Investment Association calls for Europe to reject Mifid II data pricing rules

The buy-side association has said the provisions have been watered down to the extent that they are "null and void."

The Investment Association, which represents the UK fund and asset manager community, has called for the European Parliament to reject incoming rules on pricing market data.

In a letter to MEPs, the association argues provisions on market data costs and dissemination and data aggregation, set out in Mifid II, “need to be rejected.”

Market participants have grown increasingly frustrated at rising data costs, with many believing that exchanges, which are amongst the biggest vendors of trading data, have been indulging in monopolistic practices, ramping up data fees as well as introducing complex and strict new data licensing measures.

Provisions within Mifid II have attempted to address this, stating that the price for market data has to be set at a “reasonable commercial basis.” It also states that the price of market data should be based on the “cost of producing and disseminating it at a reasonable margin.”

However, the letter from the association says that the provisions “have been watered down to such an extent to make them, in effect, null and void.”

The association also states that the regulation will allow exchanges and trading venues to define what type of clients use their data, and as a result, means “end-users will be beholden to the discretion of individual trading venues across Europe.”

It has called for a “true mandated consolidated tape” provision which would “decrease costs for end-users of the market.