EU Benchmark Regulations CELEX - 32016R1011 - EN - TXT

29.6.
2016 EN Official Journal of the European Union L 171/1
(Legislative acts)
REGULATIONS
REGULATION (EU) 2016/1011 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

of 8 June 2016
on indices used as benchmarks in financial instruments and financial contracts or to measure the
performance of investment funds and amending Directives 2008/48/EC and 2014/17/EU and
Regulation (EU) No 596/2014
(Text with EEA relevance)
THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the Functioning of the European Union, and in particular Article 114 thereof,
Having regard to the proposal from the European Commission,
After transmission of the draft legislative act to the national parliaments,
Having regard to the opinion of the European Central Bank (1),
Having regard to the opinion of the European Economic and Social Committee (2),
Acting in accordance with the ordinary legislative procedure (3),
Whereas:
(1) The pricing of many financial instruments and financial contracts depends on the accuracy and integrity of
benchmarks. Serious cases of manipulation of interest rate benchmarks such as LIBOR and EURIBOR, as well as
allegations that energy, oil and foreign exchange benchmarks have been manipulated, demonstrate that
benchmarks can be subject to conflicts of interest. The use of discretion, and weak governance regimes, increase
the vulnerability of benchmarks to manipulation. Failures in, or doubts about, the accuracy and integrity of
indices used as benchmarks can undermine market confidence, cause losses to consumers and investors and
distort the real economy. It is therefore necessary to ensure the accuracy, robustness and integrity of benchmarks
and of the benchmark determination process.
(2) Directive 2014/65/EU of the European Parliament and of the Council (4) contains certain requirements with
respect to the reliability of benchmarks used to price a listed financial instrument. Directive 2003/71/EC of the
European Parliament and of the Council (5) contains certain requirements on benchmarks used by issuers.
(1) OJ C 113, 15.4.2014, p. 1.

(2) OJ C 177, 11.6.2014, p. 42.
(3) Position of the European Parliament of 28 April 2016 (not yet published in the Official Journal) and decision of the Council of 17 May
2016.
(4) Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and
amending Directive 2002/92/EC and Directive 2011/61/EU (OJ L 173, 12.6.2014, p. 349).
(5) Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003 on the prospectus to be published when
securities are offered to the public or admitted to trading and amending Directive 2001/34/EC (OJ L 345, 31.12.2003, p. 64).
L 171/2 EN Official Journal of the European Union 29.6.2016
Directive 2009/65/EC of the European Parliament and of the Council (1) contains certain requirements on the use
of benchmarks by undertakings for collective investment in transferable securities (UCITS). Regulation (EU)
No 1227/2011 of the European Parliament and of the Council (2) contains certain provisions which prohibit the
manipulation of benchmarks that are used for wholesale energy products. However, those legislative acts only
cover certain aspects of certain benchmarks and they neither address all the vulnerabilities in the provision of all
benchmarks, nor do they cover all uses of financial benchmarks in the financial industry.
(3) Benchmarks are vital in pricing cross-border transactions, thereby facilitating the effective functioning of the
internal market in a wide variety of financial instruments and services. Many benchmarks used as reference rates
in financial contracts, in particular mortgages, are provided in one Member State but used by credit institutions
and consumers in other Member States. In addition, such credit institutions often hedge their risks or obtain
funding for granting those financial contracts in the cross-border interbank market. Only a few Member States
have adopted national rules on benchmarks, but their respective legal frameworks on benchmarks already show
divergences regarding aspects such as the scope of application. In addition, the International Organisation of
Securities Commissions (IOSCO) agreed principles on financial benchmarks on 17 July 2013 (‘IOSCO principles
for financial benchmarks’), Principles for Oil Price Reporting Agencies on 5 October 2012 (‘IOSCO principles for
PRAs’) (together, ‘the IOSCO principles’), and since those principles provide a certain flexibility as to their exact
scope and means of implementation, Member States are likely to adopt rules at national level which would
implement such principles in a divergent manner.
(4) Those divergent approaches would result in fragmentation of the internal market since administrators and users
of benchmarks would be subject to different rules in different Member States. Thus, benchmarks provided in one
Member State could be prevented from being used in other Member States. In the absence of a harmonised
framework to ensure the accuracy and integrity of benchmarks used in financial instruments and financial
contracts, or in order to measure the performance of investment funds, in the Union it is therefore likely that
differences in Member States' laws will create obstacles to the smooth functioning of the internal market for the
provision of benchmarks.
(5) Union consumer protection rules do not cover the particular issue of adequate information on benchmarks in
financial contracts. As a result of consumer complaints and litigation relating to the use of benchmarks in several
Member States, it is likely that divergent measures, inspired by legitimate concerns of consumer protection,
would be adopted at national level, which could result in fragmentation of the internal market due to the
divergent conditions of competition attached to different levels of consumer protection.
(6) Therefore, in order to ensure the proper functioning of the internal market and improve the conditions of its
functioning, in particular with regard to financial markets, and to ensure a high level of consumer and investor
protection, it is appropriate to lay down a regulatory framework for benchmarks at Union level.
(7) It is appropriate and necessary for that framework to take the form of a regulation in order to ensure that
provisions directly imposing obligations on persons involved in the provision, contribution and use of
benchmarks are applied in a uniform manner throughout the Union. Since a legal framework for the provision of
benchmarks necessarily involves measures specifying precise requirements concerning aspects inherent to such
provision of benchmarks, even small divergences on the approach taken regarding one of those aspects could
lead to significant impediments in the cross-border provision of benchmarks. Therefore, the use of a regulation,
which is directly applicable, should reduce the possibility of divergent measures being taken at national level, and
should ensure a consistent approach and greater legal certainty, and prevent the appearance of significant
impediments in the cross-border provision of benchmarks.
(8) The scope of this Regulation should be as broad as necessary to create a preventive regulatory framework. The
provision of benchmarks involves discretion in their determination and is inherently subject to certain types of
(1) Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 on the coordination of laws, regulations and
administrative provisions relating to undertakings for collective investment in transferable securities (UCITS) (OJ L 302, 17.11.2009,
p. 32).
(2) Regulation (EU) No 1227/2011 of the European Parliament and of the Council of 25 October 2011 on wholesale energy market
integrity and transparency (OJ L 326, 8.12.2011, p. 1).
29.6.2016 EN Official Journal of the European Union L 171/3
conflicts of interest, which implies the existence of opportunities and incentives to manipulate benchmarks. Such
risk factors are common to all benchmarks and should be made subject to adequate governance and control
requirements. The degree of risk, however, varies, and the approach adopted should therefore be tailored to the
particular circumstances. Since the vulnerability and importance of a benchmark varies over time, restricting the
scope by reference to indices that are currently important or vulnerable would not address the risks that any
benchmark poses in the future. In particular, benchmarks that are currently not widely used could be used more
in the future with the result that, in their regard, even a minor manipulation could have a significant impact.
(9) The critical determinant of the scope of this Regulation should be whether the output value of the benchmark
determines the value of a financial instrument or a financial contract, or measures the performance of an
investment fund. Therefore, the scope should not be dependent on the nature of the input data. Benchmarks
calculated from economic input data, such as share prices and non-economic numbers, or values such as weather
parameters should thus be included. The framework provided for in this Regulation should also acknowledge the
existence of a large number of benchmarks and the different impact that they have on financial stability and the
real economy. This Regulation should also provide for a proportionate response to the risks that different
benchmarks pose. This Regulation should therefore cover benchmarks which are used to price financial
instruments listed or traded on regulated venues.
(10) A large number of consumers are parties to financial contracts, in particular consumer credit agreements secured
by mortgages, that reference benchmarks that are subject to the same risks. This Regulation should therefore
cover credit agreements as defined in Directives 2008/48/EC (1) and 2014/17/EU of the European Parliament and
of the Council (2).
(11) Many investment indices involve significant conflicts of interest and are used to measure the performance of a
fund such as a UCITS fund. Some of those benchmarks are published and others are made available, for free or
upon payment of a fee, to the public or a section of the public and their manipulation can adversely affect
investors. This Regulation should therefore cover indices or reference rates that are used to measure the
performance of an investment fund.
(12) All contributors of input data to benchmarks can exercise discretion and are potentially subject to conflicts of
interest, and so risk being a source of manipulation. Contributing to a benchmark is a voluntary activity. If any
initiative requires contributors to significantly change their business models, they could cease to contribute.
However, for entities already subject to regulation and supervision, requiring good governance and control
systems is not expected to lead to substantial costs or disproportionate administrative burden. Therefore this
Regulation imposes certain obligations on supervised contributors. When a benchmark is determined on the
basis of readily available data, the source of such data should not be considered to be a contributor.
(13) Financial benchmarks are not only used in the issuance and manufacturing of financial instruments and
contracts. The financial industry also relies on benchmarks for measuring the performance of investment funds
for the purpose of return tracking or of determining the asset allocation of a portfolio or of computing the
performance fees. A given benchmark can be used either directly as a reference for financial instruments and
financial contracts or to measure the performance of investment funds, or indirectly within a combination of
benchmarks. In the latter case, the setting and review of the weights to be assigned to various indices within a
combination for the purpose of determining the pay-out or the value of a financial instrument or a financial
contract or measuring the performance of an investment fund also amounts to use as such an activity does not
involve discretion, in contrast to the activity of provision of benchmarks. The holding of financial instruments
referencing a certain benchmark is not considered to be use of the benchmark.
(14) Central banks already meet principles, standards and procedures which ensure that they exercise their activities
with integrity and in an independent manner. It is therefore not necessary that central banks be subject to this
Regulation. When central banks provide benchmarks, especially where those benchmarks are intended for
transaction purposes, it is their responsibility to set appropriate internal procedures in order to ensure the
(1) Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit agreements for consumers and
repealing Council Directive 87/102/EEC (OJ L 133, 22.5.2008, p. 66).
(2) Directive 2014/17/EU of the European Parliament and of the Council of 4 February 2014 on credit agreements for consumers relating to
residential immovable property and amending Directives 2008/48/EC and 2013/36/EU and Regulation (EU) No 1093/2010 (OJ L 60,
28.2.2014, p. 34).
accuracy, integrity, reliability and independence of those benchmarks, in particular with respect to transparency
in governance and computation methodology.
(15) Furthermore, public authorities, including national statistics agencies, should not be subject to this Regulation
where they contribute data to, provide or have control over the provision of, benchmarks for public policy
purposes, including measures of employment, economic activity, and inflation.
(16) An administrator is the natural or legal person that has control over the provision of a benchmark and in
particular administers the arrangements for determining the benchmark, collects and analyses the input data,
determines the benchmark and publishes it. An administrator should be able to outsource to a third party one or
more of those functions, including the calculation or publication of the benchmark, or other relevant services
and activities in the provision of the benchmark. However, where a person merely publishes or refers to a
benchmark as part of that person's journalistic activities but does not have control over the provision of that
benchmark, that person should not be subject to the requirements imposed on administrators by this Regulation.
(17) An index is calculated using a formula or some other methodology on the basis of underlying values. There
exists a degree of discretion in constructing the formula, performing the necessary calculation and determining
the input data which creates a risk of manipulation. Therefore, all benchmarks sharing that characteristic of
discretion should be covered by this Regulation.
(18) However, where a single price or value is used as a reference to a financial instrument, for example where the
price of a single security is the reference price for an option or future, there is no calculation, input data or
discretion. Therefore single price or single value reference prices should not be considered to be benchmarks for
the purposes of this Regulation.
(19) Reference prices or settlement prices produced by central counterparties (CCPs) should not be considered to be
benchmarks because they are used to determine settlement, margins and risk management and thus do not
determine the amount payable under a financial instrument or the value of a financial instrument.
(20) The provision of borrowing rates by creditors should not be considered to be benchmark provision for the
purposes of this Regulation. A borrowing rate provided by a creditor is either set by an internal decision or
calculated as a spread or mark-up over an index (e.g. EURIBOR). In the first case, the creditor is exempt from this
Regulation for activity concerning financial contracts entered into by that creditor with its own clients, while in
the latter case the creditor is considered to be only a user of a benchmark.
(21) In order to ensure the integrity of benchmarks, benchmark administrators should be required to implement
adequate governance arrangements to control conflicts of interest and to safeguard confidence in the integrity of
benchmarks. Even where effectively managed, most administrators are subject to some conflicts of interest and
could have to make judgements and decisions which affect a diverse group of stakeholders. It is therefore
important that administrators have in place a function that operates with integrity to oversee the implementation
and effectiveness of the governance arrangements that provide effective oversight.
(22) The manipulation or unreliability of benchmarks can cause damage to investors and consumers. Therefore, this
Regulation should set out a framework for retention of records by administrators and contributors as well as for
providing transparency about a benchmark's purpose and methodology which facilitates a more efficient and
fairer resolution of potential claims in accordance with national or Union law.
(23) Auditing and the effective enforcement of this Regulation requires ex post analysis and evidence. This Regulation
should therefore set out requirements for adequate record-keeping by benchmark administrators relating to the
calculation of the benchmark for a sufficient period of time. The reality that a benchmark intends to measure and
the environment in which it is measured are likely to change over time. Therefore it is necessary that the process
and methodology of the provision of benchmarks are reviewed on a periodic basis to identify shortcomings and
possible improvements. Many stakeholders can be impacted by failures in the provision of the benchmark and
can help identify such shortcomings. This Regulation should therefore set out a framework for the establishment
of a complaints handling mechanism by benchmark administrators to enable stakeholders to notify the
benchmark administrator of complaints and ensure that the benchmark administrator objectively evaluates the
merits of any complaint.
(24) The provision of benchmarks frequently involves the outsourcing of important functions such as calculating the
benchmark, gathering input data and disseminating the benchmark. In order to ensure the effectiveness of the
governance arrangements, it is necessary to ensure that any such outsourcing does not relieve benchmark
administrators of any of their obligations and responsibilities, and is done in such a way that it does not interfere
with either the administrators' ability to meet their obligations or responsibilities, or the relevant competent
authority's ability to supervise them.
(25) The benchmark administrator is the central recipient of input data and is able to evaluate the integrity and
accuracy of input data on a consistent basis. It is therefore necessary that this Regulation requires administrators
to take certain measures where an administrator considers that input data does not represent the market or
economic reality that a benchmark intends to measure, comprising measures to change the input data, the
contributors or the methodology or else to cease providing that benchmark. Furthermore, an administrator
should, as part of its control framework, establish measures to monitor, where feasible, input data prior to the
publication of the benchmark and to validate input data after publication, including comparing that data against
historical patterns where applicable.
(26) Any discretion that can be exercised in providing input data creates an opportunity to manipulate a benchmark.
Where the input data is transaction-based data, there is less discretion and therefore the opportunity to
manipulate the data is reduced. As a general rule, benchmark administrators should therefore use actual
transaction-based input data where possible but other data can be used in those cases where the transaction data
is insufficient or inappropriate to ensure the integrity and accuracy of the benchmark.
