On 21 September 2023, the European Commission (Commission) hosted a meeting of the Expert Group of the European Securities Committee (EGESC) where it discussed the upcoming review of the European Benchmarks Regulation (BMR). By way of background, the Commission issued earlier this year a Call for Evidence, consulting stakeholders whether the scope of the EU rules for financial benchmarks as well as the rules for the use of third-country benchmarks are still fit for purpose.
In accordance with the published minutes of the meeting, the Commission informed Member States’ experts that it intends to publish a proposal for a BMR review as a part of its “burden reduction” package, expected on 17 October 2023. The Commission also informed Member States that the scope of the upcoming BMR review evolved from focusing mainly on amendments to the third-country regime, to now also including amendments to the rules governing the provision of EU benchmarks and as such, “aiming to reduce administrative and registration burdens also for benchmark administrators domiciled in the Union”. To this end, the Commission intends to put forward a single threshold of EUR 50 billion that will define the scope of the BMR both in relation to EU and third-country benchmark administrators. In addition, the Commission issued a questionnaire to Member States, seeking feedback on a possible national designation regime that would complement the threshold-based regime.
In respect of third-country benchmarks, the Commission confirmed that it would involve designation of the third country administrator that offered at least one index with reference values in the EU that exceed EUR 50 billion. Once designated, the administrator would notify any additional indices in its portfolio that exceed the EUR 50 billion threshold.
Regarding commodity benchmarks, the Commission stated that a threshold-based approach to the scope of the BMR would exclude all known commodity indices and price assessments provided by price reporting agencies, and such benchmarks would be the subject matter of national designations. That said, the Commission confirmed that the two climate change benchmarks currently in scope of the BMR would remain within its perimeter irrespective of the value of their reference assets.