TP ICAP’s decision to use the Bloomberg Entity Exchange to help clients of its broking businesses register on new trading venues under Markets in Financial Instruments Directive II (MiFID II) was made after considering several Know your Customer (KYC) solutions and is expected to simplify the repapering process for clients ahead of the January 3, 2018 MiFID II deadline. For Bloomberg, the TP ICAP use case of Entity Exchange is significant in its application to emerging regulation.
TP ICAP broking businesses including Tullett Prebon and ICAP have applied to operate Organised Trading Facilities (OTFs) under MiFID II. This requires them to collect information about venue users and transactions, and distribute information including risk disclosures to venue users. Bloomberg Entity Exchange matches these requirements with a web-based electronic platform that centralises the exchange of information and documentation required by TP ICAP to offer execution services to its customers in compliance with MiFID II.
Nicolas Breteau, chief executive at TP ICAP Global Broking, says partnering with Bloomberg will help its clients “understand what the new rules will mean to their trading relationships, especially around trade execution, reporting and transparency”.
Dan Matthies, global head of Bloomberg Entity Exchange, says the platform is well suited to handling the documentation challenges of MiFID II, which include the exchange of millions of pieces of paper. Entity Exchange applies data science to documents, taking resulting data points and using them to auto-match documents to requests. The collection of data points also allows auto-population of standard or custom digitised forms or questionnaires.
Beyond TP ICAP’s use of Entity Exchange to meet MiFID II compliance, Matthies says: “Given Entity Exchange’s flexible and policy agnostic approach to documents and data, we are seeing a number of different use cases across the regulatory compliance space globally. KYC information, regulatory driven affirmations and questionnaires are permissioned in an encrypted environment with a full audit trail and version control. As a result, legal, compliance, operations and investor relations professionals are using Entity Exchange to deliver, manage and track legal, regulatory and operational data and documents as a matter of safe and sound practices and efficient compliance.”