(27) The accuracy and reliability of a benchmark in measuring the economic reality it is intended to measure depends
on the methodology and input data used. It is therefore necessary to adopt a transparent methodology that
ensures the benchmark's reliability and accuracy. Such transparency does not mean the publication of the
formula applied for the determination of a given benchmark, but rather the disclosure of elements sufficient to
allow stakeholders to understand how the benchmark is derived and to assess its representativeness, relevance
and appropriateness for its intended use.
(28) It could become necessary to change the methodology to ensure the continued accuracy of the benchmark, but
any changes in the methodology have an impact on users and stakeholders of the benchmark. It is therefore
necessary to specify the procedures to be followed when changing the benchmark methodology, including the
need for consultation, so that users and stakeholders can take the necessary action in light of those changes or
notify the administrator if they have concerns about those changes.
(29) Employees of the administrator can identify possible infringements of this Regulation or potential vulnerabilities
that could lead to manipulation or attempted manipulation. This Regulation should therefore put in place a
framework to enable employees to alert administrators confidentially of possible infringements of this Regulation.
(30) The integrity and accuracy of benchmarks depends on the integrity and accuracy of the input data provided by
contributors. It is essential that the obligations of contributors in respect of such input data are clearly specified,
that compliance with those obligations can be relied upon, and that the obligations are consistent with the
benchmark administrator's controls and methodology. It is therefore necessary that the benchmark administrator
produces a code of conduct to specify those requirements and the contributor's responsibilities concerning the
provision of input data. The administrator should be satisfied that contributors adhere to the code of conduct.
Where contributors are located in third countries, the administrator should be satisfied to the extent possible.
(31) Contributors are potentially subject to conflicts of interest and are able to exercise discretion in the determination
of input data. Therefore, it is necessary for contributors to be subject to governance arrangements in order to
ensure that those conflicts are managed and that the input data is accurate, conforms to the administrator's
requirements and can be validated.
(32) Many benchmarks are determined by the application of a formula using input data that is provided by the
following entities: a trading venue, an approved publication arrangement, a consolidated tape provider, an
approved reporting mechanism, an energy exchange or an emission allowance auction platform. In some
situations, data collection is outsourced to a service provider that receives the data entirely and directly from
those entities. In those cases, existing regulation and supervision ensure the integrity and transparency of the
input data and provide for governance requirements and procedures for the notification of infringements.
Therefore, those benchmarks are less vulnerable to manipulation, are subject to independent verifications, and the
relevant administrators are accordingly released from certain obligations set out in this Regulation.
(33) Different types of benchmarks and different benchmark sectors have different characteristics, vulnerabilities and
risks. The provisions of this Regulation should be further specified for particular benchmark sectors and types.
Interest rate benchmarks are benchmarks that play an important role in the transmission of monetary policy and
so it is necessary to introduce specific provisions in this Regulation for such benchmarks.
(34) Physical commodities markets have unique characteristics which should be taken into account. Commodity
benchmarks are widely used and can have sector-specific characteristics, so it is necessary to introduce specific
provisions in this Regulation for such benchmarks. Certain commodity benchmarks are exempt from this
Regulation but would need to nevertheless respect the relevant IOSCO principles. Commodity benchmarks can
become critical since the regime is not limited to benchmarks based on submissions by contributors which are in
majority supervised entities. For critical commodity benchmarks subject to Annex II, the requirements of this
Regulation regarding mandatory contribution and colleges are not applicable.
(35) The failure of critical benchmarks can impact market integrity, financial stability, consumers, the real economy, or
the financing of households and businesses in Member States. Those potentially destabilising effects of the failure
of a critical benchmark could be felt in a single Member State or in more than one. It is therefore necessary that
this Regulation provides for a process to determine those benchmarks that should be considered to be critical
benchmarks and that additional requirements apply to ensure the integrity and robustness of such benchmarks.
(36) Critical benchmarks can be determined using a quantitative criterion or a combination of quantitative and
qualitative criteria. In addition, in cases where a benchmark does not meet the appropriate quantitative threshold,
it could nonetheless be recognised as critical where the benchmark has no or very few market-led substitutes and
its existence and accuracy are relevant for market integrity, financial stability or consumer protection in one or
more Member States, and where all the relevant competent authorities agree that such a benchmark should be
recognised as critical. In the event of disagreement between the relevant competent authorities, the decision of
the competent authority of the administrator on whether such a benchmark should be recognised as critical
should prevail. In such a case, the European Securities and Markets Authority (ESMA), established by Regulation
(EU) No 1095/2010 of the European Parliament and of the Council (1), should be able to publish an opinion on
the assessment made by the competent authority of the administrator. Furthermore, a competent authority can
also designate a benchmark as critical based on certain qualitative criteria where the administrator and the
majority of the contributors to the benchmark are located in its Member State. All critical benchmarks should be
included in a list established by a way of an implementing act by the Commission, which should be reviewed and
updated regularly.
(37) The cessation of the administration of a critical benchmark by an administrator could render financial contracts
or financial instruments invalid, cause losses to consumers and investors, and impact financial stability. It is
therefore necessary to include a power for the relevant competent authority to require mandatory administration
of a critical benchmark in order to preserve the existence of the benchmark in question. In the event of
insolvency proceedings of a benchmark administrator, the competent authority should provide an assessment for
(1) Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European
Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and repealing Commission
Decision 2009/77/EC (OJ L 331, 15.12.2010, p. 84).
the consideration of the relevant judicial authority of whether and how the critical benchmark could be
transitioned to a new administrator or could cease to be provided.
(38) Without prejudice to the application of Union competition law and the ability of Member States to take measures
to facilitate compliance with it, it is necessary to require administrators of critical benchmarks, including critical
commodity benchmarks, to take adequate steps to ensure that licences of, and information on, benchmarks are
provided on a fair, reasonable, transparent and non-discriminatory basis to all users.
(39) Contributors that cease to contribute input data to critical benchmarks can undermine the credibility of such
benchmarks, as the capability of such benchmarks to measure the underlying market or economic reality would
as a result be impaired. It is therefore necessary to include a power for the relevant competent authority to
require mandatory contributions from supervised entities to critical benchmarks in order to preserve the
credibility of the benchmark in question. Mandatory contribution of input data is not intended to impose an
obligation on supervised entities to enter into, or to commit to entering into, transactions.
(40) Due to the existence of a large variety of types and sizes of benchmarks, it is important to introduce propor
tionality in this Regulation and to avoid putting an excessive administrative burden on administrators of
benchmarks the cessation of which poses less threat to the wider financial system. Thus, in addition to the
regime for critical benchmarks, two distinct regimes should be introduced: one for significant benchmarks and
one for non-significant benchmarks.
(41) Administrators of significant benchmarks should be able to choose not to apply a limited number of detailed
requirements of this Regulation. Competent authorities should, however, maintain the right to require the
application of those requirements, based on criteria outlined in this Regulation. Delegated acts and implementing
acts that apply to significant benchmark administrators should take due account of the principle of propor
tionality and aim to avoid administrative burden where possible.
(42) Administrators of non-significant benchmarks are subject to a less detailed regime, whereby administrators
should be able to choose not to apply some requirements of this Regulation. In such a case, the administrator in
question should explain why it is appropriate not to do so in a compliance statement which should be published
and provided to the administrator's competent authority. That competent authority should review the compliance
statement and should be able to request additional information or require changes to ensure compliance with this
Regulation. While non-significant benchmarks could still be vulnerable to manipulation, they are more easily
substitutable, therefore transparency to users should be the main tool used for market participants to make
informed choices about the benchmarks they consider appropriate for use. For that reason, the delegated acts in
Title II should not apply to non-significant benchmark administrators.
(43) In order for users of benchmarks to choose appropriately from among, and understand the risks of, benchmarks,
they need to know what a given benchmark intends to measure and its susceptibility to manipulation. Therefore,
the benchmark administrator should publish a benchmark statement specifying those elements. In order to
ensure uniform application and that benchmark statements are of reasonable length but at the same time focus
on providing the key information needed to users in an easily accessible manner, ESMA should provide further
specification of the content of the benchmark statement, differentiating appropriately among the different types
and specificities of benchmarks and their administrators.
(44) This Regulation should take into account the IOSCO principles, which serve as global standards for regulatory
requirements for benchmarks. As an overarching principle, in order to ensure investor protection, supervision
and regulation in a third country should be equivalent to Union supervision and regulation of benchmarks.
Therefore, benchmarks provided from that third country can be used by supervised entities in the Union where a
positive decision on equivalence of the third- country regime has been taken by the Commission. In such circum
stances, competent authorities should enter into cooperation arrangements with supervisory authorities in third
countries. ESMA should coordinate the development of such cooperation arrangements and the exchange
between competent authorities of information received from third countries. However, in order to avoid any
adverse impact resulting from a possible abrupt cessation of the use in the Union of benchmarks provided from a
third country, this Regulation also provides for certain other mechanisms (namely, recognition and endorsement)
under which third-country benchmarks can be used by supervised entities located in the Union.
(45) This Regulation introduces a process for the recognition of administrators located in a third country by the
competent authority of the Member State of reference. Recognition should be granted to administrators
complying with the requirements of this Regulation. Acknowledging the role of the IOSCO principles as a global
standard for the provision of benchmarks, the competent authority of the Member State of reference should be
able to grant recognition to administrators on the basis of them applying the IOSCO principles. To do so, the
competent authority should assess the application of the IOSCO principles by a specific administrator and
determine whether such application is equivalent, for the administrator in question, to compliance with the
various requirements established in this Regulation, taking into account the specificities of the regime of
recognition as compared to the equivalence regime.
(46) This Regulation also introduces an endorsement regime allowing, under certain conditions, administrators or
supervised entities located in the Union to endorse benchmarks provided from a third country in order for such
benchmarks to be used in the Union. To do so, the competent authority should take into account whether, in
providing the benchmark to be endorsed, compliance with the IOSCO principles would be equivalent to
compliance with this Regulation, taking into account the specificities of the regime of endorsement as compared
to the equivalence regime. An administrator or a supervised entity that has endorsed a benchmark provided from
a third country should be fully responsible for such endorsed benchmarks and for the fulfilment of the relevant
conditions referred to in this Regulation.
(47) All benchmark administrators are able to exercise discretion, are potentially subject to conflicts of interest, and
risk having inadequate governance and control systems in place. As administrators control the benchmark deter
mination process, requiring authorisation or registration and supervision of administrators is the most effective
way of ensuring the integrity of benchmarks.
(48) Certain administrators should be authorised and supervised by the competent authority of the Member State
where the administrator in question is located. Entities already subject to supervision and that provide financial
benchmarks other than critical benchmarks should be registered and supervised by the competent authority for
the purposes of this Regulation. Entities that provide only indices that qualify as non-significant benchmarks
should also be registered by the relevant competent authority. Authorisation and registration should be distinct
processes with authorisation requiring a more extensive assessment of the administrator's application. Whether
an administrator is authorised or registered should not affect the supervision of that administrator by the relevant
competent authorities. Additionally, a transitional regime should be introduced, according to which persons
providing benchmarks which are not critical and are not widely used in one or more Member States could be
registered, with a view to facilitating the initial phase of application of this Regulation. ESMA should maintain at
the Union level a register that contains information on authorised or registered administrators, on benchmarks
and the administrators that provide those benchmarks by virtue of a positive decision under either the
equivalence regime or the recognition regime, on Union administrators or supervised entities that have endorsed
benchmarks from a third country, and on any such endorsed benchmarks and their administrators located in a
third country.
(49) In some circumstances a person provides an index but could be unaware that the index in question is being used
as a reference for a financial instrument, a financial contract or an investment fund. That is particularly the case
where the users and benchmark administrator are located in different Member States. It is therefore necessary to
increase the level of transparency concerning which specific benchmark is being used. Such transparency can be
achieved by improving the content of the prospectuses or key information documents required by Union law and
the content of the notifications required by Regulation (EU) No 596/2014 of the European Parliament and of the
Council (1).
(50) A set of effective tools and powers and resources for the competent authorities of Member States guarantees
supervisory effectiveness. This Regulation should therefore, in particular, provide for a minimum set of
supervisory and investigative powers which should be entrusted to competent authorities of Member States in
accordance with national law. When exercising their powers under this Regulation, competent authorities and
ESMA should act objectively and impartially and remain autonomous in their decision-making.
(51) For the purpose of detecting infringements of this Regulation, it is necessary for competent authorities to be able
to access, in accordance with national law, the premises of legal persons in order to seize documents. Access to
such premises is necessary when there is reasonable suspicion that documents and other data related to the
(1) Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse
regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC,
2003/125/EC and 2004/72/EC (OJ L 173, 12.6.2014, p. 1).
subject-matter of an inspection or investigation exist and could be relevant to prove an infringement of this
Regulation. Additionally, access to such premises is necessary where the person to whom a demand for
information has already been made fails to comply with it, or where there are reasonable grounds for believing
that if a demand were to be made, it would not be complied with, or that the documents or information to
which the information requirement relates would be removed, tampered with or destroyed. If prior authorisation
is needed from the judicial authority of the Member State concerned, in accordance with national law, access to
premises should take place after having obtained that prior judicial authorisation.
(52) Existing recordings of telephone conversations and data traffic records from supervised entities can constitute
crucial, and sometimes the only, evidence to detect and prove the existence of infringements of this Regulation,
in particular the compliance with governance and control requirements. Such records and recordings can help to
verify the identity of the person responsible for the submission of input data, those responsible for its approval
and whether organisational separation of employees is maintained. Therefore, competent authorities should be
able to require existing recordings of telephone conversations, electronic communications and data traffic records
held by supervised entities, in those cases where a reasonable suspicion exists that such recordings or records
related to the subject-matter of the inspection or investigation could be relevant to prove an infringement of this
Regulation.
(53) This Regulation respects the fundamental rights and observes the principles recognised in the Treaty on the
Functioning of the European Union (TFEU) and in the Charter of Fundamental Rights of the European Union, in
particular the right to respect for private and family life, the protection of personal data, the right to freedom of
expression and information, the freedom to conduct a business, the right to property, the right to consumer
protection, the right to an effective remedy, the right of defence. Accordingly, this Regulation should be
interpreted and applied in accordance with those rights and principles.
(54) The rights of defence of the persons concerned should be fully respected. In particular, persons subject to
proceedings should be provided with access to the findings upon which the competent authorities has based the
decision and should be given the right to be heard.
(55) Transparency regarding benchmarks is necessary for reasons of financial market stability and investor protection.
Any exchange or transmission of information by competent authorities should take place in accordance with the
rules on the transfer of personal data laid down in Directive 95/46/EC of the European Parliament and of the
Council (1). Any exchange or transmission of information by ESMA should take place in accordance with the
rules on the transfer of personal data laid down in Regulation (EC) No 45/2001 of the European Parliament and
of the Council (2).
