Response to CESR's consultation on possible implementing measures of the Transparency Directive
The Exchange has responded to CESR’s consultation on proposed implementing measures of the Transparency Directive (Part I: Dissemination and storage of regulated information). We believe these implementing measures, in particular regarding information dissemination, are vital to the creation of a single market.
We fully support CESR’s proposals with regards to dissemination – we believe that the system of competing operators is the best practice model for Europe. In the UK the system of competing primary information providers (PIPs) - providing real time, electronic ‘push’ of regulatory information - has worked well since 2001.
Using this method ensures high quality disclosure, which brings with it a number of benefits in terms of orderly markets and efficient price formation, in particular:
investors will benefit from increased confidence and lower risk;
better and more transparent disclosure will increase the attractiveness of public equity markets, lowering the cost of capital for users;
- a reduction in the scope for market abuse;
- a strengthening of the share price formation process; and
- retail investors across Europe will receive the same information as market professionals, on all companies, at the time it is released.
We also welcome the development of a central storage mechanism. This will enhance transparency of information across the EU and facilitate cross-border investment.
We believe that this area needs to be subject to further industry debate. However, ideally we believe that there should be one pan-European central storage mechanism rather than a model of numerous competing providers or one mechanism in each Member State. This should be the most efficient model and be able to take advantage of economies of scale. Further, we believe that a system operated by competent authorities - along the lines of EDGAR in the United States - is the most preferable model.
The original consultation paper can be found at: www.cesr-eu.org