FCA emphasizes the need for more competition in the markets for wholesale data.

The results of the FCA's extensive investigation of the wholesale data market, which concentrated on the markets for credit ratings data, benchmarks, and vendor services of market data, have been made public.

Tyree Schoen

March 01, 2024

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Although the FCA decided against taking extensive regulatory action because of the possibility of unforeseen effects that could damage the quality and availability of data, which is an essential resource for investors worldwide, the agency has identified a number of areas where competition could be greatly enhanced.

The study's findings suggest that consumers may pay more for data than they would in a more competitive market due to the level of competition currently present in these marketplaces. This issue is especially urgent because such data is essential to the financial sector's ability to make wise investment decisions.

The FCA has put forth steps to make sure wholesale data is delivered in a fair, reasonable, and transparent manner in an effort to address these issues. This policy is a component of the regulator's larger plan to "repeal and replace" absorbed EU law, strengthening the UK's position as a leading international financial centre that promotes investment, innovation, and long-term growth.

The FCA's Executive Director of Consumers and Competition, Sheldon Mills, emphasized the significance of easily available and high-quality wholesale data for the effectiveness of financial markets. According to Mills, "the availability and quality of wholesale data are essential to the operation of the wholesale financial markets." "Our market study found that firms can access the data they need to make effective investment decisions," he emphasized further. We don't think there is a strong enough argument for major interventions. We will, however, look for ways to encourage the fair, reasonable, and transparent provision of wholesale data.

Using its authority under the Competition Act to resolve any such issues, the FCA will continue to closely examine claims of anti-competitive behavior across all markets, including wholesale data markets, as part of its commitment to promoting a fair and competitive environment.