You might think this is true, but it's not. The first thing is that you give priority to earlier bids/asks which changes the incentive structure, second off, you have a single point of arrival (a timestamper network border machine), third off, you specify in the law that the clock of that point of arrival must be within 1/2 second of correct relative to some UTC standard, but that so long as it is, the time of arrival at that location according to that clock is definitive. Third off you specify the granularity of the timestamp as 1ms so that an easily attainable granularity is all that is required. This is after all a relativistic problem, there is no such thing as universal simultaneity of an action spread out around the globe (diameter of the earth is around 8000 miles so two points can easily vary in their perception of what's simultaneous by 43 ms or so)
Finally, the existence and openness of the call market changes the incentive. People can obtain liquidity by offering or asking, then canceling orders. It's not just "place orders, at the end clear them" but place orders, during the 5 second interval publish the bid/ask/quantity/spread and allow people to cancel and re-order so that the market price settles into an agreed stable level. Currently the HFT people are "eating" that bid/ask/spread/liquidity uncertainty, letting people signal their liquidity would give you all the liquidity advantage without any of the real resources (electricity, computer networks, people's time) being used up by HFT.
HFT is a loss to the world because there exists alternatives where essentially all the liquidity benefit is gotten and essentially none of the limited resources currently being used are in fact used.