Cost of storage is secondary to the needs of end-users, says CESR

Although the cost of storage and filing of regulated information is an important consideration, the decision on which model of storage to implement should be based on the needs of the end-user and proper fulfilment if the transparency directive should come first, according to the Committee of European Securities Regulators (CESR).

Publishing their final advice to the European Commission (EC) on the storage and filing of regulated information under the transparency directive, due to be implemented by January 20, 2007, CESR did not include a discussion of the estimated costs included in setting up the directive.

More work is needed to classify the model for how information should be stored and what is available. Currently, the CESR is working on how such officially appointed mechanisms (OAMs) should be defined and how they should operate.

This is a major concern in the industry, as few know how to collate and provide required information. “You have to know where your data is first,” said one compliance professional. “It’s spread across different systems. The cost implications could be huge. This is another chunk of operational charges, and along with the Markets in Financial Instruments Directive, could be a hammer blow to firms,” he said.

The CESR said cost will largely depend on the options taken up by individual member states, though it noted that an OAM model that provides a central list and links to each OAM holding information on any given issuer garnered the most support from those consulted.

Click here to see the advice in full on the CESR website.

BaselAlert.com