The European Union’s vast over-the-counter derivatives market has long operated within a complex and fragmented data landscape, posing significant challenges to post-trade transparency for all participants. In response to this persistent issue, the European Securities and Markets Authority (ESMA) initiated a selection process to establish a single consolidated tape provider (CTP), a move designed to harmonize data and create a unified, authoritative record for the market. Now, a novel approach has entered this competitive arena, as Etrading Software officially announced its intention to vie for this critical role through a newly formed non-profit entity. This proposal introduces a public-interest utility model into a domain typically dominated by for-profit enterprises, raising fundamental questions about the future of market infrastructure and data governance. The bid aims to directly address the core objectives of the EU’s initiative by promising a resilient, standardized, and reasonably priced data solution.
A New Model for Market Transparency
At the heart of this unconventional bid is Transparent Markets Europe (TME), a new non-profit organization established specifically to operate the consolidated tape. TME, which will be headquartered in Amsterdam, is structured as a public-interest market utility designed to function on a cost-recovery and open-access basis. Critically, the organization will have no shareholders and hold no equity, a framework intended to ensure its neutrality and align its objectives squarely with the needs of the broader market rather than the pursuit of profit. While TME will serve as the official CTP entity, the essential underlying technology and operational infrastructure will be provided by Etrading Software. This deliberate separation of roles combines the public-service ethos of a non-profit with the proven technological capabilities of an established financial technology firm. The core mission is to deliver a single, authoritative record of EU OTC derivatives data while implementing common data standards and maintaining a resilient infrastructure.
The Path to a Unified Data Stream
This strategic move by Etrading Software is set against the backdrop of an important regulatory timeline, with ESMA expected to announce its decision on the CTP selection in early July 2025. The bid’s credibility was substantially bolstered by Etrading Software’s prior success in a similar competitive process. In September 2023, the UK’s Financial Conduct Authority selected the firm to become the CTP for the UK bond market, a service that officially launched on April 22, 2024. This previous appointment demonstrated the viability of its technology and operational model, providing a strong precedent for its EU ambitions. The proposal for the EU derivatives tape represented a significant development in the broader trend toward greater data consolidation and transparency in global financial markets. It introduced a compelling alternative to traditional for-profit models and underscored a growing debate on whether critical market infrastructure should be operated as a public utility to best serve all participants.
