Nasdaq fails to pacify SuperMontage critics

Nasdaq fails to pacify SuperMontage critics

The Nasdaq Stock Market has submitted a modified version of its SuperMontage trading system proposals in a bid to fend off criticism from Electronic Communications Networks.

An early draft of the proposals drew an angry response from ECNs which claimed that the presentation of prices in SuperMontage discriminated against them. Under the initial version, ECN access fees were to be included in the prices quoted over SuperMontage. Nasdaq'a revised plans, which have been submitted to the SEC for approval, give users the option to view prices with or without ECN access charges included.

Richard Ketchum, Nasdaq’s president says: "After months of proposals and reactions, I think we now have a breakthrough proposal. This is a fair resolution to this issue. It is hard to argue with letting the market decide."

Commenting on the proposed changes, Kevin Foley, chairman and CEO, Bloomberg Tradebook says: "With the modifications on the table, we are now prepared to be fully supportive of the proposal. The modifications being considered seem to be a fair resolution to what has been a difficult set of issues."

Other ECNs have been less supportive. Both Instinet and Archipelago are continuing to resist the revised proposals, arguing that as a monopoly supplier of market data, Nasdaq should not be allowed to assume a quasi-regulatory status over its competitors.

Instinet CEO Doug Atkin states: "This proposal disadvantages investors and therefore we continue our opposition to SuperMontage and voice our strong disagreement with the latest version of the proposal. The Nasdaq-Bloomberg 'deal' appears to place their business interests and the interests of market makers ahead of investors."

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