DSB Increases Fees as User Numbers Grow

According to DSB, the biggest revenue impact was an increase from 66 to 78 power users, while the pool of users accessing the utility’s free data services jumped 93 percent.

“Whilst we are delighted with the large uptake of the DSB’s free, open data services, we are mindful that the smaller-than-expected number of users contributing to the DSB’s cost recovery results in an increase in individual user fees,” says Emma Kalliomaki, DSB managing director, in a statement. She adds that DSB believes user numbers will grow further as it continues to receive new inquiries from firms just realizing they will be creating over-the-counter ISINs. The company also expects to add users as a result of the increase in systematic internalizers later in 2018.

User fees pay for DSB’s overheads, which amount to €9.2 million ($11.3 million), 4.8 percent higher than the €8.8 million previously stated. According to DSB, the fee calculation was based on the contracts in force as of January 5 and the user categories those contracts represent. Currently, investment banks bear the highest burden of cost recovery, at 54 percent, followed by trading venues, which cover 33 percent. Other sectors, including asset management and data management, cover 13 percent. Excess revenues caused by additional contracts signed after January 5 will go to defraying user fees for the next contract year. Fees for infrequent users remain at €3,000 annually, mid-level users see an increase from €22,000 to €37,500, and the annual fee for power users has almost doubled from €65,000 to €112,500.

“The proportionately higher participation of banks relative to trading venues in the cost recovery validates the design of the OTC-ISIN as internally useful for business operations beyond satisfying reference data reporting obligations under Mifid II,” says Kalliomaki.

Later this year, DSB will reopen the fee model consultation with the industry, with a goal of redefining the cost-recovery model for 2019 by evaluating data and usage patterns in 2018.