Changes from report parliamentary committee draft to plenary report

Added(c) derivatives.

AddedEach selection procedure shall be initiated no later than six months following the initiation of the preceding one.

Added2. For each of the asset classes referred to in paragraph 1, ESMA shallselect the applicant for subsequent authorisation on the basis of the following criteria:

Added(a) the technical ability of the applicants to provide a resilient consolidated tape throughout the Union;

Added(b) the capacity of the applicants to comply with the organisational requirements laid down in Article 27h;

Added(ba) the ability to receive, consolidate and disseminate pre-trade and post-trade market data for shares and ETFs, up to the first five layers of the order books, and post-trade data for bonds and derivatives;

Added(c) the adequacy of the governance structure of the applicants;

Added(d) the adequacy of the speed at which the applicants can disseminate core market data;

Added(e) the appropriateness of the applicant’s methods and arrangements to ensure data quality;

Added(f) the reasonable level of total expenditure needed by the applicants to develop the consolidated tape and the costs of operating the consolidated tape on an ongoing basis;

Added(g) the level of the fees that the applicant intends to charge to the different types of users of the core market data, their proportionality to the costs incurred for running the CTP, the simplicity of its fee and licensing models, and the applicant’s ultimate ability to cover costs and generate a reasonable margin in line with the requirements of Article 13;

Added(h) the possibility of the applicants to use modern interface technologies for the provision of the core market data and for connectivity;

Added(i) the appropriateness of the arrangements in place to preserve records for the purposes of Article 27ha(3);

Added(j) the ability to ensure regularity, resilience and business continuity, and the process the applicants intend to put in place to mitigate and address cyber-risk;

Added(k) the process the applicants intend to put in place to mitigate the energy consumption generated by the storage of data.

Added3. For the selection of the CTP for shares and ETFs, in addition to the criteria in paragraph 2 of this Article, ESMA shall consider the revenue redistribution scheme that the applicant intends to put in place in relation to each market data contributor, and in particular the formula applicable to smaller regulated markets and SME growth markets that decide to provide their market data to the CTP, in accordance with Article 22a(1c).

Added4. Within six months from the initiation of the selection procedure referred to in paragraph 1, ESMA shall adopt a fully reasoned decision selecting entities deemed suitable for operating the consolidated tapes and inviting them to submit an application for authorisation.

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Added(15a) the following Article is inserted:

Added‘Article 27db

AddedProcess for the authorisation of CTPs

Added1. The application referred to in Article 27da shall provide all the information necessary to enable ESMA to confirm that the applicant has put in place, at the time of initial authorisation, all the necessary arrangements to fulfil the criteria set out in Article 27da(2) and to comply with the organisational requirements set out in Article 27h.

AddedESMA shall assess whether the application for authorisation is complete within 20 working days of its receipt.

AddedWhere the application is not complete, ESMA shall set a deadline by which the applicant is to provide additional information.

AddedAfter assessing the application as complete, ESMA shall notify the CTP accordingly. Within three months from the receipt of a complete application, ESMA shall assess the compliance of the applicant with this Title. It shall adopt a fully reasoned decision granting or refusing authorisation and shall notify the applicant accordingly within five working days of the date of adoption of such reasoned decision. Such reasoned decision shall specify the conditions under which the CTP shall operate and, in particular, the level of fees referred to in Article 27da(2)(g), as indicated by the applicant, and, for shares, the level of the participation as referred to in Article 27h(1), point (c).

Added2. Once authorised by ESMA, the CTP shall be granted a transition period of three months to ensure the operational and technical set-up in accordance with the respective regulatory technical standards before the consolidated tape begins to operate. During this transition period, the CTP shall allow data providers to connect and test the connection to the CTP for data contribution.

Added3. The selected CTPs shall comply at all times with the organisational requirements set out in Article 27h and with the conditions set out in the decision of ESMA authorising the CTP referred to in paragraph 1, fourth subparagraph of this Article. A CTP that is no longer able to comply with those requirements and conditions, including the requirements and conditions on system disruptions and intrusions, shall inform ESMA thereof without undue delay.

Added4. The withdrawal of the authorisation referred to in Article 27e shall only take effect when a new CTP has been selected and authorised in accordance with Articles 27da and 27db.

