AFM and industry conclude high-level technical principles for a corporate bond consolidated tape

In brief

• High-level technical principles concluded for corporate bond consolidated tape
• Input for principles provided by industry representatives following round table meeting held on 20 April 2022
• Principles provide essential guidance on several key features in creation corporate bond CT

The firms that provided input from the Innovation Hub include Ediphy, Finbourne, Propellant Digital and TransFICC. The Stakeholder Group on the Bond Consolidated Tape includes representatives from buy-side, sell-side, principal trading firms and trading venues. Participants to the proceedings included representatives from AIMA, Bloomberg, BVI, Citadel, DataBP, DWS, EFAMA, FIA EPTA, Flow Traders, ICMA, ING, MarketAxess, Norges Bank and Tradeweb. The European Commission, ESMA and Dutch Ministry of Finance joined the proceedings as observers. The group was chaired in an independent capacity by Alexander Sedgwick representing Abel Noser Solutions.

The principles produced by the roundtable provide essential guidance on several key features in the creation of a corporate bond consolidated tape for Europe. They outline the input standards for trade reporting and clarify the definitions of core data fields ensuring reliable market data. They also describe the basic output standards for the consolidated tape, including how core market data may be made available to end-users and address a variety of use cases for market participants

Most importantly, these principles outline a path forward for the co-legislators working on the MiFIR Review to partner with industry representatives to ensure a solid technical and operational model for a corporate bond consolidated tape in the European Union

Hanzo van Beusekom, Executive Board Member of the AFM

'These high-level technical principles are the result of a constructive dialogue with bond market participants that provided valuable insights on the technical and regulatory barriers hampering the emergence of corporate bond CT in the EU.  The work of the group provided guidance on the need to focus on clear reporting instructions and standards to improve data quality, the need for undisputed and clear reference data, as well as providing the outlines for a CT product that supports use cases for all types of market participants. I believe these principles are extremely valuable for the ongoing negotiations, as well as the technical discussions at ESMA level that will follow after the MiFIR Review is agreed by the co-legislators.'

Alexander Sedgwick, Independent Chair of the AFM Stakeholder Group on the Bond Consolidated Tape and Global Head of Fixed Income at Abel Noser Solutions

'Drafting these technical principles represents an important step forward in delivering a corporate bond consolidated tape in the European Union. I applaud all of the roundtable participants for their valuable and candid input during these discussions. The AFM has performed a valuable service by bringing together a diverse group of stakeholders and documenting an emerging consensus around these important issues. It has truly helped lay the foundation for the delivery of a corporate bond consolidated tape.'

Journalists may contact Maarten Dijksma, AFM spokesperson, on +31 (0)6 11 34 02 81 or at maarten.dijksma@afm.nl.

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