Featured Product

    ESMA Sets Out Impact of Brexit on Benchmarks Regulation

    October 01, 2020

    ESMA published a statement that sets out the impact of Brexit on the ESMA Register for benchmark administrators and third-country benchmarks under the Benchmarks Regulation. The statement highlights that, post Brexit transition, the existing UK administrators will be deleted from the ESMA Register, as, by then, the Benchmarks Regulation will no longer be applicable to the benchmark administrators in UK. ESMA also published a final report setting out the updated regulatory technical standards that contain provisions ensuring that the governance arrangements of benchmark administrators are sufficiently robust and the potential manipulation of benchmarks is minimized, through additional rules on the methodology of calculation and controls to ensure the integrity of the data. These draft standards result from the ESAs Review and are expected to be submitted, by October 01, 2020, to EC, which will have three months in which to approve or reject them.

    After the transition period for the withdrawal of UK from EU ends on December 31, 2020, UK administrators (that are included in the ESMA Register) will be deleted from the ESMA Register as the Benchmarks Regulation will by then no longer be applicable to the benchmark administrators in UK. During the Benchmarks Regulation transitional period until December 31, 2021, as defined in Article 51(4) of the Benchmarks Regulation, this change of the ESMA Register would not have an effect on the ability of EU27 supervised entities to use the benchmarks provided by those third-country UK administrators. During the Benchmarks Regulation transitional period, third-country benchmarks can still be used by supervised entities in EU if the benchmark is already used in EU as a reference for financial instruments, financial contracts, or for measuring the performance of an investment fund. Therefore, until December 31, 2021, EU supervised entities can use third-country UK benchmarks even if they are not included in the ESMA Register. This Benchmarks Regulation transitional provision would be applicable to the benchmarks provided by the UK administrators deleted from the ESMA Register because of Brexit.

    In the absence of an equivalence decision by EC, UK administrators will have until the end of the Benchmarks Regulation transitional period of December 31, 2021 to apply for recognition or endorsement in EU, for the benchmarks provided by these UK administrators to be included in the ESMA Register again. Similarly, if some UK third-country benchmarks were included in the ESMA Register before the end of the Brexit transition period following a recognition or an endorsement status granted by the UK, those third-country benchmarks will be deleted from the ESMA Register after the end of the Brexit transition period. The Benchmarks Regulation transitional period until December 31, 2021 is also applicable to these third-country benchmarks endorsed or recognized in the UK. Therefore, during the Benchmarks Regulation transitional period, this deletion from the ESMA Register would not have an effect on the ability of EU27 supervised entities to use those third-country benchmarks that were endorsed or recognized in the UK before the end of the Brexit transition period. In the absence of an equivalence decision by EC, these third-country benchmarks previously endorsed or recognized in the UK will have until the end of the Benchmarks Regulation transitional period of December 31, 2021 to apply again for recognition or endorsement in EU, to be included in the ESMA Register.

     

    Related Links

    Keywords: Europe, EU, UK, Banking, Securities, Transition Period, Third Country Benchmarks, Regulatory Technical Standards, Benchmarks Regulation, ESMA

    Related Articles
    News

    NGFS Seeks Public Feedback on Climate Risk Assessment Scenarios

    The Network for Greening the Financial System (NGFS) launched its first user feedback survey on climate scenarios, with the feedback period ending on February 27, 2023.

    February 06, 2023 WebPage Regulatory News
    News

    EBA Launches Stress Tests for Banks, Issues Other Updates

    The European Banking Authority (EBA) launched the 2023 European Union (EU)-wide stress test, published annual reports on minimum requirement for own funds and eligible liabilities (MREL) and high earners with data as of December 2021.

    January 31, 2023 WebPage Regulatory News
    News

    EBA Proposes Standards for IRRBB Reporting Under Basel Framework

    The European Banking Authority (EBA) proposed implementing technical standards on the interest rate risk in the banking book (IRRBB) reporting requirements, with the comment period ending on May 02, 2023.

    January 31, 2023 WebPage Regulatory News
    News

    FED Issues Further Details on Pilot Climate Scenario Analysis Exercise

    The U.S. Federal Reserve Board (FED) set out details of the pilot climate scenario analysis exercise to be conducted among the six largest U.S. bank holding companies.

    January 17, 2023 WebPage Regulatory News
    News

    US Agencies Issue Several Regulatory and Reporting Updates

    The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.

    January 04, 2023 WebPage Regulatory News
    News

    ECB Issues Multiple Reports and Regulatory Updates for Banks

    The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.

    January 01, 2023 WebPage Regulatory News
    News

    HKMA Keeps List of D-SIBs Unchanged, Makes Other Announcements

    The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.

    December 30, 2022 WebPage Regulatory News
    News

    EU Issues FAQs on Taxonomy Regulation, Rules Under CRD, FICOD and SFDR

    The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.

    December 29, 2022 WebPage Regulatory News
    News

    CBIRC Revises Measures on Corporate Governance Supervision

    The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.

    December 29, 2022 WebPage Regulatory News
    News

    HKMA Publications Address Sustainability Issues in Financial Sector

    The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.

    December 23, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8702