The UK's Financial Conduct Authority has revealed proposals to establish a consolidated tape in order to offer investors access to "clear and low-cost trading data".
A consolidated tape would combine multiple sources of trading data into a single information stream, which the regulator argues will "increase transparency and access to trading data by lowering its cost and improving data quality".
The FCA has proposed to establish a CT for bonds, in which it says the UK has a leading global market, before expanding to a second CT for equities. It intends to run a tender process to appoint a single CT provider for bonds.
It has said it will consult on "further reforms" to bond and derivative transparency requirements in order to create a "simpler and more effective regime" to enhance the delivery of trade data in UK markets.
The move comes following a study earlier this year that investigated the effectiveness of competition in the wholesale data market, which in turn followed a report that questioned the fairness of the trade data market.
Sarah Pritchard, executive director of markets and executive director of international at the FCA, said: "We are adapting our rules to make sure the UK market works well, providing certainty for firms and so providing a good environment for investment.
"The new consolidated tape will help reduce trading costs, increase transparency and improve data quality.
"Our other measures announced today aim to further support the UK's thriving financial services sector."
Jim Goldie, head of EMEA ETF capital markets at Invesco, said he hoped the UK consolidated tape would include venue attribution after it was left out of the EU's proposals this week.
"Venue attribution is incredibly important to provide transparency to investors around which venues are displaying best execution at a given point in time," he said.
Goldie also said it would be "incredibly important" for ETFs to be included alongside equities in the UK tape, similar to the EU's plans.
"The added transparency a consolidated tape will bring to the UK can only contribute to more robust capital markets via improved transaction cost analysis," Goldie added. "This will help to document best execution, enhance market surveillance, and improve liquidity risk management and portfolio valuation, all of which adds to investor protection."
Nathaniel Lalone, partner at Katten Muchin Rosenman UK, said a functioning consolidated tape "had started to look like the 'white whale' of the MiFID II framework", but the evidence-based, market-aware approach of the FCA had compared "favourably to the horse-trading that has characterised the EU negotiations".
