17 October 2007

FSA approves Deutsche Börse MiFID trade reporting service

Deutsche Börse has been granted "Trade Data Monitor" (TDM) status by the UK's Financial Services Authority (FSA) for its MiFID OTC post-trade transparency service.

The service enables investment firms to meet post-trade transparency requirements for off-exchange equity transactions under the Markets in Financial Instruments Directive (MiFID) which launches in November.

Clients can publish OTC transactions that are subject to publication requirements via Deutsche Börse. The service covers all instruments that are subject to post-trading transparency requirements Europe-wide, and offers optional automatic delay for large transactions, in accordance with MiFID, says the German exchange.

Holger Wohlenberg, MD of Deutsche Börse and responsible for market data and analytics, says: "Receiving trade data monitor status from the FSA increases the attractiveness of the MiFID OTC post-trade transparency service especially for our British clients."

Earlier this week European alternative trading system Instinet Chi-X said it had been granted a trade reporting licence by the UK authority.

Chi-X Europe will provide a real-time, FIX 4.4 trade data feed to participants and vendors and will receive submitted trade reports via the same format. In order to provide post-trade transparency, Chi-X Europe says it will handle trades, trade corrections and trade cancellations, as well as the delayed publication of block trades.

Chi-X also said it would offer off-exchange trade reporting for a monthly fee of £210 per client connection, but there would be no charges for market data, licence fees, data feed fees or message or volume traffic.

Following that move, BOAT - a new trade reporting start-up owned by a group of investment banks - says it will offer its real-time dataset free of charge until 1 January 2008 "as part of a marketing initiative to demonstrate the value, accuracy and breadth of its data".

BOAT will start reporting two-thirds of the EU's off-exchange share trades when it launches in November. The new pricing initiative will give end-users the opportunity to use the data and fully assess its value before it becomes a fee-paying service, says Will Meldrum, MD and head of BOAT at Markit, which is responsible for business operations for the venture.

Following extensive consultation with potential clients, market data vendors, trade associations, consultants and user groups, BOAT says it will provide a delayed datafeed, which will be made available free of charge as from 1 January 2008.

The FSA is yet to approve the new trade reporting service from the BOAT collective for TDM. But contrary to unfounded market gossip, BOAT is on course for TDM status. A BOAT spokeperson told Finextra: "The BOAT TDM application is in process. The TDM audit is being finalised which is a key part of the information required by the FSA. BOAT will update the market in due course."

© Graham Bishop