UK Bond Tape Clears Major Hurdle as FCA Wins Approval to Lift Contract Freeze

The UK's effort to build a national consolidated tape for bond markets took a significant step forward after the Financial Conduct Authority (FCA) secured court approval to lift the automatic suspension that had prevented it from signing a contract with Etrading Software (ETS). Once the High Court issues its final order, the regulator will be able to formalize the agreement while continuing to defend the still-active legal challenge.

The FCA said it will now "move forward on delivering the tape," initiating technical coordination with trading venues, dealers and end-users as it aims for a June 2026 launch. Removing the suspension eliminates the most immediate roadblock to the project and keeps the current timeline intact.

The procurement process had been stalled after an unnamed party filed a legal challenge earlier this year, triggering an automatic halt under UK public-procurement rules. Such challenges are common around major market-data infrastructure contracts, where losing bidders frequently dispute evaluation methods or technical scoring. The identity of the challenger has not been disclosed.

The judge's decision indicates the court did not see sufficient grounds to keep the freeze in place while the broader case progresses. The underlying dispute will continue, but the FCA is now free to build the system in parallel.

The bond tape is a long-discussed idea dating back to the MiFID II era, when EU regulators struggled to create consolidated tapes for both equities and fixed income. Years of disagreements over data rights, costs and mandatory submission rules left those efforts unresolved. Brexit allowed the UK to redesign its approach, and the Treasury's Wholesale Markets Review ultimately designated a bond tape as a priority for improving transparency and reducing data costs.

Fixed income is seen as the logical starting point because activity is fragmented across electronic platforms, interdealer brokers and bilateral OTC trading. A single record of pricing and activity is expected to benefit asset managers and smaller firms that often lack access to full market data.

Industry sources say ETS was selected partly because it is viewed as a neutral utility provider, with experience running regulatory infrastructure including global identifier systems. Choosing a non-exchange, non-data-vendor operator was intended to minimize concerns about conflicts of interest and encourage broad participation from market contributors.

With the suspension lifted, the FCA will begin work on standardizing feeds and finalizing ETS's authorization "as soon as possible," reflecting the tight schedule leading up to the 2026 target.

The UK's progress comes as ESMA advances its own consolidated-tape program within the EU. Both regions are competing to be the first to deliver a functional fixed-income tape—a milestone that could set global benchmarks for transparency.

After years of procedural delays and resistance from entrenched data providers, the UK's bond-tape initiative now has a clear runway to proceed. The coming months will determine whether it can meet the ambitious timeline and reshape access to fixed-income market data.