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Plato Partnership proposes new standards for managing market outages

Plato Partnership today announced new standards for managing cash equities market outages, developed by Plato member firms with discussions with major European exchanges including Deutsche Börse, Euronext, SIX Swiss Exchange, and Nasdaq OMX.

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The standards, developed by a Plato working group of buy- and sell-side market participants, aim to enhance the resilience, consistency and transparency of market operations during outages. They were developed in close collaboration with the Financial Conduct Authority’s (FCA) working group on market outages, who are developing standards for UK trading venues, ensuring consistency across both UK and European trading venues for market participants.

The proposed standards:

• Communication of Order and Trade Status: Trading venues must communicate order and trade status to members within 30 minutes of an outage. The communication will include an outage timestamp marking orders placed, and trades executed, before the outage timestamp as valid while those placed after will be void and cancelled upon service restoration.

• Order Book Purge: As a general principle, all orders in the order book at the time of an outage will be purged prior to market re-opening, without exceptions for different order types. It is important to note that some Exchanges may decide depending on the order integrity not to perform a global purge.

• Market Re-opening Protocols: A standard 15-minute notification period to re-open will be provided to market participants and an additional 15-minute pre-open period will be applied for insertion, amendments & cancellations.

• Determination of Closing Prices: All trading venues in an outage must apply a standard cut-off time to declare the closing price of 17:00 UK / 18:00 CET. In the event an outage prevents a closing auction taking place prior to the cut-off time, the determination of the official closing price should be applied in the following order by the trading venue: Last traded price where the continuous phase has commenced; Opening price where the continuous phase has not commenced; Prior closing price where the market has not opened.

• Enhanced Trading Venue Communications: Trading venues must maintain resilient communication channels, including providing status updates every 15 - 30 minutes during an outage, even if there are no new updates.


This collective step forward will elevate the standards for transparency and effectiveness, setting a new benchmark for best practices in response to market outages across the region.

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