On 1 February 2021, the European Securities and Markets Authority (ESMA) published a final report containing technical advice on supervisory fees to be paid to it by critical benchmark administrators and third country administrators under the recognition regime.

The legislative background to the technical advice is as follows:

  • Article 48I of the Benchmarks Regulation (BMR) requires ESMA to charge fees to the administrators of benchmarks it supervises. The fees should fully cover ESMA’s necessary expenditure relating to the supervision of the administrators of benchmarks. In particular, the total yearly amount of the fees charged to the administrators in a specific year should cover all costs incurred by ESMA for its activities in relation to the supervision of the administrators in the same year. The amount of the individual fees should be proportionate to the turnover of each administrator.
  • Article 48m of the BMR allows ESMA, where necessary for the proper performance of a supervisory task, to delegate specific supervisory tasks to a national competent authority. Such specific supervisory tasks may include the power to carry out requests for information or to conduct investigations and in-site inspections. The authorisation of critical benchmarks cannot be delegated by ESMA. When delegating a supervisory task, ESMA should reimburse the competent authority for the costs incurred as a result of carrying out such a task.
  • Paragraph 3 of Article 48I of the BMR requires the European Commission, by 1 October 2021, to adopt delegated acts in order to supplement the BMR by specifying, in relation to ESMA new supervisory powers, the type of fees, the matters for which fees are due, the amount of the fees and the manner in which they are to be paid.

The technical advice distinguishes between:

  • One-off recognition fee to be paid by third country administrators applying for recognition.
  • One-off authorisation fee to be paid by administrators of critical benchmarks applying for authorisation.
  • Annual supervisory fee to be paid by third country administrators.
  • Annual supervisory fee to be paid by critical benchmark administrators.

ESMA will publish the final report and will submit its advice to the European Commission.