EBS Direct Announces Rulebook Changes to Help Drive Industry Adoption of FX Global Code

From April 1 EBS will disable liquidity providers from all EBS Direct liquidity pools by default unless they have signed up to the Code

Also effective April 1, EBS Direct will update its dealing policy to reduce its "last look" thresholds from 200 to 30 milliseconds

EBS Direct is also enhancing its transaction cost analysis (TCA) tools

March 06, 2023 - CME-owned FX platform provider EBS today announced an update to its liquidity provider eligibility criteria for EBS Direct, its relationship-based quote-driven market, it says “to help accelerate the industry shift towards full compliance with the FX Global Code”{.

Building on its long-term commitment to the Code, from April 1 EBS will disable liquidity providers from all EBS Direct liquidity pools by default unless they have signed up to the Code. As a relationship-based platform, clients will be able to maintain relationships with non-compliant liquidity providers if they choose to, but they must proactively opt to do so. Also effective April 1, EBS Direct will update its dealing policy to reduce its "last look" thresholds from 200 to 30 milliseconds.

"As a market-leading platform for FX spot and forwards liquidity, the changes we're announcing today for EBS Direct will accelerate the industry shift towards FX Global Code compliance," said Jeff Ward, Global Head of EBS. "Our new trading rules will create minimum standards for our market while our new transparency tools will help the ecosystem evolve." 

"Any measures that help to increase transparency in the foreign exchange market and support FX Global Code adherence by market participants are welcomed by the Global Foreign Exchange Committee," said its Chair Andréa M. Maechler.

"Credit Suisse (CS) supports adherence to the FX Global Code and we appreciate the work done by EBS Direct to encourage compliance," said John Estrada, Global Head of FX Trading at Credit Suisse.  "FX must continue to move forward and this work is a step in the right direction."

"We congratulate the efforts and progress made by both EBS and its LPs in tightening the thresholds for last look times," added Zar Amrolia, Chairman & Co-CEO at XTX Markets. "Today's changes from EBS are an important step forward in the industry's journey to zero additional hold times in line with the FX Global Code."

The updates follow a detailed review of trading on EBS Direct, revealing that average last look hold times in 2022 were just 12 milliseconds and 96% of volumes were with liquidity providers that have stated their adherence to the FX Global Code.

To help clients across the ecosystem, EBS Direct is also enhancing its industry-leading and highly transparent transaction cost analysis (TCA) tools, including metrics to monitor flow quality, such as whether a counterparty is co-located with the exchange, and median, 90% and 99% last look hold times.

EBS also provides firm, transparent and anonymous liquidity via its EBS Market central limit order book for spot and NDFs. For more information on EBS see here: https://www.cmegroup.com/markets/ebs.html