EU executive to shine light on share trading costs

NICE, France, Sept 12 (Reuters) - The European Commission will publish how much each clearing and settlement house charges for cross-border share trades in a bid to drive down prices, a top official at the EU executive said on Friday.

“We want, by the end of the year, to post the real comparable prices on our website so the whole market can see who is paying what in which market,” said David Wright, deputy head of the Commission’s internal market unit.

“We think that will force and help create pressure for further change,” Wright told a financial services conference.

The Commission has cajoled the sector to sign up to a code of conduct in a bid to drive down the cost of clearing and settling cross-border trades, still at four to 10 times the cost of a domestic trade.

But Brussels is coming under fire for the code’s failure so far to allow any clearing or settlement house to hook up with a peer so customers have a choice of provider without having to install extra plumbing.

“There is a lot of foot dragging and not enough progress. We really do need to get on with it,” said Robert Wigley, chairman of Merrill Lynch International.

There have been more than 80 “interconnectivity” applications but none is live as some operators accuse peers of hiding behind local rules to the frustration of users who had hoped for cheaper prices by now.

“There has been no enforcement of timetables,” said Chris Tupker, chairman of clearing house LCH.Clearnet, which has made several applications for interconnectivity.

Wright hit back, saying the Commission was disappointed that an application by a Swiss clearing house to hook up to LCH.Clearnet had not worked out.

“One hopes the good news is in the post,” Wright told Tupker.

In an interview with Reuters, EU Internal Market Commissioner Charlie McCreevy, who devised the code, said it should be given time to prove itself.

Commission officials needed hard evidence to pursue a competition complaint, something market participants had failed to provide despite loud calls for action. (Editing by Dale Hudson)