On 5 March 2021, the FCA issued a Feedback Statement regarding the exercise of its powers under Article 23D of the onshored Benchmarks Regulation (BMR).
Article 23D of the BMR grants the FCA the ability, in certain circumstances, to impose certain requirements on the administrator of a critical benchmark designated under Article 23A. Article 23F(1)(d) of the BMR requires the FCA to prepare and publish a Statement of Policy on how it will exercise its powers under Article 23D.
In November 2020, the FCA published a consultation setting out its proposed policy approach in respect of applying the Article 23D requirements to a benchmark that has been designated as an Article 23A benchmark. The Feedback Statement now published summarizes the feedback the FCA received to the consultation and its response. The FCA has also published its Statement of Policy for Article 23D, fulfilling the requirement at Article 23F(1)(d).
The FCA is confirming in the Statement of Policy that it will include consideration of the factors that it outlined in its earlier consultation. In addition, after reviewing the responses, it has expanded some of the considerations that underpin the factors that were proposed.
The FCA will conduct a further consultation in Q2 2021 about its prospective decisions on whether and how to use the Article 23D powers in respect of certain LIBOR currency-tenor settings. The FCA will be seeking to give all users of LIBOR, including those outside the UK, an opportunity to engage.