16.IV Conclusion about MiFID I

In contrast with the previous regime (ISD), MiFID I introduced rules with respect to the price of equity pre- and post-trade data. The MiFID I framework consisted out of: (1) a broad requirement to make equity pre- and post-trade data available on a reasonable commercial and non-discriminatory basis; and (2) CESR guidance to unbundle equity pre- and post-trade data from other services and/or data. The increase in EU regulation and CESR guidance for equity pre- and post-trade data prices was the consequence of the competitive framework envisioned for MiFID I. The fragmentation risks implied in the competitive trading landscape set out for MiFID I would require ‘reasonable’ and ‘non-discriminatory’ equity pre- and post-trade data prices (i.e. in a fragmented trading landscape data needs to be bought from multiple venues in order to have a trading overview).

Despite the new top-down elements, the MiFID I framework for equity pre- and post-trade data prices was overall bottom-up. First, the MiFID I principle of a reasonable commercial basis was not specified. The EU left the interpretation of specific data prices, as well as the terms and conditions for equity pre- and post-trade data, up to the data suppliers (e.g. RMs, MTF, SIs, and data vendors). The EU strategy was to rely on competition to ensure ‘reasonable’ and ‘non-discriminatory’ data prices, as supported by the broad MiFID I provisions. Second, CESR’s guidance was top-down, but only mildly so since the CESR guidance was formally non-binding. Third, CESR’s guidance on unbundling did not apply to data vendors. Fourth, and finally, MiFID I left many other elements of data pricing untouched, such as whether data needed to be offered for free after a certain period (e.g. 15 minutes after publication).