The FIX Trading Community, the industry association that manages the world’s trading language, the FIX Protocol, has called for changes to UK financial regulation as part of its responses to FCA consultations on the UK consolidated tape (CP25/31), and transaction reporting (CP25/32).
Executive Director Jim Kaye said both consultations highlighted concerns with post-trade transparency that, if addressed, would improve UK market data and allow investors to more confidently engage with UK-based liquidity.
“FIX has long been of the view that the UK could benefit from harmonising more closely with EU reporting rules, to reduce complexity and improve efficiency, and reduce the reporting burden,” he said. “These two consultations represent an excellent opportunity to move UK markets in this direction.”
The UK consolidated tape for equities, which will be introduced in 2027, will deliver better access to UK market data. FIX made a number of recommendations around the framework of the tape, aiming to address regulatory gaps, improve clarity around compliance, and remove post-Brexit duplicative reporting. They include:
- Aligning the post trade transparency exemptions currently applicable to off-venue activity to apply to equivalent off-book on-exchange trades.
- Remove the requirement to report, in the UK, trades that have already been reported by an EU APA.
- adding disclosure of trade execution methodology (manual versus automated) through FIX field ExecMethod(2405) for all off-venue trade reports.
- Clarify via regulatory guidelines that when chains of orders are involved in a trade, the trade report should be performed by either the executing counterparty or its direct counterparty.
- Clarify via regulatory guidelines that when reporting an off-book cross-border transaction, the trade report should be performed by the first investment firm to receive the trade within the UK.
- To have a single consolidated tape provider to ensure a single source of truth.
With regard to transaction reporting, the FCA consultation proposed changes to “reduce the regulatory burden on firms, support sustained economic growth in the UK, enhance our ability to fight financial crime and protect market integrity.” Mr Kaye noted that FIX’s recommendations focused on simplifying reporting, and included:
- Harmonising and aligning the rules with EU post-trade reporting rules.
- Clarifying single-sided and conditional single-side reporting with respect to data sharing, data repair responsibilities, and scenarios involving multiple intermediaries.
- Ensuring pragmatic approaches to data sourcing and identifiers – ie using Legal Entity Identifiers for trusts, and the FCA’s Financial Instrument Reference Data System (FIRDS) as a golden source – and addressing data quality issues with CFI codes.
- Removing RTS 22 fields while ensuring any data used for post-trade transparency is preserved.
- Ensuring unintended consequences of scope changes, such as removing instruments, fields or reporting oblications, do not complicate reporting logic or erode post-trade data quality.
- Recognising that some firms’ transaction reporting systems may not currently encompass proposed data points such as DEA indicators, and that upgrades will create additional work.
The FIX Trading Community is an independent global community where capital markets firms come together to solve common issues and shape the evolution of capital markets. FIX groups in over 60 countries are working on a range of global issues including digital assets; reference data; carbon trading; AI; algo trading; FICC and ETFs, while country and regional committees work together to manage local regulation and market structure matters.