(56) Taking into consideration the principles set out in the Commission's Communication of 8 December 2010 on
reinforcing sanctioning regimes in the financial services sector, and legal acts of the Union adopted as a follow-up
to that Communication, Member States should, in order to ensure a common approach and deterrent effect, lay
down rules on administrative sanctions and other administrative measures, including pecuniary sanctions,
applicable to infringements of the provisions of this Regulation and should ensure that they are implemented.
Those administrative sanctions and other administrative measures should be effective, proportionate and
dissuasive.
(57) Administrative sanctions and other administrative measures applied in specific cases should be determined taking
into account, where appropriate, factors such as the repayment of any identified financial benefit, the gravity and
duration of the infringement, any aggravating or mitigating factors, the need for administrative pecuniary
sanctions to have a deterrent effect and, where appropriate, include a reduction in return for cooperation with
the competent authority. In particular, the actual amount of administrative pecuniary sanctions to be imposed in
a specific case should be able to reach the maximum level provided for in this Regulation, or the higher level
provided for in national law, for very serious infringements, while administrative pecuniary sanctions significantly
lower than the maximum level should be able to be applied to minor infringements or in case of settlement. The
possibility of imposing a temporary ban on the exercise of management functions within benchmark adminis
trators or contributors should be available to the competent authority.
(1) Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to
the processing of personal data and on the free movement of such data (OJ L 281, 23.11.1995, p. 31).
(2) Regulation (EC) No 45/2001 of the European Parliament and of the Council of 18 December 2000 on the protection of individuals with
regard to the processing of personal data by the Community institutions and bodies and on the free movement of such data (OJ L 8,
12.1.2001, p. 1).
(58) This Regulation should not limit the ability of Member States to provide for higher levels of administrative
sanctions and should be without prejudice to any provisions in the law of Member States relating to criminal
sanctions.
(59) Even though nothing prevents Member States from laying down rules for administrative and criminal sanctions
for the same infringement, Member States should not be required to lay down rules for administrative sanctions
for the infringements of this Regulation which are subject to national criminal law. In accordance with national
law, Member States are not obliged to impose both administrative and criminal sanctions for the same offence,
but they should be able to do so if their national law so permits. However, the maintenance of criminal sanctions
instead of administrative sanctions for infringements of this Regulation should not reduce or otherwise affect the
ability of competent authorities to cooperate, access and exchange information in a timely way with competent
authorities in other Member States for the purposes of this Regulation, including after any referral of the relevant
infringements to the competent judicial authorities for criminal prosecution.
(60) It is necessary to reinforce provisions on exchange of information between competent authorities and to
strengthen the duties of assistance and cooperation which they owe to each other. Due to increasing cross-border
activity, competent authorities should provide each other with the relevant information for the exercise of their
function, so as to ensure the effective enforcement of this Regulation, including in situations where an
infringement or suspected infringement is of concern to authorities in two or more Member States. When
exchanging information, strict professional secrecy is needed to ensure the smooth transmission of that
information and the protection of particular rights.
(61) In order to ensure that decisions made by competent authorities to impose an administrative sanction or other
administrative measure have a deterrent effect on the public at large, they should be published. The publication of
decisions imposing an administrative sanction or other administrative measure is also an important tool for
competent authorities to inform market participants of the type of behaviour that is considered to infringe this
Regulation and to promote wider good behaviour amongst market participants. If such publication risks causing
disproportionate damage to the persons involved, or jeopardises the stability of financial markets or an on-going
investigation, the competent authority should either publish the administrative sanction or other administrative
measure on an anonymous basis or delay the publication. In addition, competent authorities should have the
option not to publish a decision imposing administrative sanctions or other administrative measures at all where
anonymous or delayed publication is considered insufficient to ensure that the stability of financial markets is not
jeopardised. Competent authorities are also not required to publish administrative sanctions or other adminis
trative measures which are deemed to be of a minor nature where publication would be disproportionate.
(62) Critical benchmarks can involve contributors, administrators and users in more than one Member State. Thus, the
cessation of the provision of such a benchmark or any events that can significantly undermine its integrity could
have an impact in more than one Member State, meaning that the supervision of such a benchmark only by the
competent authority of the Member State in which the administrator of the benchmark is located will not be
efficient and effective in terms of addressing the risks that the critical benchmark poses. In such a case, in order
to ensure the effective exchange of supervisory information among competent authorities and coordination of
their activities and supervisory measures, colleges, comprising competent authorities and ESMA, should be
formed. The activities of the colleges should contribute to the harmonised application of rules under this
Regulation and to the convergence of supervisory practices. The competent authority of the administrator should
establish written arrangements regarding the exchange of information, the decision-making process, which could
include rules on voting procedures, any cooperation for the purposes of mandatory contribution measures, and
the cases where the competent authorities should consult each other. ESMA's legally binding mediation is a key
element of the achievement of coordination, supervisory consistency and convergence of supervisory practices.
(63) Benchmarks can reference financial instruments and financial contracts that have a long duration. In certain
cases, such benchmarks risk no longer being permitted to be provided once this Regulation comes into effect
because they have characteristics that cannot be adjusted to conform to the requirements of this Regulation. At
the same time, prohibiting the continued provision of such a benchmark could result in the termination or
frustration of the financial instruments or financial contracts and so harm investors. It is therefore necessary to
make provision to allow for the continued provision of such benchmarks for a transitional period.
(64) In cases where this Regulation captures or potentially captures supervised entities and markets covered by
Regulation (EU) No 1227/2011, the Agency for the Cooperation of Energy Regulators (ACER) would need to be
consulted by ESMA in order to draw upon ACER's expertise in energy markets and to mitigate any dual
regulation.
(65) In order to specify further technical elements of this Regulation, the power to adopt acts in accordance with
Article 290 of TFEU should be delegated to the Commission in respect of the specification of technical elements
of definitions; in respect of the calculation of the nominal amounts of financial instruments, notional amount of
derivatives and the net asset value of investment funds referencing a benchmark to determine whether such
benchmark is critical; in respect of reviewing the calculation method used to determine the threshold for the de
termination of critical and significant benchmarks; in respect of establishing the objective reasons for the
endorsement of a benchmark or family of benchmarks provided in a third country; in respect of establishing the
elements to assess whether the cessation or the changing of an existing benchmark could reasonably result in a
force majeure event, frustrate or otherwise breach the terms of any financial contract or financial instrument, or
the rules of any investment fund, which references such benchmark; and in respect of the extension of the 24-
month period envisaged for the registration instead of authorisation of certain administrators. When adopting
those acts, the Commission should take into account the market or technological developments and the internat
ional convergence of supervisory practice in relation to benchmarks, in particular the work of IOSCO. It is of
particular importance that the Commission carry out appropriate consultations during its preparatory work,
including at expert level, and that those consultations be conducted in accordance with the principles laid down
in the Interinstitutional Agreement between the European Parliament, the Council of the European Union and the
European Commission on Better Law-Making (1) of 13 April 2016. In particular, to ensure equal participation in
the preparation of delegated acts, the European Parliament and the Council receive all documents at the same
time as Member States' experts, and their experts systematically have access to meetings of Commission expert
groups dealing with the preparation of delegated acts.
(66) Technical standards should ensure consistent harmonisation of the requirements for the provision of and
contribution to indices used as benchmarks and adequate protection of investors and consumers across the
Union. As a body with highly specialised expertise, it would be efficient and appropriate to entrust ESMA with
the elaboration of draft regulatory technical standards which do not involve policy choices for submission to the
Commission. The Commission should adopt draft regulatory technical standards developed by ESMA by means
of delegated acts pursuant to Article 290 TFEU and in accordance with Articles 10 to 14 of Regulation (EU)
No 1095/2010, regarding the procedures and the characteristics of the oversight function; regarding how to
ensure the appropriateness and the verifiability of the input data as well as the internal oversight and verification
procedures of a contributor; regarding the information to be provided by an administrator about the benchmark
and methodology; regarding the elements of the code of conduct; regarding the requirements concerning systems
and controls; regarding the criteria that the competent authority should take into account when deciding whether
to apply certain additional requirements; regarding the contents of the benchmark statement and the cases in
which an update of such a statement is required; regarding the minimum content of the cooperation
arrangements between the competent authorities and ESMA; regarding the form and content of the application
for recognition of a third country administrator and presentation of the information that is to be provided with
such an application; and regarding the information to be provided in the application for authorisation or
registration.
(67) In order to ensure uniform conditions for the implementation of this Regulation, implementing powers should
be conferred on the Commission to establish and review a list of public authorities in the Union, to establish and
review the list of critical benchmarks, and to determine the equivalence of the legal framework to which
providers of benchmarks of third countries are subject for the purposes of full or partial equivalence. Those
powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of
the Council (2).
(68) The Commission should also be empowered to adopt implementing technical standards developed by ESMA
establishing templates for the compliance statements, procedures and forms for exchange of information between
competent authorities and ESMA, by means of implementing acts pursuant to Article 291 TFEU and in
accordance with Article 15 of Regulation (EU) No 1095/2010.
(1) OJ L 123, 12.5.2016, p. 1.

(2) Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general
principles concerning mechanisms for control by Member States of the Commission's exercise of implementing powers (OJ L 55,
28.2.2011, p. 13).
(69) Since the objectives of this Regulation, namely to lay down a consistent and effective regime to address the
vulnerabilities that benchmarks pose, cannot be sufficiently achieved by the Member States, given that the overall
impact of the problems relating to benchmarks can be fully perceived only in a Union context, but can rather, by
reason of the scale and effects of this Regulation, be better achieved at Union level, the Union may adopt
measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European
Union. In accordance with the principle of proportionality as set out in that Article, this Regulation does not go
beyond what is necessary in order to achieve those objectives.
(70) Given the urgency of the need to restore confidence in benchmarks and promote fair and transparent financial
markets, this Regulation should enter into force on the day following that of its publication.
(71) Consumers are able to enter into financial contracts, in particular mortgages and consumer credit contracts, that
reference a benchmark, but unequal bargaining power and the use of standard terms mean that they can have a
limited choice about the benchmark used. It is therefore necessary to ensure that at least adequate information is
provided by creditors or credit intermediaries to consumers. To that end, Directives 2008/48/EC and 2014/17/EU
should therefore be amended accordingly.
(72) Regulation (EU) No 596/2014 requires persons discharging managerial responsibilities, as well as persons closely
associated with them, to notify the issuer and the competent authority of every transaction conducted on their
own account relating to financial instruments that are themselves linked to shares and debt instruments of their
issuer. However, there are a variety of financial instruments that are linked to shares and debt instruments of a
given issuer. Such financial instruments include units in collective investment undertakings, structured products
or financial instruments embedding a derivative that provides exposure to the performance of shares or debt
instruments issued by an issuer. Every transaction in such financial instruments above a de minimis threshold
should be subject to notification to the issuer and the competent authority. An exception should be made where
either the linked financial instrument provides an exposure of 20 % or less to the issuer's shares or debt
instruments, or the person discharging managerial responsibilities or person closely associated with them did not
and could not know the investment composition of the linked financial instrument. Regulation (EU)
No 596/2014 should therefore be amended,
HAVE ADOPTED THIS REGULATION:
TITLE I
SUBJECT MATTER, SCOPE AND DEFINITIONS
Article 1
Subject-matter
This Regulation introduces a common framework to ensure the accuracy and integrity of indices used as benchmarks in
financial instruments and financial contracts, or to measure the performance of investment funds in the Union. This
Regulation thereby contributes to the proper functioning of the internal market while achieving a high level of
consumer and investor protection.
Article 2
Scope
1. This Regulation applies to the provision of benchmarks, the contribution of input data to a benchmark and the
use of a benchmark within the Union.
2. This Regulation shall not apply to:
(a) a central bank;
(b) a public authority, where it contributes data to, provides, or has control over the provision of, benchmarks for
public policy purposes, including measures of employment, economic activity, and inflation;
(c) a central counterparty (CCP), where it provides reference prices or settlement prices used for CCP risk-management
purposes and settlement;
(d) the provision of a single reference price for any financial instrument listed in Section C of Annex I to Directive
2014/65/EU;
(e) the press, other media and journalists where they merely publish or refer to a benchmark as part of their
journalistic activities with no control over the provision of that benchmark;
(f) a natural or legal person that grants or promises to grant credit in the course of that person's trade, business or
profession, only insofar as that person publishes or makes available to the public that person's own variable or fixed
borrowing rates set by internal decisions and applicable only to financial contracts entered into by that person or by
a company within the same group with their respective clients;
(g) a commodity benchmark based on submissions from contributors the majority of which are non-supervised entities
and in respect of which both of the following conditions apply:
(i) the benchmark is referenced by financial instruments for which a request for admission to trading has been
made on only one trading venue, as defined in point (24) of Article 4(1) of Directive 2014/65/EU, or which are
traded on only one such trading venue;
(ii) the total notional value of financial instruments referencing the benchmark does not exceed EUR 100 million;
(h) an index provider in respect of an index provided by said provider where that index provider is unaware and could
not reasonably have been aware that that index is used for the purposes referred to in point (3) of Article 3(1).
