FCA Reveals Plans to Streamline Transaction Reporting Requirements

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The UK Financial Conduct Authority (FCA) has unveiled plans to simplify transaction-reporting obligations for firms in a bid to reduce compliance burdens and improve data quality, according to Finextra. 

Under the proposals, reporting of foreign-exchange derivatives would be removed altogether, and firms would no longer need to submit reports for around six million financial instruments, including certain equities, bonds, and derivatives traded exclusively on EU venues. 

The FCA also plans to shorten the retrospective correction window for historic reporting errors from five years to three. This change is expected to cut the volume of resubmissions by a third. 

The FCA estimates these changes could save industry participants around £100 million ($131 million) per year, lowering the cost of processing over seven billion transaction reports annually from nearly £500 million ($655 million) to approximately £400 million ($524 million). 

According to Therese Chambers, Joint Executive Director of Enforcement and Market Oversight at the FCA: “Reducing costs while improving the quality of the data we receive is a no-brainer. It means we can support growth and receive better market intelligence to act on.”

Buy-side investors had also sought full exclusion from the reporting rules, as seen in the US and Japan. However, the FCA declined, citing the UK’s “international nature” and the fact that more than half of transactions are executed by buy-side firms.