On 20 October 2019, the European Securities and Markets Authority (ESMA) published a memorandum of understanding (MoU) between itself and the Australian Securities and Investments Commission (ASIC) setting out cooperation arrangements in respect of Australian benchmarks. The MoU was signed on 9 October 2019.
On 29 July 2019, under Article 30 of the Benchmarks Regulation (BMR), the European Commission (Commission) recognised Australia’s legal and supervisory framework applicable to the administrators of certain financial benchmarks as equivalent to the corresponding requirements under the BMR. Additionally, the Commission recognised that those requirements are subject to effective supervision and enforcement. Consequently, the decision will allow benchmarks declared significant by ASIC i.e. BBSW, S&P/ASX200, Bond Futures Settlement Price, CPI, and Cash Rate to be used in the EU by EU-supervised entities.
The MoU sets out appropriate cooperation arrangements to complement the EU’s equivalence decision, as well as to ensure effective information exchange and supervisory coordination. Under the MoU, both authorities agree to provide each other with the fullest cooperation permissible under their laws and regulations in relation to all relevant information and supervisory activities regarding the covered benchmarks.