I’ve not heard any discussion about this guideline, which came out in January.  This guideline was developed jointly by the market regulators, and is to be applied by the market regulators themselves. It says, “CESR considers that RMs, MTFs, and investment firms should not make the supply of pre- and post-trade information conditional on the purchase of other bundled services.”  Commercially, this sort of action is generally called “bundling”, and it’s generally considered to be illegal, so CESR has made it clear: “No Bundling”.

Guideline 9 should mean that an exchange can’t make you buy its own on-exchange data in order to obtain the off-exchange data that the exchange has also gathered from other venues and investment firms.  That should mean that the off-exchange data is also priced separately from the on-exchange dataWill exchanges bundle the data – give away the off-exchange data free with their own on-exchange data?  That’s always possible, but investment firms have a right to charge for their off-exchange data, and so it might be hard for an exchange to pay an investment firm for the firm’s data and yet give that data away free to end-users.

Interestingly, CESR has not limited the scope of Guideline 9 to bundling data with data – it says no bundling of data with other “services”.  That should mean that an exchange can’t force you to buy the exchange’s own private network connection in order to get either the exchange’s on-exchange data or the off-exchange data.  A fair number of exchanges across Europe still operate their own private networks, and only deliver their data via their own private networks.

CESR’s guidelines are clearly going to impact exchanges that try to use their market-dominant position today to control the shape of service delivery in Europe post-MiFID.