Article 3
Definitions
1. For the purposes of this Regulation, the following definitions apply:
(1) ‘index’ means any figure:
(a) that is published or made available to the public;
(b) that is regularly determined:
(i) entirely or partially by the application of a formula or any other method of calculation, or by an
assessment; and
(ii) on the basis of the value of one or more underlying assets or prices, including estimated prices, actual or
estimated interest rates, quotes and committed quotes, or other values or surveys;
(2) ‘index provider’ means a natural or legal person that has control over the provision of an index;
(3) ‘benchmark’ means any index by reference to which the amount payable under a financial instrument or a financial
contract, or the value of a financial instrument, is determined, or an index that is used to measure the performance
of an investment fund with the purpose of tracking the return of such index or of defining the asset allocation of a
portfolio or of computing the performance fees;
(4) ‘family of benchmarks’ means a group of benchmarks provided by the same administrator and determined from
input data of the same nature which provides specific measures of the same or similar market or economic reality;
(5) ‘provision of a benchmark’ means:
(a) administering the arrangements for determining a benchmark;
(b) collecting, analysing or processing input data for the purpose of determining a benchmark; and
(c) determining a benchmark through the application of a formula or other method of calculation or by an
assessment of input data provided for that purpose;
(6) ‘administrator’ means a natural or legal person that has control over the provision of a benchmark;
(7) ‘use of a benchmark’ means:
(a) issuance of a financial instrument which references an index or a combination of indices;
(b) determination of the amount payable under a financial instrument or a financial contract by referencing an
index or a combination of indices;
(c) being a party to a financial contract which references an index or a combination of indices;
(d) providing a borrowing rate as defined in point (j) of Article 3 of Directive 2008/48/EC calculated as a spread
or mark-up over an index or a combination of indices and that is solely used as a reference in a financial
contract to which the creditor is a party;
(e) measuring the performance of an investment fund through an index or a combination of indices for the
purpose of tracking the return of such index or combination of indices, of defining the asset allocation of a
portfolio, or of computing the performance fees;
(8) ‘contribution of input data’ means providing any input data not readily available to an administrator, or to another
person for the purposes of passing to an administrator, that is required in connection with the determination of a
benchmark, and is provided for that purpose;
(9) ‘contributor’ means a natural or legal person contributing input data;
(10) ‘supervised contributor’ means a supervised entity that contributes input data to an administrator located in the
Union;
(11) ‘submitter’ means a natural person employed by the contributor for the purpose of contributing input data;
(12) ‘assessor’ means an employee of an administrator of a commodity benchmark, or any other natural person whose
services are placed at the administrator's disposal or under the control of the administrator, and who is responsible
for applying a methodology or judgement to input data and other information to reach a conclusive assessment
about the price of a certain commodity;
(13) ‘expert judgement’ means the exercise of discretion by an administrator or a contributor with respect to the use of
data in determining a benchmark, including extrapolating values from prior or related transactions, adjusting
values for factors that might influence the quality of data such as market events or impairment of a buyer or
seller's credit quality, and weighting firm bids or offers greater than a particular concluded transaction;
(14) ‘input data’ means the data in respect of the value of one or more underlying assets, or prices, including estimated
prices, quotes, committed quotes or other values, used by an administrator to determine a benchmark;
(15) ‘transaction data’ means observable prices, rates, indices or values representing transactions between unaffiliated
counterparties in an active market subject to competitive supply and demand forces;
(16) ‘financial instrument’ means any of the instruments listed in Section C of Annex I to Directive 2014/65/EU for
which a request for admission to trading on a trading venue, as defined in point (24) of Article 4(1) of Directive
2014/65/EU, has been made or which is traded on a trading venue as defined in point (24) of Article 4(1) of
Directive 2014/65/EU or via a systematic internaliser as defined in point (20) of Article 4(1) of that Directive;
(17) ‘supervised entity’ means any of the following:
(a) a credit institution as defined in point (1) of Article 4(1) of Regulation (EU) No 575/2013 of the European
Parliament and of the Council (1);
(b) an investment firm as defined in point (1) of Article 4(1) of Directive 2014/65/EU;
(c) an insurance undertaking as defined in point (1) of Article 13 of Directive 2009/138/EC of the European
(d) a reinsurance undertaking as defined in point (4) of Article 13 of Directive 2009/138/EC;
(e) a UCITS as defined in Article 1(2) of Directive 2009/65/EC or, where applicable, a UCITS management
company as defined in point (b) of Article 2(1) of that Directive;
(f) an alternative investment fund manager (AIFM) as defined in point (b) of Article 4(1) of Directive 2011/61/EU
of the European Parliament and of the Council (3);
(g) an institution for occupational retirement provision as defined in point (a) of Article 6 of Directive
2003/41/EC of the European Parliament and of the Council (4);
(h) a creditor as defined in point (b) of Article 3 of Directive 2008/48/EC for the purposes of credit agreements as
defined in point (c) of Article 3 of that Directive;
(i) a non-credit institution as defined in point (10) of Article 4 of Directive 2014/17/EU for the purposes of
credit agreements as defined in point (3) of Article 4 of that Directive;
(j) a market operator as defined in point (18) of Article 4(1) of Directive 2014/65/EU;
(k) a CCP as defined in point (1) of Article 2 of Regulation (EU) No 648/2012 of the European Parliament and of
the Council (5);
(l) a trade repository as defined in point (2) of Article 2 of Regulation (EU) No 648/2012;
(m) an administrator;
(18) ‘financial contract’ means:
(a) any credit agreement as defined in point (c) of Article 3 of Directive 2008/48/EC;
(b) any credit agreement as defined in point (3) of Article 4 of Directive 2014/17/EU;
(19) ‘investment fund’ means an AIF as defined in point (a) of Article 4(1) of Directive 2011/61/EU, or a UCITS as
defined in Article 1(2) of Directive 2009/65/EC;
(1) Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit
institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1).
(2) Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the
business of Insurance and Reinsurance (Solvency II) (OJ L 335, 17.12.2009, p. 1).
(3) Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund Managers and
amending Directives 2003/41/EC and 2009/65/EC and Regulations (EC) No 1060/2009 and (EU) No 1095/2010 (OJ L 174, 1.7.2011,
p. 1).
(4) Directive 2003/41/EC of the European Parliament and of the Council of 3 June 2003 on the activities and supervision of institutions for
occupational retirement provision (OJ L 235, 23.9.2003, p. 10).
(5) Regulation (EU) No 648/2012 of the European Parliament and of the Council of 4 July 2012 on OTC derivatives, central counterparties
and trade repositories (OJ L 201, 27.7.2012, p. 1).
(20) ‘management body’ means the body or bodies of an administrator or another supervised entity which are
appointed in accordance with national law, which are empowered to set the strategy, objectives and overall
direction of the administrator or other supervised entity, and which oversee and monitor management decision-
making and include persons who effectively direct the business of the administrator or other supervised entity;
(21) ‘consumer’ means a natural person who, in financial contracts covered by this Regulation, is acting for purposes
which are outside his or her trade, business or profession;
(22) ‘interest rate benchmark’ means a benchmark which for the purposes of point (1)(b)(ii) of this paragraph is
determined on the basis of the rate at which banks may lend to, or borrow from, other banks, or agents other than
banks, in the money market;
(23) ‘commodity benchmark’ means a benchmark where the underlying asset for the purposes of point (1)(b)(ii) of this
paragraph is a commodity within the meaning of point (1) of Article 2 of Commission Regulation (EC)
No 1287/2006 (1), excluding emission allowances as referred to in point (11) of Section C of Annex I to Directive
2014/65/EU;
(24) ‘regulated-data benchmark’ means a benchmark determined by the application of a formula from:
(a) input data contributed entirely and directly from:
(i) a trading venue as defined in point (24) of Article 4(1) of Directive 2014/65/EU or a trading venue in a
third country for which the Commission has adopted an implementing decision that the legal and
supervisory framework of that country is considered to have equivalent effect within the meaning of
Article 28(4) of Regulation (EU) No 600/2014 of the European Parliament and of the Council (2), or a
regulated market considered to be equivalent under Article 2a of Regulation (EU) No 648/2012, but in
each case only with reference to transaction data concerning financial instruments;
(ii) an approved publication arrangement as defined in point (52) of Article 4(1) of Directive 2014/65/EU or
a consolidated tape provider as defined in point (53) of Article 4(1) of Directive 2014/65/EU, in
accordance with mandatory post-trade transparency requirements, but only with reference to transaction
data concerning financial instruments that are traded on a trading venue;
(iii) an approved reporting mechanism as defined in point (54) of Article 4(1) of Directive 2014/65/EU, but
only with reference to transaction data concerning financial instruments that are traded on a trading
venue and that must be disclosed in accordance with mandatory post-trade transparency requirements;
(iv) an electricity exchange as referred to in point (j) of Article 37(1) of Directive 2009/72/EC of the European
(v) a natural gas exchange as referred to in point (j) of Article 41(1) of Directive 2009/73/EC of the European
(vi) an auction platform referred to in Article 26 or 30 of Commission Regulation (EU) No 1031/2010 (5);
(vii) a service provider to which the benchmark administrator has outsourced the data collection in accordance
with Article 10, provided that the service provider receives the data entirely and directly from an entity
referred to in points (i) to (vi);
(b) net asset values of investment funds;
(1) Commission Regulation (EC) No 1287/2006 of 10 August 2006 implementing Directive 2004/39/EC of the European Parliament and of
the Council as regards record-keeping obligations for investment firms, transaction reporting, market transparency, admission of
financial instruments to trading, and defined terms for the purposes of that Directive (OJ L 241, 2.9.2006, p. 1).
(2) Regulation (EU) No 600/2014 of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and
amending Regulation (EU) No 648/2012 (OJ L 173, 12.6.2014, p. 84).
(3) Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market
in electricity and repealing Directive 2003/54/EC (OJ L 211, 14.8.2009, p. 55).
(4) Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market
in natural gas and repealing Directive 2003/55/EC (OJ L 211, 14.8.2009, p. 94).
(5) Commission Regulation (EU) No 1031/2010 of 12 November 2010 on the timing, administration and other aspects of auctioning of
greenhouse gas emission allowances pursuant to Directive 2003/87/EC of the European Parliament and of the Council establishing a
scheme for greenhouse gas emission allowances trading within the Community (OJ L 302, 18.11.2010, p. 1).
(25) ‘critical benchmark’ means a benchmark other than a regulated-data benchmark that fulfils any of the conditions
laid down in Article 20(1) and which is on the list established by the Commission pursuant to that Article;
(26) ‘significant benchmark’ means a benchmark that fulfils the conditions laid down in Article 24(1);
(27) ‘non-significant benchmark’ means a benchmark that does not fulfil the conditions laid down in Articles 20(1) and
24(1);
(28) ‘located’ means, in relation to a legal person, the country where that person's registered office or other official
address is situated and, in relation to a natural person, the country where that person is resident for tax purposes;
(29) ‘public authority’ means:
(a) any government or other public administration, including the entities charged with or intervening in the
management of the public debt;
(b) any entity or person either performing public administrative functions under national law or having public
responsibilities or functions or providing public services, including measures of employment, economic
activities and inflation, under the control of an entity within the meaning of point (a).
2. The Commission shall be empowered to adopt delegated acts in accordance with Article 49 in order to specify
further technical elements of the definitions laid down in paragraph 1 of this Article, in particular specifying what
constitutes making available to the public for the purposes of the definition of an index.
Where applicable, the Commission shall take into account the market or technological developments and the internat
ional convergence of supervisory practice in relation to benchmarks.
3. The Commission shall adopt implementing acts in order to establish and review a list of public authorities in the
Union falling within the definition under point (29) of paragraph 1 of this Article. Those implementing acts shall be
adopted in accordance with the examination procedure referred to in Article 50(2).
Where applicable, the Commission shall take into account the market or technological developments and the internat
ional convergence of supervisory practice in relation to benchmarks.
TITLE II
BENCHMARK INTEGRITY AND RELIABILITY
CHAPTER 1
Governance of and control by administrators
Article 4
Governance and conflict of interest requirements
1. An administrator shall have in place robust governance arrangements which include a clear organisational
structure with well-defined, transparent and consistent roles and responsibilities for all persons involved in the provision
of a benchmark.
Administrators shall take adequate steps to identify and to prevent or manage conflicts of interest between themselves,
including their managers, employees or any person directly or indirectly linked to them by control, and contributors or
users, and to ensure that, where any judgement or discretion in the benchmark determination process is required, it is in
dependently and honestly exercised.
2. The provision of a benchmark shall be operationally separated from any part of an administrator's business that
may create an actual or potential conflict of interest.
3. Where a conflict of interest arises within an administrator due to the latter's ownership structure, controlling
interests or other activities conducted by any entity owning or controlling the administrator or by an entity that is
owned or controlled by the administrator or any of the administrator's affiliates, that cannot be adequately mitigated, the
relevant competent authority may require the administrator to establish an independent oversight function which shall
include a balanced representation of stakeholders, including users and contributors.
4. If such a conflict of interest cannot be adequately managed, the relevant competent authority may require the
administrator to either cease the activities or relationships that create the conflict of interest or cease providing the
benchmark.
5. An administrator shall publish or disclose all existing or potential conflicts of interest to users of a benchmark, to
the relevant competent authority and, where relevant, to contributors, including conflicts of interest arising from the
ownership or control of the administrator.
6. An administrator shall establish and operate adequate policies and procedures, as well as effective organisational
arrangements, for the identification, disclosure, prevention, management and mitigation of conflicts of interest in order
to protect the integrity and independence of benchmark determinations. Such policies and procedures shall be regularly
reviewed and updated. The policies and procedures shall take into account and address conflicts of interest, the degree
of discretion exercised in the benchmark determination process and the risks that the benchmark poses, and shall:
(a) ensure the confidentiality of information contributed to or produced by the administrator, subject to the disclosure
and transparency obligations under this Regulation; and
(b) specifically mitigate conflicts of interest due to the administrator's ownership or control, or due to other interests in
the administrator's group or as a result of other persons that may exercise influence or control over the adminis
trator in relation to determining the benchmark.
7. Administrators shall ensure that their employees and any other natural persons whose services are placed at their
disposal or under their control and who are directly involved in the provision of a benchmark:
(a) have the necessary skills, knowledge and experience for the duties assigned to them and are subject to effective
management and supervision;
(b) are not subject to undue influence or conflicts of interest and that the compensation and performance evaluation of
those persons do not create conflicts of interest or otherwise impinge upon the integrity of the benchmark determi
nation process;
(c) do not have any interests or business connections that compromise the activities of the administrator concerned;
(d) are prohibited from contributing to a benchmark determination by way of engaging in bids, offers and trades on a
personal basis or on behalf of market participants, except where such way of contribution is explicitly required as
part of the benchmark methodology and is subject to specific rules therein; and
(e) are subject to effective procedures to control the exchange of information with other employees involved in activities
that may create a risk of conflicts of interest or with third parties, where that information may affect the benchmark.
8. An administrator shall establish specific internal control procedures to ensure the integrity and reliability of the
employee or person determining the benchmark, including at least internal sign-off by management before the dissemi
nation of the benchmark.
Article 5
Oversight function requirements
1. Administrators shall establish and maintain a permanent and effective oversight function to ensure oversight of all
aspects of the provision of their benchmarks.
2. Administrators shall develop and maintain robust procedures regarding their oversight function, which shall be
made available to the relevant competent authorities.
3. The oversight function shall operate with integrity and shall have the following responsibilities, which shall be
adjusted by the administrator based on the complexity, use and vulnerability of the benchmark:
(a) reviewing the benchmark's definition and methodology at least annually;
(b) overseeing any changes to the benchmark methodology and being able to request the administrator to consult on
such changes;
(c) overseeing the administrator's control framework, the management and operation of the benchmark, and, where the
benchmark is based on input data from contributors, the code of conduct referred to in Article 15;
(d) reviewing and approving procedures for cessation of the benchmark, including any consultation about a cessation;
(e) overseeing any third party involved in the provision of the benchmark, including calculation or dissemination
agents;
(f) assessing internal and external audits or reviews, and monitoring the implementation of identified remedial actions;
(g) where the benchmark is based on input data from contributors, monitoring the input data and contributors and the
actions of the administrator in challenging or validating contributions of input data;
(h) where the benchmark is based on input data from contributors, taking effective measures in respect of any breaches
of the code of conduct referred to in Article 15; and
(i) reporting to the relevant competent authorities any misconduct by contributors, where the benchmark is based on
input data from contributors, or administrators, of which the oversight function becomes aware, and any anomalous
or suspicious input data.
4. The oversight function shall be carried out by a separate committee or by means of another appropriate
governance arrangement.
