UK MiFID: FCA consult on income sharing by equity CTP and incident reporting for all CTPs

The FCA has published a consultation paper (CP26/39) on how equity consolidated tape providers (CTP) could share income with data contributors, and on enhanced operational incident reporting requirements for all CTPs. The consultation closes on 17 December 2026.

Proposals at a glance

The FCA propose an income distribution model for the UK equity CTP under which all UK trading venues and Approved Publication Arrangements (APAs) would be eligible to receive a share of the equity CTP’s income. The amount each trading venue or APA would receive would be determined by the relative value of the data they submit to the equity CT. Under the proposed model, half of the shared income would be reserved for central limit order book (CLOB) or periodic auction trading systems, which will provide pre‑trade data to the UK equity CTP. There would also be a greater weighting for trades executed on smaller trading venues.

The FCA also propose to apply enhanced operational incident reporting requirements under SUP 15.18 to all CTPs.

More detail on CTP income sharing

Income sharing from the UK equity CTP aims to incentivise data contributors and the equity CTP in implementing a high-quality equity CT. Key points from the FCA proposals include the following:

• The income sharing model should be simple to minimise costs or uncertainty for the CTP provider or data contributors.
   
• The FCA is proposing that all venues and APAs contributing to the CTP should be eligible to receive an income share. But a greater share of the income will be reserved for CLOBs and period auction systems that provide pre-trade data to the CTP, reflecting the additional operational complexity for these venues and the value of executable lit liquidity to UK equity markets. 
   
  • 50% of the income to be shared would be split between venues and APAs for their contribution of post-trade data, depending on their share of total value of all trades submitted to the equity CTP. Non-price forming trades (flagged NPFT, until this flag is deleted as currently intended per CP26/30) and trades not contributing to price formation (flagged TNCP) will be excluded. 
     
  • The remaining 50% of the income to be shared will be split between trading venues operating CLOB and periodic auction trading systems, depending on their proportion of the total value of all trades actually executed on (rather than quotes submitted by) CLOB and periodic auction trading systems submitted to the equity CT in the relevant period (again excluding NPFT and TNCP trades). 
     
  • The FCA has decided to use the value of post‑trade (rather than pre-trade) data as the metric for distributing income from the CTP because it is (amongst other things) more likely to represent executable liquidity.
     
  • The FCA proposes to give a higher income share to smaller venues (those whose trades account for less than 5% of the value of trades (excluding NPFT and TNCP trades) provided to the UK equity CT). The FCA has indicated that this would capture all current UK SME growth markets. The smaller venue weighting is intended to incentivise new venues to contribute to the equity CTP at a time when they are likely operating at smaller profit margins. It could also support access to diverse trading opportunities and support opportunities for smaller UK companies to raise capital. The FCA proposes a weighting of 4.5 for smaller venue trades (which is aligned with the EU small venue weighting). This means that that (within the 50/50 split for post-trade data providers and CLOB/ periodic auctions described above) the value of trades reported by small venues would be multiplied by 4.5.
     
  • The FCA will review the economic model (including income sharing) of the equity CTP as part of its post-implementation review starting two years after go-live of the equity CTP. 
     
• Interestingly, under the FCA proposals, any income share in respect of SI post- and pre-trade data would be received by APAs (with the FCA anticipating that most SI transparency data would be submitted to the CTP via APAs). As above, the relevant income share would be calculated by reference to SI post-trade data, even if the income share related to SI pre-trade data (which FCA CP26/30 proposed to include in the equity CTP).
   
• The CP includes the FCA’s thoughts on how the future UK equity CTP could operationalise an income distribution models.
   
  • This includes how the CTP would identify / verify whether trades were executed on lit venues (CLOB / periodic auction systems) either through segment MICs and FIX MMT codes (the FCA’s preferred method) or through RTS 1 post-trade flags (which the FCA has indicated would include trades executed via RFQ and other systems, rather than just CLOB / periodic auction trades).
     
  • The CTP would need to calculate the value traded in order to identify different data contributors’ income share. In this context, the CP considers how the CTP would treat trades whose price is reported in different formats (such as non-monetary values and non-sterling currencies).
     
• The final FCA rules for the equity CTP (CP26/31) include a requirement for the equity CTP to set an appropriate frequency to measure income sharing), provided that this period must not exceed 12 months. CP 25/39 now proposes a timeline for providing income share statements to data contributors, requirements for any related dispute resolution and a 6 months’ backstop (after the end of the calculation period) for making final income payments to data contributors. 
   
• In order to support data quality, the FCA proposes that the CTP would (working with its consultative committee and consulting CTP users) put in place a framework to reduce payments to data contributors where they:
  • repeatedly fail to provide the required data or provide incomplete data,
  • breach the daily 95% confidence interval for latency, 
  • fail to comply with transmission protocols, or 
  • no longer meet clock synchronisation requirements. 
     
• Income share would not be reduced in extenuating circumstances (which could include heightened market volatility), where the relevant data quality issue could not have been reasonably foreseen and avoided by taking reasonable precautions.
   
• The CTP will have to notify data contributors of identified quality issues and follow a specified process before reducing the contributor’s income share. 

More detail on operational incident reporting

The FCA wants to apply the operational incident reporting requirements in SUP18 to all UK CTPs. 

These build on the final rules and guidance setting out requirements for reporting operational incidents in PS26/2, which enter into force on 18 March 2027. Given the key role CTPs are expected to have in UK markets, the FCA proposal would make CTPs subject to the enhanced (rather than standard) incident reporting requirements. The FCA’s finalised guidance on operational incident reporting (FG26/3) will also apply to CTPs.

These reporting requirements would apply in addition to the operational resilience and reporting requirements (in MAR 9.2B) and the requirements on material third party reporting (in SUP 15.19 and SUP 16.33) which are already applied to the UK bond and equity CTPs. To avoid duplicative reporting, the FCA has provided that, where an incident meets the threshold and is reported by a CTP under SUP 15.18, it does not have to provide a report under MAR 9.2B as well. 

The FCA has added a new requirement in MAR 9 requiring CTPs to notify the FCA where it is unable to provide the CTP service within normal hours of operation (whether or not the incident is reported under SUP 15.18).

Next steps

The FCA explains that there are two key stages for implementing income sharing arrangements:

• The FCA will confirm the metrics and percentage of income to be shared by the equity CTP to data contributors in a feedback statement in early 2027. This will then be specified in the concession agreement with the appointed equity CTP.
   
• The FCA expects to publish a policy statement on how that share of income is to be split among data contributors in spring 2027, following the consultation in this CP26/39 (closing on 17 December 2026). 

In parallel, by early 2027, the FCA plan to publish:

• a separate PS confirming final rules on the inclusion of SI quotes in the equity CT (as previously consulted on in FCA CP26/31, see this client note); and
   
• key procurement documents, notably a Tender Notice, Invitation to Tender and draft Concession Agreement.

Following these publications and the procurement process, the FCA intend for the first UK equity CTP to start operating in 2027 or early 2028.

Documents

The FCA’s press release is here. 

FCA CP26/39 is here. 

Our earlier client note on the FCA’s equity markets package is here. The package includes findings from the FCA analysis of UK equity markets and a CP on equity transparency (CP26/30), as well as final rules on the UK equity CTP, a CP on inclusion of SI quotes in the UK equity CTP and a call for inputs on CTP income sharing (CP26/31). 

Our earlier blog post on operational incident reporting (PS26/2) is here.