Recommendation 6

The Sub-Committee remains sceptical that a government-approved monopoly for providing data to market participants through a consolidated tape is good for competition. Once a monopoly were granted, the incumbent would have little incentive to reduce costs or to innovate. Given the claimed benefits that a consolidated tape would provide to market participants, and the widespread consensus within the market that these benefits do exist, it is not unreasonable to expect the financial markets of the UK to be able to create their own conditions for such a tape to emerge without the regulator granting a monopoly. The Sub-Committee’s preference would Edinburgh Reforms One Year On: Has Anything Changed? 27 have been that market forces created a consolidated tape, therefore the Government and regulators should continue to monitor the impact on market forces of the new tape.