5. ESMA shall develop draft regulatory technical standards to specify the procedures regarding the oversight function
and the characteristics of the oversight function including its composition as well as its positioning within the organisa
tional structure of the administrator, so as to ensure the integrity of the function and the absence of conflicts of interest.
In particular, ESMA shall develop a non-exhaustive list of appropriate governance arrangements as laid down in
paragraph 4.
ESMA shall distinguish between the different types of benchmarks and sectors as set out in this Regulation and shall
take into consideration the differences in the ownership and control structure of administrators, the nature, scale and
complexity of the provision of the benchmark, and the risk and impact of the benchmark, also in light of international
convergence of supervisory practice in relation to governance requirements of benchmarks. However, the ESMA draft
regulatory technical standards shall not cover or apply to administrators of non-significant benchmarks.
ESMA shall submit those draft regulatory technical standards to the Commission by 1 April 2017.
Power is delegated to the Commission to adopt the regulatory technical standards referred to in the first subparagraph in
accordance with the procedure laid down in Articles 10 to 14 of Regulation (EU) No 1095/2010.
6. ESMA may issue guidelines in accordance with Article 16 of Regulation (EU) No 1095/2010, addressed to adminis
trators of non-significant benchmarks to specify the elements referred to in paragraph 5 of this Article.
Article 6
Control framework requirements
1. Administrators shall have in place a control framework that ensures that their benchmarks are provided and
published or made available in accordance with this Regulation.
2. The control framework shall be proportionate to the level of conflicts of interest identified, the extent of discretion
in the provision of the benchmark and the nature of the benchmark input data.
3. The control framework shall include:
(a) management of operational risk;
(b) adequate and effective business continuity and disaster recovery plans;
(c) contingency procedures that are in place in the event of a disruption to the process of the provision of the
benchmark.
4. An administrator shall establish measures to:
(a) ensure that contributors adhere to the code of conduct referred to in Article 15 and comply with the applicable
standards for input data;
(b) monitor input data including, where feasible, monitoring input data before publication of the benchmark and
validating input data after publication to identify errors and anomalies.
5. The control framework shall be documented, reviewed and updated as appropriate and made available to the
relevant competent authority and, upon request, to users.
Article 7
Accountability framework requirements
1. An administrator shall have in place an accountability framework, covering record-keeping, auditing and review,
and a complaints process, that provides evidence of compliance with the requirements of this Regulation.
2. An administrator shall designate an internal function with the necessary capability to review and report on the
administrator's compliance with the benchmark methodology and this Regulation.
3. For critical benchmarks, an administrator shall appoint an independent external auditor to review and report on
the administrator's compliance with the benchmark methodology and this Regulation, at least annually.
4. Upon the request of the relevant competent authority, an administrator shall provide to the relevant competent
authority the details of the reviews and reports provided for in paragraph 2. Upon the request of the relevant competent
authority or any user of a benchmark, an administrator shall publish the details of the audits provided for in
paragraph 3.
Article 8
Record-keeping requirements
1. An administrator shall keep records of:
(a) all input data, including the use of such data;
(b) the methodology used for the determination of a benchmark;
(c) any exercise of judgement or discretion by the administrator and, where applicable, by assessors, in the determina
tion of a benchmark, including the reasoning for said judgement or discretion;
(d) the disregard of any input data, in particular where it conformed to the requirements of the benchmark
methodology, and the rationale for such disregard;
(e) other changes in or deviations from standard procedures and methodologies, including those made during periods
of market stress or disruption;
(f) the identities of the submitters and of the natural persons employed by the administrator for the determination of a
benchmark;
(g) all documents relating to any complaint, including those submitted by a complainant; and
(h) telephone conversations or electronic communications between any person employed by the administrator and
contributors or submitters in respect of a benchmark.
2. An administrator shall keep the records set out in paragraph 1 for at least five years in such a form that it is
possible to replicate and fully understand the determination of a benchmark and enable an audit or evaluation of input
data, calculations, judgements and discretion. Records of telephone conversation or electronic communications recorded
in accordance with point (h) of paragraph 1 shall be provided to the persons involved in the conversation or communi
cation upon request and shall be kept for a period of three years.
Article 9
Complaints-handling mechanism
1. An administrator shall have in place and publish procedures for receiving, investigating and retaining records
concerning complaints made, including about the administrator's benchmark determination process.
2. Such a complaints-handling mechanism shall ensure that:
(a) the administrator makes available the complaints-handling policy through which complaints may be submitted on
whether a specific benchmark determination is representative of market value, on a proposed change to the
benchmark determination process, on an application of the methodology in relation to a specific benchmark deter
mination, and on other decisions in relation to the benchmark determination process;
(b) complaints are investigated in a timely and fair manner and the outcome of the investigation is communicated to
the complainant within a reasonable period of time, unless such communication would be contrary to objectives of
public policy or to Regulation (EU) No 596/2014; and
(c) the inquiry is conducted independently of any personnel who may be or may have been involved in the subject-
matter of the complaint.
Article 10
Outsourcing
1. An administrator shall not outsource functions in the provision of a benchmark in such a way as to impair
materially the administrator's control over the provision of the benchmark or the ability of the relevant competent
authority to supervise the benchmark.
2. Where an administrator outsources to a service provider functions or any relevant services and activities in the
provision of a benchmark, the administrator shall remain fully responsible for discharging all of the administrator's
obligations under this Regulation.
3. Where outsourcing takes place, the administrator shall ensure that the following conditions are fulfilled:
(a) the service provider has the ability, capacity, and any authorisation required by law, to perform the outsourced
functions, services or activities reliably and professionally;
(b) the administrator makes available to the relevant competent authorities the identity and the tasks of the service
provider that participates in the benchmark determination process;
(c) the administrator takes appropriate action if it appears that the service provider may not be carrying out the
outsourced functions effectively and in compliance with applicable law and regulatory requirements;
(d) the administrator retains the necessary expertise to supervise the outsourced functions effectively and to manage the
risks associated with the outsourcing;
(e) the service provider discloses to the administrator any development that may have a material impact on its ability to
carry out the outsourced functions effectively and in compliance with applicable law and regulatory requirements;
(f) the service provider cooperates with the relevant competent authority regarding the outsourced activities, and the
administrator and the relevant competent authority have effective access to data related to the outsourced activities,
as well as to the business premises of the service provider, and the relevant competent authority is able to exercise
those rights of access;
(g) the administrator is able to terminate the outsourcing arrangements where necessary;
(h) the administrator takes reasonable steps, including contingency plans, to avoid undue operational risk related to the
participation of the service provider in the benchmark determination process.
CHAPTER 2
Input data, methodology and reporting of infringements
Article 11
Input data
1. The provision of a benchmark shall be governed by the following requirements in respect of its input data:
(a) the input data shall be sufficient to represent accurately and reliably the market or economic reality that the
benchmark is intended to measure.
The input data shall be transaction data, if available and appropriate. If transaction data is not sufficient or is not
appropriate to represent accurately and reliably the market or economic reality that the benchmark is intended to
measure, input data which is not transaction data may be used, including estimated prices, quotes and committed
quotes, or other values;
(b) the input data referred to in point (a) shall be verifiable;
(c) the administrator shall draw up and publish clear guidelines regarding the types of input data, the priority of use of
the different types of input data and the exercise of expert judgement, to ensure compliance with point (a) and the
methodology;
(d) where a benchmark is based on input data from contributors, the administrator shall obtain, where appropriate, the
input data from a reliable and representative panel or sample of contributors so as to ensure that the resulting
benchmark is reliable and representative of the market or economic reality that the benchmark is intended to
measure;
(e) the administrator shall not use input data from a contributor if the administrator has any indication that the
contributor does not adhere to the code of conduct referred to in Article 15, and in such a case shall obtain rep
resentative publicly available data.
2. Administrators shall ensure that their controls in respect of input data include:
(a) criteria that determine who may contribute input data to the administrator and a process for selecting contributors;
(b) a process for evaluating a contributor's input data and for stopping the contributor from providing further input
data, or applying other penalties for non-compliance against the contributor, where appropriate; and
(c) a process for validating input data, including against other indicators or data, to ensure its integrity and accuracy.
3. Where the input data of a benchmark is contributed from a front office function, meaning any department,
division, group, or personnel of contributors or any of its affiliates that performs any pricing, trading, sales, marketing,
advertising, solicitation, structuring, or brokerage activities, the administrator shall:
(a) obtain data from other sources that corroborate that input data; and
(b) ensure that contributors have in place adequate internal oversight and verification procedures.
4. Where an administrator considers that the input data does not represent the market or economic reality that a
benchmark is intended to measure, that administrator shall, within a reasonable time period, either change the input
data, the contributors or the methodology in order to ensure that the input data does represent such market or
economic reality, or else cease to provide that benchmark.
5. ESMA shall develop draft regulatory technical standards to specify further how to ensure that input data is
appropriate and verifiable, as required under points (a) and (b) of paragraph 1, as well as the internal oversight and
verification procedures of a contributor that the administrator has to ensure are in place, in compliance with point (b) of
paragraph 3, in order to ensure the integrity and accuracy of input data. However, the ESMA draft regulatory technical
standards shall not cover or apply to administrators of non-significant benchmarks.
ESMA shall take into account the different types of benchmarks and sectors as set out in this Regulation, the nature of
input data, the characteristics of the underlying market or economic reality and the principle of proportionality, the
vulnerability of the benchmarks to manipulation as well as the international convergence of supervisory practice in
relation to benchmarks.
trators of non-significant benchmarks to specify the elements referred to in paragraph 5 of this Article.
Article 12
Methodology
1. An administrator shall use a methodology for determining a benchmark that:
(a) is robust and reliable;
(b) has clear rules identifying how and when discretion may be exercised in the determination of that benchmark;
(c) is rigorous, continuous and capable of validation including, where appropriate, back-testing against available
transaction data;
(d) is resilient and ensures that the benchmark can be calculated in the widest set of possible circumstances, without
compromising its integrity;
(e) is traceable and verifiable.
2. When developing a benchmark methodology, a benchmark administrator shall:
(a) take into account factors including the size and normal liquidity of the market, the transparency of trading and the
positions of market participants, market concentration, market dynamics, and the adequacy of any sample to
represent the market or economic reality that the benchmark is intended to measure;
(b) determine what constitutes an active market for the purposes of that benchmark; and
(c) establish the priority given to different types of input data.
3. An administrator shall have in place clear published arrangements that identify the circumstances in which the
quantity or quality of input data falls below the standards necessary for the methodology to determine the benchmark
accurately and reliably, and that describe whether and how the benchmark is to be calculated in such circumstances.
Article 13
Transparency of methodology
1. An administrator shall develop, operate and administer the benchmark and methodology transparently. To that
end, the administrator shall publish or make available the following information:
(a) the key elements of the methodology that the administrator uses for each benchmark provided and published or,
when applicable, for each family of benchmarks provided and published;
(b) details of the internal review and the approval of a given methodology, as well as the frequency of such review;
(c) the procedures for consulting on any proposed material change in the administrator's methodology and the rationale
for such changes, including a definition of what constitutes a material change and the circumstances in which the
administrator is to notify users of any such changes.
2. The procedures required under point (c) of paragraph 1 shall provide for:
(a) advance notice, with a clear time frame, that gives the opportunity to analyse and comment upon the impact of
such proposed material changes; and
(b) the comments referred to in point (a) of this paragraph, and the administrator's response to those comments, to be
made accessible after any consultation, except where confidentiality has been requested by the originator of the
comments.
3. ESMA shall develop draft regulatory technical standards to specify further the information to be provided by an
administrator in compliance with the requirements laid down in paragraphs 1 and 2, distinguishing for different types of
benchmarks and sectors as set out in this Regulation. ESMA shall take into account the need to disclose those elements
of the methodology that provide for sufficient detail to allow users to understand how a benchmark is provided and to
assess its representativeness, its relevance to particular users and its appropriateness as a reference for financial
instruments and contracts and the principle of proportionality. However, the ESMA draft regulatory technical standards
shall not cover or apply to administrators of non-significant benchmarks.
accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.
trators of non-significant benchmarks to specify further the elements referred to in paragraph 3 of this Article.
Article 14
Reporting of infringements
1. An administrator shall establish adequate systems and effective controls to ensure the integrity of input data in
order to be able to identify and report to the competent authority any conduct that may involve manipulation or
attempted manipulation of a benchmark, under Regulation (EU) No 596/2014.
2. An administrator shall monitor input data and contributors in order to be able to notify the competent authority
and provide all relevant information where the administrator suspects that, in relation to a benchmark, any conduct has
taken place that may involve manipulation or attempted manipulation of the benchmark, under Regulation (EU)
No 596/2014, including collusion to do so.
The competent authority of the administrator shall, where applicable, transmit such information to the relevant
authority under Regulation (EU) No 596/2014.
3. Administrators shall have procedures in place for their managers, employees and any other natural persons whose
services are placed at their disposal or under their control to report internally infringements of this Regulation.
CHAPTER 3
Code of conduct and requirements for contributors
Article 15
Code of conduct
1. Where a benchmark is based on input data from contributors, its administrator shall develop a code of conduct
for each benchmark clearly specifying contributors' responsibilities with respect to the contribution of input data and
shall ensure that such code of conduct complies with this Regulation. The administrator shall be satisfied that
contributors adhere to the code of conduct on a continuous basis and at least annually and in case of changes to it.
2. The code of conduct shall include at least the following elements:
(a) a clear description of the input data to be provided and the requirements necessary to ensure that input data is
provided in accordance with Articles 11 and 14;
(b) identification of the persons that may contribute input data to the administrator and procedures to verify the
identity of a contributor and any submitters, as well as authorisation of any submitters that contribute input data on
behalf of a contributor;
(c) policies to ensure that a contributor provides all relevant input data;
(d) the systems and controls that a contributor is required to establish, including:
(i) procedures for contributing input data, including requirements for the contributor to specify whether input data
is transaction data and whether input data conforms to the administrator's requirements;
(ii) policies on the use of discretion in contributing input data;
(iii) any requirement for the validation of input data before it is provided to the administrator;
(iv) record-keeping policies;
(v) reporting requirements concerning suspicious input data;
(vi) requirements concerning the management of conflicts of interest.
3. Administrators may develop a single code of conduct for each family of benchmarks they provide.
4. In the event that a relevant competent authority, in the use of its powers referred to in Article 41, finds that there
are elements of a code of conduct which do not comply with this Regulation, it shall notify the administrator
concerned. The administrator shall adjust the code of conduct to ensure that it complies with this Regulation within
30 days of such a notification.
5. Within 15 working days from the date of application of the decision to include a critical benchmark in the list
referred to in Article 20(1), the administrator of that critical benchmark shall notify the code of conduct to the relevant
competent authority. The relevant competent authority shall verify within 30 days whether the content of the code of
conduct complies with this Regulation. In the event that the relevant competent authority finds elements which do not
comply with this Regulation, paragraph 4 of this Article shall apply.
