On 7 November 2023, HM Treasury (HMT) published a policy paper on extending the transitional period for third country benchmarks under the UK Benchmarks Regulation.
The policy paper confirmed that the Government would be laying a statutory instrument extending the transitional period for third country benchmarks to 31 December 2030 by amending Article 51(5) of the UK Benchmarks Regulation.
The UK Benchmarks Regulation includes a third country regime which stipulates that only third country benchmark administrators approved for use via equivalence, recognition or endorsement may continue to be used within the UK after the end of a transitional period. Without this statutory instrument, the transitional period would expire at the end of 2025, at which time third country administrators must have taken one of the above access routes for their benchmarks to continue to be used in the UK.
The Government has set out previously its concerns that, should the third country benchmarks regime come into force, it could reduce the number and variety of important benchmarks available in the UK. Extending the transitional period to December 2030 is intended to allow time for the Government to consider where reforms are needed to the third country benchmarks regime, and make these changes as part of the implementation of the wider Smarter Regulatory Framework programme.
HMT intends for the statutory instrument to come into force on 1 January 2024.