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Regulation and Compliance > Federal Regulation > SEC

SIFMA Challenges SEC

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The Securities Industry and Financial Markets Association (SIFMA), is challenging the SEC to declare a moratorium on decisions allowing exchanges to charge higher fees for market data, “until the SEC is able to address the fundamental legal and policy issues created by for-profit exchanges,” according to an announcement January 19 from SFIMA. Citing “a matter of investor protection,” SIFMA Co-CEO Marc Lackritz says, “The SEC cannot simply ignore the conflicts of interest inherent in today’s for-profit exchanges,” and added, “The exchanges’ unique regulatory status allows them to profit from their market data without the threat of competition, but this conflicts with their congressional mandate to promote transparency.”

Broker/dealers who are by law compelled to provide their quote and trade data to the appropriate exchanges for dissemination to the public, and the other information providers that carry real-time market data for public subscribers via the internet and other online systems, are now facing hikes in what the NYSEArca charges them to receive the market data that feeds information sources like and trading systems, and real-time quote displays. These new fees could affect broker/dealers, advisors and, indirectly, the investing public.

The SIFMA move comes after a petition from the internet trade group, NetCoalition was granted unanimously by SEC on December 27 to review the Commission’s prior approval of SR-NYSEArca-2006-21, which could result in higher fees paid by internet information providers to the exchanges for market data carried on the internet to the public.