6. ESMA shall develop draft regulatory technical standards to specify further the elements of the code of conduct
referred to in paragraph 2 for different types of benchmarks, and in order to take account of developments in
benchmarks and financial markets.
ESMA shall take into account the different characteristics of benchmarks and contributors, in particular in terms of
differences in input data and methodologies, the risks of input data of being manipulated and international convergence
of supervisory practices in relation to benchmarks.
Article 16
Governance and control requirements for supervised contributors
1. The following governance and control requirements shall apply to a supervised contributor:
(a) the supervised contributor shall ensure that the provision of input data is not affected by any existing or potential
conflict of interest and that, where any discretion is required, it is independently and honestly exercised based on
relevant information in accordance with the code of conduct referred to in Article 15;
(b) the supervised contributor shall have in place a control framework that ensures the integrity, accuracy and reliability
of input data and that input data is provided in accordance with this Regulation and the code of conduct referred to
in Article 15.
2. A supervised contributor shall have in place effective systems and controls to ensure the integrity and reliability of
all contributions of input data to the administrator, including:
(a) controls regarding who may submit input data to an administrator including, where proportionate, a process for
sign-off by a natural person holding a position senior to that of the submitter;
(b) appropriate training for submitters, covering at least this Regulation and Regulation (EU) No 596/2014;
(c) measures for the management of conflicts of interest, including organisational separation of employees where
appropriate and consideration of how to remove incentives, created by remuneration polices, to manipulate a
benchmark;
(d) record-keeping, for an appropriate period of time, of communications in relation to provision of input data, of all
information used to enable the contributor to make each submission, and of all existing or potential conflicts of
interest including, but not limited to, the contributor's exposure to financial instruments which use a benchmark as
a reference;
(e) record-keeping of internal and external audits.
3. Where input data relies on expert judgement, supervised contributors shall establish, in addition to the systems
and controls referred to in paragraph 2, policies guiding any use of judgement or exercise of discretion and shall retain
records of the rationale for any such judgement or discretion. Where proportionate, supervised contributors shall take
into account the nature of the benchmark and its input data.
4. A supervised contributor shall fully cooperate with the administrator and the relevant competent authority in the
auditing and supervision of the provision of a benchmark and make available the information and records kept in
accordance with paragraphs 2 and 3.
5. ESMA shall develop draft regulatory technical standards to specify further the requirements concerning
governance, systems and controls, and policies set out in paragraphs 1, 2 and 3.
ESMA shall take into account the different characteristics of benchmarks and supervised contributors, in particular in
terms of differences in input data provided and methodologies used, the risks of manipulation of the input data and the
nature of the activities carried out by the supervised contributors, and the developments in benchmarks and financial
markets in light of international convergence of supervisory practices in relation to benchmarks. However, the ESMA
draft regulatory technical standards shall not cover or apply to supervised contributors of non-significant benchmarks.
6. ESMA may issue guidelines in accordance with Article 16 of Regulation (EU) No 1095/2010, addressed to
supervised contributors to non-significant benchmarks to specify the elements referred to in paragraph 5 of this Article.
TITLE III
REQUIREMENTS FOR DIFFERENT TYPES OF BENCHMARKS
CHAPTER 1
Regulated-data benchmarks
Article 17
Regulated-data benchmarks
1. Article 11(1)(d) and (e), Article 11(2) and (3), Article 14(1) and (2), and Articles 15 and 16 shall not apply to the
provision of and the contribution to regulated-data benchmarks. Article 8(1)(a) shall not apply to the provision of
regulated-data benchmarks with reference to input data that are contributed entirely and directly as specified in
point (24) of Article 3(1).
2. Articles 24 and 25 or Article 26 shall, as applicable, apply to the provision of, and the contribution to, regulated-
data benchmarks that are used directly or indirectly within a combination of benchmarks as a reference for financial
instruments or financial contracts or for measuring the performance of investment funds, having a total value of up to
EUR 500 billion, on the basis of all the range of maturities or tenors of the benchmark, where applicable.
CHAPTER 2
Interest rate benchmarks
Article 18
Interest rate benchmarks
The specific requirements laid down in Annex I shall apply to the provision of, and contribution to, interest rate
benchmarks in addition to, or as a substitute for, the requirements of Title II.
Articles 24, 25 and 26 shall not apply to the provision of, and contribution to, interest rate benchmarks.
CHAPTER 3
Commodity benchmarks
Article 19
Commodity benchmarks
1. The specific requirements laid down in Annex II shall apply instead of the requirements of Title II, with the
exception of Article 10, to the provision of, and contribution to, commodity benchmarks, unless the benchmark in
question is a regulated-data benchmark or is based on submissions by contributors the majority of which are supervised
entities.
Articles 24, 25 and 26 shall not apply to the provision of, and contribution to, commodity benchmarks.
2. Where a commodity benchmark is a critical benchmark and the underlying asset is gold, silver or platinum, the
requirements of Title II shall apply instead of Annex II.
CHAPTER 4
Critical benchmarks
Article 20
Critical benchmarks
1. The Commission shall adopt implementing acts in accordance with the examination procedure referred to in
Article 50(2) to establish and review at least every two years a list of benchmarks provided by administrators located
within the Union which are critical benchmarks, provided that one of the following conditions is fulfilled:
(a) the benchmark is used directly or indirectly within a combination of benchmarks as a reference for financial
instruments or financial contracts or for measuring the performance of investment funds, having a total value of at
least EUR 500 billion on the basis of all the range of maturities or tenors of the benchmark, where applicable;
(b) the benchmark is based on submissions by contributors the majority of which are located in one Member State and
is recognised as being critical in that Member State in accordance with the procedure laid down in paragraphs 2, 3,
4 and 5 of this Article;
(c) the benchmark fulfils all of the following criteria:
(i) the benchmark is used directly or indirectly within a combination of benchmarks as a reference for financial
instruments or financial contracts or for measuring the performance of investment funds having a total value of
at least EUR 400 billion on the basis of all the range of maturities or tenors of the benchmark, where
applicable, but not exceeding the value provided for in point (a);
(ii) the benchmark has no, or very few, appropriate market-led substitutes;
(iii) in the event that the benchmark ceases to be provided, or is provided on the basis of input data no longer fully
representative of the underlying market or economic reality or on the basis of unreliable input data, there would
be significant and adverse impacts on market integrity, financial stability, consumers, the real economy, or the
financing of households and businesses in one or more Member States.
If a benchmark meets the criteria set out in point (c)(ii) and (iii) but does not meet the criterion set out in point (c)(i),
the competent authorities of the Member States concerned together with the competent authority of the Member
State where the administrator is established may agree that such benchmark should be recognised as critical under
this subparagraph. In any case, the competent authority of the administrator shall consult the competent authorities
of the Member States concerned. In the event of disagreement between the competent authorities, the competent
authority of the administrator shall decide whether the benchmark should be recognised as critical under this
subparagraph, taking into account the reasons for the disagreement. The competent authorities or, in the event of
disagreement, the competent authority of the administrator, shall transmit the assessment to the Commission. After
receiving the assessment, the Commission shall adopt an implementing act in accordance with this paragraph. In
addition, in the event of disagreement, the competent authority of the administrator shall transmit its assessment to
ESMA, which may publish an opinion.
2. Where the competent authority of a Member State referred to in point (b) of paragraph 1 considers that an
administrator under its supervision provides a benchmark that should be recognised as critical, it shall notify ESMA and
transmit to ESMA a documented assessment.
3. For the purposes of paragraph 2, the competent authority shall assess whether the cessation of the benchmark or
its provision on the basis of input data or of a panel of contributors no longer representative of the underlying market
or economic reality would have an adverse impact on market integrity, financial stability, consumers, the real economy,
or the financing of households and businesses in its Member State. The competent authority shall take into consideration
in its assessment:
(a) the value of financial instruments and financial contracts that reference the benchmark and the value of investment
funds referencing the benchmark for measuring their performance within the Member State and their relevance in
terms of the total value of financial instruments and of financial contracts outstanding, and of the total value of
investment funds, in the Member State;
(b) the value of financial instruments and financial contracts that reference the benchmark and the value of investment
funds referencing the benchmark for measuring their performance within the Member State and their relevance in
terms of the gross national product of the Member State;
(c) any other figure to assess on objective grounds the potential impact of the discontinuity or unreliability of the
benchmark on market integrity, financial stability, consumers, the real economy, or the financing of households and
businesses in the Member State.
The competent authority shall review its assessment of the criticality of the benchmark at least every two years, and
shall notify and transmit the new assessment to ESMA.
4. Within six weeks of receipt of the notification referred to in paragraph 2, ESMA shall issue an opinion on whether
the assessment of the competent authority complies with the requirements of paragraph 3 and shall transmit such
opinion to the Commission, together with the competent authority's assessment.
5. The Commission, after receiving the opinion referred to in paragraph 4, shall adopt implementing acts in
accordance with paragraph 1.
6. The Commission shall be empowered to adopt delegated acts in accordance with Article 49 in order to:
(a) specify how the nominal amount of financial instruments other than derivatives, the notional amount of derivatives
and the net asset value of investment funds are to be assessed, including in the event of an indirect reference to a
benchmark within a combination of benchmarks, in order to be compared with the thresholds referred to in
paragraph 1 of this Article and in point (a) of Article 24(1);
(b) review the calculation method used to determine the thresholds referred to in paragraph 1 of this Article in the light
of market, price and regulatory developments as well as the appropriateness of the classification of benchmarks with
a total value of financial instruments, financial contracts, or investment funds referencing them that is close to the
thresholds; such review shall take place at least every two years as from 1 January 2018;
(c) specify how the criteria referred to in point (c)(iii) of paragraph 1 of this Article are to be applied, taking into con
sideration any data which helps assess on objective grounds the potential impact of the discontinuity or unreliability
of the benchmark on market integrity, financial stability, consumers, the real economy, or the financing of
households and businesses in one or more Member States.
Where applicable, the Commission shall take into account relevant market or technological developments.
Article 21
Mandatory administration of a critical benchmark
1. If an administrator of a critical benchmark intends to cease providing such benchmark, the administrator shall:
(a) immediately notify its competent authority; and
(b) within four weeks of such notification submit an assessment of how the benchmark:
(i) is to be transitioned to a new administrator; or
(ii) is to be ceased to be provided, taking into account the procedure established in Article 28(1).
During the period referred to in point (b) of the first subparagraph, the administrator shall not cease provision of the
benchmark.
2. Upon receipt of the assessment of the administrator referred to in paragraph 1, the competent authority shall:
(a) inform ESMA and, where applicable, the college established under Article 46; and
(b) within four weeks, make its own assessment of how the benchmark is to be transitioned to a new administrator or
be ceased to be provided, taking into account the procedure established in accordance with Article 28(1).
During the period of time referred to in point (b) of the first subparagraph of this paragraph, the administrator shall not
cease the provision of the benchmark without the written consent of the competent authority.
3. Following completion of the assessment referred to in point (b) of paragraph 2, the competent authority shall have
the power to compel the administrator to continue publishing the benchmark until such time as:
(a) the provision of the benchmark has been transitioned to a new administrator;
(b) the benchmark can be ceased to be provided in an orderly fashion; or
(c) the benchmark is no longer critical.
For the purposes of the first subparagraph, the period for which the competent authority may compel the administrator
to continue to publish the benchmark shall not exceed 12 months.
By the end of that period, the competent authority shall review its decision to compel the administrator to continue to
publish the benchmark and may, where necessary, extend the time period by an appropriate period not exceeding a
further 12 months. The maximum period of mandatory administration shall not exceed 24 months in total.
4. Without prejudice to paragraph 1, in the event that the administrator of a critical benchmark is to be wound down
due to insolvency proceedings, the competent authority shall make an assessment of whether and how the critical
benchmark can be transitioned to a new administrator or can cease to be provided in an orderly fashion, taking into
account the procedure established in accordance with Article 28(1).
Article 22
Mitigation of market power of critical benchmark administrators
Without prejudice to the application of Union competition law, when providing a critical benchmark, the administrator
shall take adequate steps to ensure that licences of, and information relating to, the benchmark are provided to all users
on a fair, reasonable, transparent and non-discriminatory basis.
Article 23
Mandatory contribution to a critical benchmark
1. This Article shall apply to critical benchmarks based on submissions by contributors the majority of which are
supervised entities.
2. Administrators of one or more critical benchmarks shall, every two years, submit to their competent authority an
assessment of the capability of each critical benchmark they provide to measure the underlying market or economic
reality.
3. If a supervised contributor to a critical benchmark intends to cease contributing input data, it shall promptly
notify in writing the benchmark administrator, which shall inform without delay its competent authority. Where the
supervised contributor is located in another Member State, the competent authority of the administrator shall inform,
without delay, the competent authority of that contributor. The benchmark administrator shall submit to its competent
authority an assessment of the implications on the capability of the benchmark to measure the underlying market or
economic reality as soon as possible but no later than 14 days after the notification made by the supervised contributor.
4. Upon receipt of an assessment of the benchmark administrator referred to in paragraphs 2 and 3 of this Article
and on the basis of such assessment, the competent authority of the administrator shall promptly inform ESMA and,
where applicable, the college established under Article 46, and make its own assessment on the capability of the
benchmark to measure the underlying market and economic reality, taking into account the administrator's procedure
for cessation of the benchmark established in accordance with Article 28(1).
5. From the date on which the competent authority of the administrator is notified of the intention of a contributor
to cease contributing input data and until such time as the assessment referred to in paragraph 4 is complete, it shall
have the power to require the contributors which made the notification in accordance with paragraph 3 to continue
contributing input data, in any event for a period of no more than four weeks, without imposing an obligation on
supervised entities to either trade or commit to trade.
6. In the event that the competent authority, after the period specified in paragraph 5 and on the basis of its own
assessment referred to in paragraph 4, considers that the representativeness of a critical benchmark is put at risk, it shall
have the power to:
(a) require supervised entities selected in accordance with paragraph 7 of this Article, including entities that are not yet
contributors to the relevant critical benchmark, to contribute input data to the administrator in accordance with the
administrator's methodology, the code of conduct referred to in Article 15 and other rules. Such requirement shall
be in place for an appropriate period of time not exceeding 12 months from the date on which the initial decision
requiring mandatory contribution was taken pursuant to paragraph 5 or, for those entities that are not yet
contributors, from the date on which the decision requiring mandatory contribution is taken under this point;
(b) extend the period of mandatory contribution by an appropriate period of time not exceeding 12 months, following
a review under paragraph 9 of any measures adopted pursuant to point (a) of this paragraph;
(c) determine the form in which, and the time by which, any input data is to be contributed without imposing an
obligation on supervised entities to either trade or commit to trade;
(d) require the administrator to change the methodology, the code of conduct referred to in Article 15 or other rules of
the critical benchmark.
The maximum period of mandatory contribution under points (a) and (b) of the first subparagraph shall not exceed 24
months in total.
