18.IV.2 Consequences for published and consolidated equity pre- and post-trade data

The competitive market setting of the EU equity markets since MiFID I have resulted in fragmented liquidity and related dispersed data. The EU has responded by means of more EU regulation on publication and consolidation arrangements for equity data, in particular equity post-trade data. A main consequence of the increase of EU regulation is that the entities responsible for equity pre- and post-trade data publication (i.e. RMs, MTFs, and investment firms operating outside such venues (including SIs)) have less freedom in choosing the publication arrangements. Another consequence is that consolidation of equity post-trade data, and potentially also of equity pre-trade data, fall under an EU framework for consolidation. The result is less freedom for market driven publication and consolidation services, albeit that the EU’s ascendancy over publication and consolidation arrangements is not total.

The EU’s approach has not been successful in achieving the desired degree of publication and consolidation quality for equity post-trade data. The EU’s approach for equity pre-trade data is less ambitious due to less observed issues compared to equity post-trade data, but the EU approach might become more top-down in the future. To support these findings, the section below provides a summary of the EU approach for publication and consolidation arrangements under the ISD, MiFID I, and MiFID II. The summary is followed by the consequences of the regimes.