-party technology and operating partner(s) for the consolidated tape service.”
A key issue to resolve for a bond tape is how to better standardise deferrals, or the amount of time data is published after the transaction in order to make a tape more timely.
(Reporting by Huw Jones; Editing by Mark Potter)
A consolidated tape is a service that provides a single price feed of trading data across different platforms, helping to improve market transparency and data quality for investors and banks.
Corporate bonds are debt securities issued by companies to raise capital. Investors lend money to the company in exchange for periodic interest payments and the return of the bond's face value at maturity.
The European Securities and Markets Authority (ESMA) is a regulatory agency of the European Union that aims to enhance investor protection and promote stable and orderly financial markets.
Market transparency refers to the extent to which information about market conditions, prices, and transactions is available to all participants, helping to ensure fair trading and competition.
Approved Publication Arrangements (APAs) are mechanisms that facilitate the reporting of trades in financial instruments, ensuring compliance with regulatory requirements and enhancing market transparency.
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