7. For the purposes of paragraph 6, supervised entities that are to be required to contribute input data shall be
selected by the competent authority of the administrator, with the close cooperation of the competent authorities of the
supervised entities, on the basis of the size of the supervised entity's actual and potential participation in the market that
the benchmark intends to measure.
8. The competent authority of a supervised contributor that has been required to contribute to a benchmark through
measures taken in accordance with point (a), (b) or (c) of paragraph 6 shall cooperate with the competent authority of
the administrator in the enforcement of such measures.
9. By the end of the period referred to in point (a) of the first subparagraph of paragraph 6, the competent authority
of the administrator shall review the measures adopted under paragraph 6. It shall revoke any of them if it considers
that:
(a) the contributors are likely to continue contributing input data for at least one year if the measure were revoked,
which shall be evidenced by at least:
(i) a written commitment by the contributors to the administrator and the competent authority to continue
contributing input data to the critical benchmark for at least one year if the measure were revoked;
(ii) a written report by the administrator to the competent authority providing evidence for its assessment that the
critical benchmark's continued viability can be assured once mandatory contribution has been revoked;
(b) the provision of the benchmark is able to continue once the contributors mandated to contribute input data have
ceased contributing;
(c) an acceptable substitute benchmark is available and users of the critical benchmark can switch to this substitute at
minimal costs which shall be evidenced by at least a written report by the administrator detailing the means of
transition to a substitute benchmark and the ability and costs to users of transitioning to this benchmark; or
(d) no appropriate alternative contributors can be identified and the cessation of contributions from the relevant
supervised entities would weaken the benchmark to such an extent to require the cessation of the benchmark.
10. In the event that a critical benchmark is to be ceased to be provided, each supervised contributor to that
benchmark shall continue to contribute input data for a period of time determined by the competent authority, but not
exceeding the maximum 24-month period laid down in the second subparagraph of paragraph 6.
11. The administrator shall notify the relevant competent authority in the event that any contributors breach the
requirements set out in paragraph 6 as soon as reasonably possible.
12. In the event that a benchmark is recognised as critical in accordance with the procedure laid down in Article 20
(2), (3), (4) and (5), the competent authority of the administrator shall have the power to require input data in
accordance with paragraph 5, and points (a), (b) and (c) of paragraph 6, of this Article only from supervised
contributors located in its Member State.
CHAPTER 5
Significant benchmarks
Article 24
Significant benchmarks
1. A benchmark which does not fulfil any of the conditions laid down in Article 20(1) is significant when:
(a) it is used directly or indirectly within a combination of benchmarks as a reference for financial instruments or
financial contracts or for measuring the performance of investments funds having a total average value of at least
EUR 50 billion on the basis of all the range of maturities or tenors of the benchmark, where applicable, over a
period of six months; or
(b) it has no or very few appropriate market-led substitutes and, in the event that the benchmark ceases to be provided
or is provided on the basis of input data no longer fully representative of the underlying market or economic reality
or unreliable input data, there would be a significant and adverse impact on market integrity, financial stability,
consumers, the real economy or the financing of households or businesses in one or more Member States.
2. The Commission shall be empowered to adopt delegated acts in accordance with Article 49 in order to review the
calculation method used to determine the threshold referred to in point (a) of paragraph 1 of this Article in the light of
market, price and regulatory developments as well as the appropriateness of the classification of benchmarks with a
total value of financial instruments, financial contracts or investment funds referencing them that is close to that
threshold. Such review shall take place at least every two years as from 1 January 2018.
3. An administrator shall immediately notify its competent authority when its significant benchmark falls below the
threshold mentioned in point (a) of paragraph 1.
Article 25
Exemptions from specific requirements for significant benchmarks
1. An administrator may choose not to apply Article 4(2), points (c), (d) and (e) of Article 4(7), point (b) of
Article 11(3) or Article 15(2) with respect to its significant benchmark where that administrator considers that the
application of one or more of those provisions would be disproportionate taking into account the nature or impact of
the benchmark or the size of the administrator.
2. In the event that an administrator chooses not to apply one or more of the provisions referred to in paragraph 1,
it shall immediately notify the competent authority and provide it with all relevant information confirming the adminis
trator's assessment that the application of one or more of those provisions would be disproportionate taking into
account the nature or impact of the benchmarks or the size of the administrator.
3. A competent authority may decide that the administrator of a significant benchmark is nevertheless to apply one
or more of the requirements laid down in Article 4(2), points (c), (d) and (e) of Article 4(7), point (b) of Article 11(3)
and Article 15(2) if it considers that it would be appropriate taking into account the nature or the impact of the
benchmarks or the size of the administrator. In its assessment, the competent authority shall, based on the information
provided by the administrator, take into account the following criteria:
(a) the vulnerability of the benchmark to manipulation;
(b) the nature of the input data;
(c) the level of conflicts of interest;
(d) the degree of discretion of the administrator;

(e) the impact of the benchmark on markets;
(f) the nature, scale and complexity of the provision of the benchmark;
(g) the importance of the benchmark to financial stability;
(h) the value of financial instruments, financial contracts or investment funds that reference the benchmark;
(i) the administrator's size, organisational form or structure.
4. Within 30 days of receipt of a notification from an administrator under paragraph 2, the competent authority
shall notify that administrator of its decision to apply an additional requirement pursuant to paragraph 3. In the event
that the notification to the competent authority is made during the course of an authorisation or registration procedure,
the deadlines set out in Article 34 shall apply.
5. When exercising its supervisory powers in accordance with Article 41, a competent authority shall regularly
review whether its assessment pursuant to paragraph 3 of this Article is still valid.
6. If a competent authority finds, on reasonable grounds, that the information submitted to it pursuant to
paragraph 2 of this Article is incomplete or that supplementary information is needed, the 30-day time limit referred to
in paragraph 4 of this Article shall apply only from the date on which such complementary information is provided by
the administrator, unless the deadlines of Article 34 apply pursuant to paragraph 4 of this Article.
7. Where an administrator of a significant benchmark does not comply with one or more of the requirements laid
down in Article 4(2), points (c), (d) and (e) of Article 4(7), point (b) of Article 11(3) and Article 15(2), it shall publish
and maintain a compliance statement that clearly states why it is appropriate for that administrator not to comply with
those provisions.
8. ESMA shall develop draft implementing technical standards to develop a template for the compliance statement
referred to in paragraph 7.
ESMA shall submit the draft implementing technical standards referred to in the first subparagraph to the Commission
by 1 April 2017.
Power is conferred to the Commission to adopt the implementing technical standards referred to in the first
subparagraph in accordance with Article 15 of Regulation (EU) No 1095/2010.
9. ESMA shall develop draft regulatory technical standards to specify further the criteria referred to in paragraph 3.
accordance with procedure laid down in Articles 10 to 14 of Regulation (EU) No 1095/2010.
CHAPTER 6
Non-significant benchmarks
Article 26
Non-significant benchmarks
1. An administrator may choose not to apply Articles 4(2), points (c), (d) and (e) of Article 4(7), Articles 4(8), 5(2),
5(3), 5(4), 6(1), 6(3), 6(5), 7(2), point (b) of Article 11(1), points (b) and (c) of Article 11(2), and Articles 11(3), 13(2),
14(2), 15(2), 16(2) and (3) with respect to its non-significant benchmarks.
2. An administrator shall immediately notify its competent authority when the administrator's non-significant
benchmark exceeds the threshold mentioned in point (a) of Article 24(1). In that case, it shall comply with the
requirements applicable to significant benchmarks within three months.
3. Where an administrator of a non-significant benchmark chooses not to apply one or more of the provisions
referred to in paragraph 1, it shall publish and maintain a compliance statement which shall clearly state why it is
appropriate for that administrator not to comply with those provisions. The administrator shall provide the compliance
statement to its competent authority.
4. The relevant competent authority shall review the compliance statement referred to in paragraph 3 of this Article.
The competent authority may also request additional information from the administrator in respect of its non-significant
benchmarks in accordance with Article 41 and may require changes to ensure compliance with this Regulation.
5. ESMA shall develop draft implementing technical standards to develop a template for the compliance statement
referred to in paragraph 3.
by 1 April 2017.
TITLE IV
TRANSPARENCY AND CONSUMER PROTECTION
Article 27
Benchmark statement
1. Within two weeks of the inclusion of an administrator in the register referred to in Article 36, the administrator
shall publish, by means that ensure fair and easy access, a benchmark statement for each benchmark or, where
applicable, for each family of benchmarks, that may be used in the Union in accordance with Article 29.
Where that administrator begins providing a new benchmark or family of benchmarks that may be used in the Union in
accordance with Article 29, the administrator shall publish, within two weeks and by means that ensure a fair and easy
access, a benchmark statement for each new benchmark or, where applicable, family of benchmarks.
The administrator shall review and, where necessary, update the benchmark statement for each benchmark or family of
benchmarks in the event of any changes to the information to be provided under this Article and at least every two
years.
The benchmark statement shall:
(a) clearly and unambiguously define the market or economic reality measured by the benchmark and the circumstances
in which such measurement may become unreliable;
(b) lay down technical specifications that clearly and unambiguously identify the elements of the calculation of the
benchmark in relation to which discretion may be exercised, the criteria applicable to the exercise of such discretion
and the position of the persons that can exercise discretion, and how such discretion may be subsequently evaluated;
(c) provide notice of the possibility that factors, including external factors beyond the control of the administrator, may
necessitate changes to, or the cessation of, the benchmark; and
(d) advise users that changes to, or the cessation of, the benchmark may have an impact upon the financial contracts
and financial instruments that reference the benchmark or the measurement of the performance of investment
funds.
2. A benchmark statement shall contain at least:
(a) the definitions for all key terms relating to the benchmark;
(b) the rationale for adopting the benchmark methodology and procedures for the review and approval of the
methodology;
(c) the criteria and procedures used to determine the benchmark, including a description of the input data, the priority
given to different types of input data, the minimum data needed to determine a benchmark, the use of any models
or methods of extrapolation and any procedure for rebalancing the constituents of a benchmark's index;
(d) the controls and rules that govern any exercise of judgement or discretion by the administrator or any contributors,
to ensure consistency in the use of such judgement or discretion;
(e) the procedures which govern the determination of the benchmark in periods of stress or periods where transaction
data sources may be insufficient, inaccurate or unreliable and the potential limitations of the benchmark in such
periods;
(f) the procedures for dealing with errors in input data or in the determination of the benchmark, including when a re-
determination of the benchmark is required; and
(g) the identification of potential limitations of the benchmark, including its operation in illiquid or fragmented markets
and the possible concentration of inputs.
3. ESMA shall develop draft regulatory technical standards to specify further the contents of a benchmark statement
and the cases in which an update of such statement is required.
ESMA shall distinguish between the different types of benchmarks and sectors as set out in this Regulation and shall
take into account the principle of proportionality.
Article 28
Changes to and cessation of a benchmark
1. An administrator shall publish, together with the benchmark statement referred to in Article 27, a procedure
concerning the actions to be taken by the administrator in the event of changes to or the cessation of a benchmark
which may be used in the Union in accordance with Article 29(1). The procedure may be drafted, where applicable, for
families of benchmarks and shall be updated and published whenever a material change occurs.
2. Supervised entities other than an administrator as referred to in paragraph 1 that use a benchmark shall produce
and maintain robust written plans setting out the actions that they would take in the event that a benchmark materially
changes or ceases to be provided. Where feasible and appropriate, such plans shall nominate one or several alternative
benchmarks that could be referenced to substitute the benchmarks no longer provided, indicating why such benchmarks
would be suitable alternatives. The supervised entities shall, upon request, provide the relevant competent authority with
those plans and any updates and shall reflect them in the contractual relationship with clients.
TITLE V
USE OF BENCHMARKS IN THE UNION
Article 29
Use of a benchmark
1. A supervised entity may use a benchmark or a combination of benchmarks in the Union if the benchmark is
provided by an administrator located in the Union and included in the register referred to in Article 36 or is a
benchmark which is included in the register referred to in Article 36.
2. Where the object of a prospectus to be published under Directive 2003/71/EC or Directive 2009/65/EC is
transferable securities or other investment products that reference a benchmark, the issuer, offeror, or person asking for
admission to trade on a regulated market shall ensure that the prospectus also includes clear and prominent information
stating whether the benchmark is provided by an administrator included in the register referred to in Article 36 of this
Regulation.
Article 30
Equivalence
1. In order for a benchmark or a combination of benchmarks provided by an administrator located in a third country
to be used in the Union in accordance with Article 29(1), the benchmark and the administrator shall be included in the
register referred to in Article 36. The following conditions shall be complied with in order to be included in the register:
(a) an equivalence decision is adopted by the Commission in accordance with paragraph 2 or 3 of this Article;
(b) the administrator is authorised or registered, and is subject to supervision, in the third country in question;
(c) ESMA is notified by the administrator of its consent that its actual or prospective benchmarks may be used by
supervised entities in the Union, of the list of the benchmarks for which they have given consent to be used in the
Union and of the competent authority responsible for its supervision in the third country; and
(d) the cooperation arrangements referred to in paragraph 4 of this Article are operational.
2. The Commission may adopt an implementing decision stating that the legal framework and supervisory practice of
a third country ensures that:
(a) administrators authorised or registered in that third country comply with binding requirements which are equivalent
to the requirements under this Regulation, in particular taking account of whether the legal framework and
supervisory practice of a third country ensures compliance with the IOSCO principles for financial benchmarks or,
where applicable, with the IOSCO principles for PRAs; and
(b) the binding requirements are subject to effective supervision and enforcement on an on-going basis in that third
country.
Such implementing decision shall be adopted in accordance with the examination procedure referred to in Article 50(2).
3. Alternatively, the Commission may adopt an implementing decision stating that:
(a) binding requirements in a third country with respect to specific administrators or specific benchmarks or families of
benchmarks are equivalent to the requirements under this Regulation, in particular taking account of whether the
legal framework and supervisory practice of a third country ensures compliance with the IOSCO principles for
financial benchmarks or, where applicable, with the IOSCO principles for PRAs; and
(b) such specific administrators or specific benchmarks or families of benchmarks are subject to effective supervision
and enforcement on an on-going basis in that third country.
Such implementing decision shall be adopted in accordance with the examination procedure referred to in Article 50(2).
4. ESMA shall establish cooperation arrangements with the competent authorities of third countries whose legal
framework and supervisory practices have been recognised as equivalent in accordance with paragraph 2 or 3. Such
arrangements shall specify at least:
(a) the mechanism for the exchange of information between ESMA and the competent authorities of third countries
concerned, including access to all relevant information regarding the administrator authorised in that third country
that is requested by ESMA;
(b) the mechanism for prompt notification to ESMA where a third country competent authority deems that the adminis
trator authorised in that third country that it is supervising is in breach of the conditions of its authorisation or
other national legislation in the third country;
(c) the procedures concerning the coordination of supervisory activities, including on-site inspections.
