Endorsement of Market Data sharing by CySEC

Today, the Cyprus securities and exchange commission issued a circular to inform Cyprus Investment Firms (‘the CIFs’) about developments regarding the rules of using market data. The report, signed by CySEC’s Chair Demetra Kalogerou explained the circumstances under which market data can be used and how. It is explained that Investment firms in Cyprus are now permitted to render “investment services, and/or provide market data to their clients, only if they are authorized to do so by the person who has the intellectual property rights of the market data, and sign a direct agreement with this person”.

A succinct description was given, using Euronext as an example.The following cases of market data usage require the authorization of Euronext and the signing of an agreement with it:

i. Use of the trademarks of Euronext (changing the instrument name still requires an authorization).

ii. Redistribution of market data to clients (e.g. create and redistribute products which incorporate the AEX, BEL 20®, CAC 40® and/or PSI 20® Index/Option/Future price).

iii. Offering binary options, CFDs or any other instrument on stocks listed on any of the Euronext Markets to clients such as Alcatel-Lucent, AXA, Total or Vivendi.

iv. Market data is the price and trade-related data for a financial instrument reported by a trading venue such as a stock exchange.iv. Redistribution of ‘Raw’ Market Data and/or Derived data.

v. Redistribution of Real-Time and/or Delayed Market data.

The above scenario is subject to a direct agreement with Euronext or any other market data provider, irrespective of the level of regularity with which the market data are distributed to clients (e.g. only when the binary option expires) as CySEC promotes information sharing with the endorsement of Market Data sharing.

The report also stated that; Cyprus Investment Firms (CIFs) are requested to review their processes established in relation to market data usage and ensure that all necessary actions will be taken. These process and necessary actions entails; obtaining an authorisation from as well as signing an agreement with the righteous person who has intellectual property rights of the market data. This is required, in order to become compliant with respect to the usages market data, when providing investment services.

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