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Thomson Reuters to Open Up RICs for Consolidated Feeds Under EC Settlement

The European Commission has ended its lengthy enquiry into Thomson Reuters’ licensing policies for Reuters Instrument Codes (RICs), accepting commitments from the company that will create a more fluid market for real-time consolidated data feeds. The deal creates a new environment for Thomson Reuters as it finds itself competing in an increasingly open market.

The company welcomed the Commission’s decision – perhaps on the basis of the end of the enquiry rather than the commitments it must stick to – and was quick to point out that its new licensing commitment is consistent with the move it made in June 2012 to make RICS available foruse with non-real-time information in client and non-client financial institutions’ trade processing systems. At that time, Thomson Reuters’ then-Enterprise content chief Gerry Buggy, described the move as the “first step in supporting the financial community’s symbology needs across all parts of the trading life cycle through our evolving symbology services.”

The Commission made its decision to end the enquiry after accepting commitments put forward by Thomson Reuters in May 2012 that were then market tested with a third-party comment period running until August 2012. The commitments have been made legally binding, with the key outcomes being that Thomson Reuters’ customers can continue to use RICs in real-time applications after they have switched to an alternative real-time consolidated data feed provider and use RICs in combination with the alternative provider’s data.

Commenting on the Commission’s decision, Commission vice president of competition policy, Joaquin Almunia, says: “Information plays a key role in ensuring that financial markets operate in a healthy and efficient way. In order to correctly assess investment opportunities, market participants need to access accurate and timely financial data, for example through consolidated real-time data feeds. The commitments offered by Thomson Reuters will enhance competition in this market. Financial institutions that use RICs will now be able to switch to alternative providers more easily.”

Responding to the Commission’s decision to adopt Thomson Reuters’ commitments, David Craig, president of Financial & Risk at the company, says: “Following a detailed examination of the facts, the Commission accepted our proposal without any finding of infringement of EU competition law by Thomson Reuters. We now look forward to continuing to work with our customers to bring world-class, real-time data feed and symbology solutions to market.”

In essence, Thomson Reuters’ commitments allow customers to license additional RICs usage rights for the purpose of switching data vendors and to use RICs for retrieving data from other providers against a monthly licence fee. The company will also provide customers with the necessary information to map RICs to alternative symbology, and allow third parties to develop and maintain switching tools that allow RICs and rival services to interoperate by mapping RICs to the financial identifiers of other data feed providers. Third-party developers can use and keep RICs in their switching tools on payment of a monthly licence.

If the Commission’s decision is favourable for users of consolidated real-time data feeds, it must also be of great interest to their suppliers, with 2013 promising to be both a battleground and a peace mission as suppliers struggle to maintain market share while responding to market demand for more open symbology solutions.

Source: Reference Data Review, 20.12.2012

Filed under: Data Management, Data Vendor, Reference Data, , , , , , , ,

Thomson Reuters Opens RICs to all with Non-Realtime License

Thomson Reuters is taking a step toward answering client calls for more open access to its Reuters Instrument Code (RIC) symbology. The company is making RICs available for use with non-real-time information in client and non-client financial institutions’ trade processing systems.

Enterprise content chief Gerry Buggy, who has spearheaded Thomson Reuters’ response to the EC anti-competition complaint, the new facility is the “first step in supporting the financial community’s symbology needs across all parts of the trading life cycle through our evolving symbology services.”

The move comes in the wake of the EC investigation and subsequent complaint into the use of RICs in real-time consolidated data feeds. In response to that complaint, many financial services practitioners have called for more open access to the RIC, which is entrenched in many firms front-, middle- and back-office trading and trade processing systems.

According to Jason du Preez, Global Business Manager, Enterprise Platform, at Thomson Reuters, the latest initiative “has nothing to do with the EC investigation. The EC is focused on use of RICs for accessing real-time information, while the new licences are focused at firms looking to trade with the RIC or use the RIC to access non-real-time information.”

Du Preez says that latest move means that “any market participant can buy a license that will allow them to trade using the RIC. This will allow the use of the RIC for pre- and post-trade activities, and the right to redistribute RICS in this regard.”

The new RICs arrangement will allow market participants to use and cross-reference the RIC symbol for trade activities. As such, it can be used to facilitate the advertisement of liquidity, acceptance of trade flow and execution of post trade activities with the RIC symbol as a consistent identifier throughout the process.

Additionally, the service will allow Thomson Reuters pricing and reference data customers to use RICs to reference and retrieve securities data from their securities master databases and navigate to connected content such as legal entity identifier (LEI) information.

Du Preez says that “Firms that purchase reference data from Thomson Reuters will also be granted the right to use the RIC to access any non-real-time information, essentially allowing them to use the RIC to access any content, including third-party party content, held in their securities master databases.”

Thomson Reuters believes the new service will encourage more efficient and reliable capital markets by giving market participants the freedom to use RICs symbols irrespective of whether they use Thomson Reuters enterprise data products.

As part of the latest initiative, the Bats Chi-X Europe exchange has signed up for the service, which will allow it to deploy RICs in the post-trade services it offers.

According to Paul O’Donnell, COO at BATS Chi-X Europe, “Cross-referencing the BATS Chi-X Europe instrument codes with the Thomson Reuters RIC symbols will enable us to reach new market participants as well as improve efficiency and data transparency by facilitating accurate identification of securities on our platform.”

Du Preez says obvious candidates for adopting the new arrangement include “trade hubs, third-party trade/post-trade processing firms or anyone that wants to send, receive or cross reference messages that contain securities identified with a RIC.”

Source: A-Team Reference Data Review 27.06.2012

Filed under: Data Management, Data Vendor, Reference Data, Standards, , , , , , , , , ,

Thomson Reuters fails RIC licensing market test – Symbology

Thomson Reuters has failed to appease EU antitrust bodies over proposed concessions in the way it licenses the proprietary Reuters Instrument Codes.

In 2009 the European Commission opened antitrust proceedings against Thomson Reuters over possible abuse of its dominant market position in the supply of RICs – codes that identify securities and are used by financial institutions to retrieve data from Thomson Reuters’ real-time feeds.The EC argued that the firm could be abusing its dominant position in the market for these consolidated real-time datafeeds by stopping customers from using RICs for retrieving data from alternative providers and mapping them for such a purpose to alternative symbols.

In an attempt to ward off further action by the Commission, the vendor agreed to let customers license RICs for mapping purposes over a five-year period for a monthly fee based on the number of RIC symbols to be used.

However, in a speech in Copenhagen today, EU competition chief Joaquín Almunia, said that a market test of the new measures had failed to deliver a desirable outcome.

“We have now reached a critical stage in this investigation,” said Almunia. “If no effective solution can be agreed upon, then we will have to draw the adequate conclusions.”

The company could face fines of up to 10% of its turnover if it does not offer further concessions to users.

Thomson Reuters’ rival Bloomberg has moved to make its own proprietary symbology available for free to developers and market practitioners.

Filed under: Data Vendor, Market Data, News, Reference Data, , , , , , ,

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