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UK Market Transparency: FCA Launches 2027 Trade Tape
19 Nov
Summary
- FCA's equity trade tape for market data will launch by 2027.
- The tape aims to improve liquidity perception and support listings.
- Consultation on the tape's design and scope is now underway.
The Financial Conduct Authority (FCA) has announced that its new consolidated tape for equity trades will be launched by 2027. This initiative is designed to offer a more transparent view of liquidity across UK equity markets. The regulator has initiated a consultation to determine the precise design and scope of this system, seeking input on including post-trade data and attributed best bid and offer prices from various UK trading venues.
The FCA anticipates that this enhanced data transparency will help address the perception that British markets are less liquid compared to international counterparts. By providing a clearer picture of total market liquidity, the consolidated tape aims to support the UK's appeal for companies looking to list and for investors making trading decisions. This comes amid concerns about companies delisting and a lack of new initial public offerings in recent years.
While the U.S. has long-established market data aggregation, and the EU is set to select a provider for its equities tape, the UK's move is seen as a significant step. Industry reactions have been largely positive, with some expressing that the tape will bring much-needed transparency and aid in attracting capital. The FCA plans to review the tape's effectiveness after two years of operation.
