In its latest blueprint, Nasdaq proposed to modernize the definition of “professional” and “non-professional” users in market data agreements.
Market data fees have differed for various categories of users based on ability to pay for the data (professional versus non-professional), the value they extract from the data (displayed on a screen versus non-displayed usage by a server), and the volume of data they purchase (tiers and enterprise caps).
Nasdaq noted that this distinction complicates market data administration, adds costs and discourages participation in the markets by Main Street investors, and solicited public comment on potential changes. It proposed to clarify the distinction between professional and non-professional investors by:
- Ensuring all Main Street investors are considered Non-Professionals
- Allowing non-financial small businesses to operate as Non-Professionals
- Eliminating compliance liability for distributors for good-faith errors in reporting
- Ensuring Professionals using market data for their own personal brokerage accounts are treated as Non-Professionals
The IIAC submitted comments to Nasdaq that highlighted the issues faced by the industry and provided insight into possible solutions.
For additional information, or if you have any questions, please contact Annie Sinigagliese.