The FCA is inviting Expressions of Interest from potential providers for a UK equity consolidated tape in an effort to boost liquidity in fragmented capital markets.
An equity tape brings data from across UK markets together, providing investors with a clear, consistent view of trading volumes and prices across UK venues.
Simon Walls, interim executive director of markets at the FCA, says: “UK markets offer diverse trading options which can be great for competition, choice, and lowering trading fees. But this landscape makes it harder to assess liquidity as a whole in our markets.
“The equity consolidated tape seeks to tackle this challenge head on by delivering more straightforward access to equity market data from across venues, supporting better decisions and boosting market participation.”
The consultation is seeking feedback on introducing a tape that includes both post-trade data and the attributed best bid and offer prices across UK trading venues, with a view to going live in 2007.
The FCA has already established a framework for a bond tape. However, this has received a legal challenge on the award of the £4.8 million contract to Etrading Software. Competitor Ediphy, which has previously been awarded the EU fixed income tape mandate, appealed against the deal, with the firm claiming that a technical error in the auction software unfairly excluded it from the tender. The FCA has filed an application with the High Court, asking it to lift the suspension on the contract award.