Added5. ESMA shall develop draft regulatory technical standards to determine:

Added(a) the information to be provided under paragraph 1, including the programme of operations;

Added(b) the information included in the notifications under Article 27f(2).

AddedPower is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.

Added6. ESMA shall develop draft implementing technical standards to determine standard forms, templates and procedures for the notification or provision of information provided for in paragraph 1 of this Article and in Article 27f(2).

AddedPower is conferred on the Commission to adopt the implementing technical standards referred to in the first subparagraph in accordance with Article 15 of Regulation (EU) No 1095/2010.

Added(15b) In Article 27e, the following paragraph is inserted:

Added‘2a. A data reporting services provider from which registration has been withdrawn shall ensure orderly substitution, including the transfer of data to other data reporting services providers, the due notice to its clients and the redirection of reporting flows to other data reporting services providers prior to the withdrawal.’;

Added(15c) Article 27f is amended as follows:

Added(a) in paragraph 1, the third subparagraph is replaced by the following:

Added‘Where a market operator seeks authorisation to operate an APA or an ARM pursuant to Article 27c, where if it fulfils the criteria for derogation of ESMA supervision and where the members of the management body of the APA, or the ARM are the same as the members of the management body of the regulated market, those persons are deemed to comply with the requirements laid down in the first subparagraph.’;

Added(b) paragraph 4 is replaced by the following:

Added‘4. ESMA, or the national competent authority where relevant, shall refuse or withdraw authorisation if it is not satisfied that the person or persons who effectively direct the business of the data reporting services provider are of sufficiently good repute, or if there are objective and demonstrable grounds for believing that proposed changes to the management body of the data reporting services provider pose a threat to its sound and prudent management and to the adequate consideration of the interest of its clients and the integrity of the market.’;

Added(c) the following paragraphs are inserted:

Added‘4a. An APA shall have objective, non-discriminatory and publicly disclosed requirements for access to its services by undertakings that are subject to the transparency obligations under Article 20(1) and Article 21(1).

AddedAn APA shall publicly disclose the prices and fees associated with the data reporting services provided under this Regulation. It shall disclose separately the prices and fees of each service provided, including discounts and rebates and the conditions to benefit from those reductions. It shall allow reporting entities to access specific services separately.

Added4b. APAs shall keep and preserve records relating to their business for at least five years. The information concerning the first two years shall be kept in an easily accessible place, and the APA shall provide such records to ESMA without delay upon request.’;

Added(16) Article 27h is replaced by the following:

Added‘Article 27h

AddedOrganisational requirements for CTPs

Added1. CTPs shall, in accordance with the conditions for authorisation referred to in Article 27da:

Added(a) collect all market data provided through contributions in relation to the asset class for which they are authorised;

Added(b) collect monthly subscription fees from users, while providing free access to retail investors, academics and civil society organisations using the data for research purposes as well as public authorities for the execution of regulatory and supervisory competences;

Added(c) in the case of market data concerning shares and ETFs, redistribute part of their revenues for the purposes of covering the cost related to mandatory contribution and, when applicable, of ensuring a reasonable level of participation for regulated markets and SME Growth Markets, in particular smaller regulated markets, in the revenue generated by the consolidated tape, in accordance with Article 27da(3);

Added(d) make consolidated core market data, for the provision of which the CTP is selected in accordance with Article 27da, available in accordance with the data quality requirements set out in Article 22b to users into a continuous electronic data stream on non-discriminatory terms as close to real time as technically possible;

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Added(f) ensure that the consolidated core market data is easily accessible, machine readable and utilisable for all users, including retail investors.

Added(fa) ensure that the use of core market data is strictly limited to the collection, consolidation, and redistribution of such data; any additional value-added services shall be subject to additional licensing terms set out by each market data contributor;

Added(fb) have systems in place that can effectively check trade reports for completeness, identify omissions and obvious errors, and request the re-transmission of erroneous reports.

Added▌For the purposes of point (c), the level of revenue redistributed to each market data contributor shall take into account the contribution to the price formation process of the data provided to the CTP by that market data contributor in accordance with Article 22a.