"To date the industry has already created a number of consolidated tapes, but the absence of any universal standard has stifled widespread acceptance or uptake," said Stuart Adams, FPL's regional director, EMEA.
FIX Protocol Limited, the standards body for securities messaging, has set out a proposal for the establishment of a governance body and the standards setting process that it says will be necessary to develop a European consolidated tape.
According to the document submitted by FPL, its own professional staff would be engaged to support and drive the activities of the CTDA, however it notes that the proposed structure does not presume that FPL would be the body to run the consolidated tape. Adopting the structure would be advantageous, suggests FPL, inasmuch as it would ensure the correct governance would be in place regardless of the party selected to manage it.
FPL said strong governance would be needed by the CTDA to cope with potentially contentious issues arising from CESR's proposal, such as the tape being available "at a reasonable cost", "in as low latency a form as is reasonably possible" and that the "operator of the consolidated tape would be responsible for the detection of possible multiple publication".
FPL has previously indicated a willingness to play a role in the creation of the consolidated tape, but emphasising that its precise nature would depend on FPL's members.
While some data vendors have created consolidated tapes, a standardised, cost-effective solution has not yet materialised.
FIX Protocol Limited (FPL), the organisation responsible for the FIX financial messaging standard, claims it is well placed to undertake the technical implementation of a consolidated tape in Europe, but some observers still expect the final solution to be mandated by regulators.
"We are looking to play a role in the European consolidated tape, but ultimately it will be up to our members to decide what this role will be."
To clearly define the challenge faced by for potential data consolidators like FIX, CESR has proposed a list of pre-conditions for producing a consolidated tape: the creation of approved publication arrangements (APAs), entities that are required to clean and validate data to enable easier consolidation; the availability of market data at a reasonable cost and on an unbundled basis; and the ability of a consolidated tape operator to make data available at low latency.
"There needs to be aggressive regulation governing the quality of data that is scrubbed and validated by APAs to facilitate the effective creation of a consolidated tape," says Wood.