ESMA elaborates on technology criteria Consolidated Tape Providers will be expected to meet

ESMA’s consultation paper on technical standards related to the assessment and selection of a Consolidated Tape Provider for the EU is 233 pages long! Here is a one pager outlining ESMA’s technology considerations that a CTP will require.

ESMA breaks down the assessment of CTPs in their selection criteria into data Input and Output requirements.

Data Input
For data input, data from APAs and Trading Venues to the CTP, they highlight four key areas; Performance, Reliability, Security and Compatibility – each of which is broken down into sub categories.

Data Output
Regarding data output, data the CTP publishes to consumers of the tape, they point to real time system monitoring, data reconciliation, feedback channels from users and performance statistics/ incident reports.

Clock Synchronisation
ESMA dedicates an entire section of the paper to Clock Synchronisation. This too seems standard practise, but again there are complexities. For more detail around how TransFICC already complies with even more stringent Mifid requirements on clock synchronisation click below - blog by Judd Gaddie here:

https://wireddevelopment.blogspot.com/2016/08/obtaining-time-in-java-with-nano-second.html

Although these requirements look fairly industry standard and further clarification on some issues is needed over the coming months, these technology requirements can be quite complex and require significant resource to build from scratch.

TransFICC supports almost all of them today in live production systems which deliver post trade messaging from all major venues in the EU.

ESMA is looking for feedback and responses to the consultation paper to submit final draft technical standards to the European Commission by year end. In addition to technology considerations, the paper covers revenue redistribution for the equity tape, authorisation and organisational requirements for Data Reporting Service Providers and further detail of the assessment criteria for the CTP selection procedure.