5. ESMA shall develop draft regulatory technical standards to determine the minimum content of the cooperation
arrangements referred to in paragraph 4 so as to ensure that the competent authorities and ESMA are able to exercise all
their supervisory powers under this Regulation.
Article 31
Withdrawal of registration of an administrator located in a third country
1. ESMA shall withdraw the registration of an administrator located in a third country by removing that administrator
from the register referred to in Article 36 where it has well-founded reasons, based on documented evidence, that the
administrator:
(a) is acting in a manner which is clearly prejudicial to the interests of the users of its benchmarks or the orderly
functioning of markets; or
(b) has seriously infringed the national legislation in the third country or other provisions applicable to it in the third
country and on the basis of which the Commission has adopted the implementing decision in accordance with
Article 30(2) or (3).
2. ESMA shall take a decision under paragraph 1 only if the following conditions are fulfilled:
(a) ESMA has referred the matter to the competent authority of the third country and that competent authority has not
taken the appropriate measures needed to protect investors and the orderly functioning of the markets in the Union,
or has failed to demonstrate that the administrator concerned complies with the requirements applicable to it in the
third country;
(b) ESMA has informed the competent authority of the third country of its intention to withdraw the registration of the
administrator, at least 30 days before the withdrawal.
3. ESMA shall inform the other competent authorities of any measure adopted in accordance with paragraph 1
without delay and shall publish its decision on its website.
Article 32
Recognition of an administrator located in a third country
1. Until such time as an equivalence decision in accordance with Article 30(2) or (3) is adopted, a benchmark
provided by an administrator located in a third country may be used by supervised entities in the Union provided that
the administrator acquires prior recognition by the competent authority of its Member State of reference in accordance
with this Article.
2. An administrator located in a third country intending to obtain prior recognition as referred to in paragraph 1 of
this Article shall comply with the requirements established in this Regulation, excluding Article 11(4) and Articles 16,
20, 21 and 23. The administrator may fulfil that condition by applying the IOSCO principles for financial benchmarks
or the IOSCO principles for PRAs, as applicable, provided that such application is equivalent to compliance with the
requirements established in this Regulation, excluding Article 11(4), and Articles 16, 20, 21 and 23.
For the purposes of determining whether the condition referred to in the first subparagraph is fulfilled, and in order to
assess compliance with the IOSCO principles for financial benchmarks or the IOSCO principles for PRAs, as applicable,
the competent authority of the Member State of reference may rely on an assessment by an independent external auditor
or, where the administrator located in a third country is subject to supervision, on the certification provided by the
competent authority of the third country where the administrator is located.
If, and to the extent that, an administrator is able to demonstrate that a benchmark it provides is a regulated-data
benchmark or a commodity benchmark that is not based on submissions by contributors the majority of which are
supervised entities, there shall be no obligation on the administrator to comply with requirements not applicable to the
provision of regulated-data benchmarks and of commodity benchmarks as provided for in Article 17 and Article 19(1)
respectively.
3. An administrator located in a third country intending to obtain prior recognition as referred to in paragraph 1
shall have a legal representative established in its Member State of reference. The legal representative shall be a natural or
legal person located in the Union, and which, expressly appointed by the administrator located in a third country, acts
on behalf of such administrator vis-à-vis the authorities and any other person in the Union with regard to the adminis
trator's obligations under this Regulation. The legal representative shall perform the oversight function relating to the
provision of benchmarks performed by the administrator under this Regulation together with the administrator and, in
that respect, shall be accountable to the competent authority of the Member State of reference.
4. The Member State of reference of an administrator located in a third country shall be determined as follows:
(a) where an administrator is part of a group that contains one supervised entity located in the Union, the Member
State of reference shall be the Member State where that supervised entity is located. Such supervised entity shall be
appointed as the legal representative for the purposes of paragraph 3;
(b) if point (a) does not apply, where an administrator is part of a group that contains more than one supervised entity
located in the Union, the Member State of reference shall be the Member State where the highest number of
supervised entities are located or, in the event that there is an equal number of supervised entities, the Member State
of reference shall be the one where the value of financial instruments, financial contracts or investment funds that
reference the benchmark is highest. One of the supervised entities located in the Member State of reference
determined pursuant to this point shall be appointed as the legal representative for the purposes of paragraph 3;
(c) if neither point (a) nor (b) of this paragraph applies, where one or more benchmarks provided by the administrator
are used as a reference for financial instruments admitted to trading in a trading venue as defined in point (24) of
Article 4(1) of Directive 2014/65/EU in one or more Member States, the Member State of reference shall be the
Member State where the financial instrument referencing any of those benchmarks was admitted to trading or traded
on a trading venue for the first time and is still traded. If the relevant financial instruments were admitted to trading
or traded for the first time simultaneously on trading venues in different Member States, and are still traded, the
Member State of reference shall be the one where the value of financial instruments, financial contracts or
investment funds that reference the benchmark is highest;
(d) if points (a), (b) and (c) do not apply, where one or more benchmarks provided by the administrator are used by
supervised entities in more than one Member State, the Member State of reference shall be the Member State where
the highest number of such supervised entities are located or, in the event that there is an equal number of
supervised entities, the Member State of reference shall be the one where the value of financial instruments, financial
contracts or investment funds that reference the benchmark is highest;
(e) if points (a), (b), (c) and (d) do not apply and if the administrator enters into an agreement consenting to the use of a
benchmark it provides with a supervised entity, the Member State of reference shall be the Member State where such
supervised entity is located.
5. An administrator located in a third country intending to obtain prior recognition as referred to in paragraph 1
shall apply for recognition with the competent authority of its Member State of reference. The applicant administrator
shall provide all information necessary to satisfy the competent authority that it has established, at the time of
recognition, all the necessary arrangements to meet the requirements referred to in paragraph 2 and shall provide the
list of its actual or prospective benchmarks which may be used in the Union and shall, where applicable, indicate the
competent authority responsible for its supervision in the third country.
Within 90 working days of receipt of the application referred to in the first subparagraph of this paragraph, the
competent authority shall verify that the conditions laid down in paragraphs 2, 3 and 4 are fulfilled.
If the competent authority considers that the conditions laid down in paragraphs 2, 3 and 4 are not fulfilled, it shall
refuse the recognition request and set out the reasons for that refusal. In addition, no recognition shall be granted unless
the following additional conditions are fulfilled:
(a) where an administrator located in a third country is subject to supervision, an appropriate cooperation arrangement
is in place between the competent authority of the Member State of reference and the competent authority of the
third country where the administrator is located, in compliance with the regulatory technical standards adopted
pursuant to Article 30(5), in order to ensure an efficient exchange of information that allows the competent
authority to carry out its duties in accordance with this Regulation;
(b) the effective exercise by the competent authority of its supervisory functions under this Regulation is neither
prevented by the laws, regulations or administrative provisions of the third country where the administrator is
located, nor, where applicable, by limitations in the supervisory and investigatory powers of that third country's
supervisory authority.
6. In the event that the competent authority of the Member State of reference considers that an administrator located
in a third country provides a benchmark that fulfils the conditions of a significant or non-significant benchmark, as
provided for in Articles 24 and 26 respectively, it shall, without undue delay, notify ESMA thereof. It shall support such
assessment with the information provided by the administrator in the relevant application for recognition.
Within one month of receipt of the notification referred to in the first subparagraph, ESMA shall issue advice to the
competent authority about the type of the benchmark and the requirements applicable to its provision, as provided for
in Articles 24, 25 and 26. The advice may, in particular, address whether ESMA considers that the conditions for such
type are fulfilled on the basis of the information provided by the administrator in the application for recognition.
The period of time referred to in paragraph 5 shall be suspended from the date on which the notification is received by
ESMA, until such time as ESMA issues advice in accordance with this paragraph.
If the competent authority of the Member State of reference proposes to grant recognition contrary to ESMA's advice
referred to in the second subparagraph, it shall inform ESMA thereof, stating its reasons. ESMA shall publish the fact
that the competent authority does not comply or intend to comply with that advice. ESMA may also decide, on a case-
by-case basis, to publish the reasons provided by the competent authority for not complying with that advice. The
competent authority concerned shall receive advance notice of such publication.
7. The competent authority of the Member State of reference shall notify ESMA of any decision to recognise an
administrator located in a third country within five working days, along with the list of the benchmarks provided by the
administrator which may be used in the Union and, where applicable, the competent authority responsible for its
supervision in the third country.
8. The competent authority of the Member State of reference shall suspend or, where appropriate, withdraw the
recognition granted in accordance with paragraph 5 if it has well-founded reasons, based on documented evidence, to
consider that the administrator is acting in a manner which is clearly prejudicial to the interests of users of its
benchmarks or the orderly functioning of markets or the administrator has seriously infringed the relevant requirements
set out in this Regulation, or that the administrator made false statements or used any other irregular means to obtain
the recognition.
9. ESMA may develop draft regulatory technical standards to determine the form and content of the application
referred to in paragraph 5 and, in particular, the presentation of the information required in paragraph 6.
In the event that such draft regulatory technical standards are developed, ESMA shall submit them to the Commission.
Power is conferred on the Commission to adopt the regulatory technical standards referred to in the first subparagraph
in accordance with the procedure laid down in Articles 10 to 14 of Regulation (EU) No 1095/2010.
Article 33
Endorsement of benchmarks provided in a third country
1. An administrator located in the Union and authorised or registered in accordance with Article 34, or any other
supervised entity located in the Union with a clear and well-defined role within the control or accountability framework
of a third country administrator, which is able to monitor effectively the provision of a benchmark, may apply to the
relevant competent authority to endorse a benchmark or a family of benchmarks provided in a third country for their
use in the Union, provided that all of the following conditions are fulfilled:
(a) the endorsing administrator or other supervised entity has verified and is able to demonstrate on an on-going basis
to its competent authority that the provision of the benchmark or family of benchmarks to be endorsed fulfils, on a
mandatory or on a voluntary basis, requirements which are at least as stringent as the requirements of this
Regulation;
(b) the endorsing administrator or other supervised entity has the necessary expertise to monitor effectively the activity
of the provision of a benchmark in a third country and to manage the associated risks;
(c) there is an objective reason to provide the benchmark or family of benchmarks in a third country and for said
benchmark or family of benchmarks to be endorsed for their use in the Union.
For the purpose of point (a), when assessing whether the provision of the benchmark or family of benchmarks to be
endorsed fulfils requirements which are at least as stringent as the requirements of this Regulation, the competent
authority may take into account whether the compliance of the provision of the benchmark or family of benchmarks
with the IOSCO principles for financial benchmarks or the IOSCO principles for PRAs, as applicable, would be
equivalent to compliance with the requirements of this Regulation.
2. An administrator or other supervised entity that makes an application for endorsement as referred to in
paragraph 1 shall provide all information necessary to satisfy the competent authority that, at the time of application, all
the conditions referred to in that paragraph are fulfilled.
3. Within 90 working days of receipt of the application for endorsement referred to in paragraph 1, the relevant
competent authority shall examine the application and adopt a decision either to authorise the endorsement or to refuse
it. An endorsed benchmark or an endorsed family of benchmarks shall be notified by the competent authority to ESMA.
4. An endorsed benchmark or an endorsed family of benchmarks shall be considered to be a benchmark or family of

benchmarks provided by the endorsing administrator or other supervised entity. The endorsing administrator or other
supervised entity shall not use the endorsement with the intention of avoiding the requirements of this Regulation.
5. An administrator or other supervised entity that has endorsed a benchmark or a family of benchmarks provided in
a third country shall remain fully responsible for such a benchmark or family of benchmarks and for compliance with
the obligations under this Regulation.
6. Where the competent authority of the endorsing administrator or other supervised entity has well-founded reasons
to consider that the conditions laid down under paragraph 1 of this Article are no longer fulfilled, it shall have the
power to require the endorsing administrator or other supervised entity to cease the endorsement and shall inform
ESMA thereof. Article 28 shall apply in case of cessation of the endorsement.
7. The Commission shall be empowered to adopt delegated acts in accordance with Article 49 concerning measures
to determine the conditions under which the relevant competent authorities may assess whether there is an objective
reason for the provision of a benchmark or family of benchmarks in a third country and their endorsement for their use
in the Union. The Commission shall take into account elements such as the specificities of the underlying market or
economic reality the benchmark intends to measure, the need for proximity of the provision of the benchmark to such
market or economic reality, the need for proximity of the provision of the benchmark to contributors, the material
availability of input data due to different time zones, and specific skills required in the provision of the benchmark.
TITLE VI
AUTHORISATION, REGISTRATION AND SUPERVISION OF ADMINISTRATORS
CHAPTER 1
Authorisation and registration
Article 34
Authorisation and registration of an administrator
1. A natural or legal person located in the Union that intends to act as an administrator shall apply to the competent
authority designated under Article 40 of the Member State in which that person is located in order to receive:
(a) authorisation if it provides or intends to provide indices which are used or intended to be used as benchmarks
within the meaning of this Regulation;
(b) registration if it is a supervised entity, other than an administrator, that provides or intends to provide indices which
are used or intended to be used as benchmarks within the meaning of this Regulation, on condition that the activity
of provision of a benchmark is not prevented by the sectoral discipline applying to the supervised entity and that
none of the indices provided would qualify as a critical benchmark; or
(c) registration if it provides or intends to provide only indices which would qualify as non-significant benchmarks.
2. An authorised or registered administrator shall comply at all times with the conditions laid down in this
Regulation and shall notify the competent authority of any material changes thereof.
3. The application referred to in paragraph 1 shall be made within 30 working days of any agreement entered into by
a supervised entity to use an index provided by the applicant as a reference to a financial instrument or financial
contract or to measure the performance of an investment fund.
4. The applicant shall provide all information necessary to satisfy the competent authority that the applicant has
established, at the time of authorisation or registration, all the necessary arrangements to meet the requirements laid
down in this Regulation.
5. Within 15 working days of receipt of the application, the relevant competent authority shall assess whether the
application is complete and shall notify the applicant accordingly. If the application is incomplete, the applicant shall
submit the additional information required by the relevant competent authority. The time limit referred to in this
paragraph shall apply from the date on which such additional information is provided by the applicant.
6. The relevant competent authority shall:
(a) examine the application for authorisation and adopt a decision to authorise or refuse to authorise the applicant
within four months of receipt of a complete application;
(b) examine the application for registration and adopt a decision to register or refuse to register the applicant within 45
working days of receipt of a complete application.
Within five working days of the adoption of a decision referred to in the first subparagraph, the competent authority
shall notify it to the applicant. Where the competent authority refuses to authorise or to register the applicant, it shall
give reasons for its decision.
7. The competent authority shall notify ESMA of any decision to authorise or to register an applicant within five
working days of the date of adoption of said decision.
8. ESMA shall develop draft regulatory technical standards to specify further the information to be provided in the
application for authorisation and in the application for registration, taking into account that authorisation and
registration are distinct processes where authorisation requires a more extensive assessment of the administrator's
application, the principle of proportionality, the nature of the supervised entities applying for registration under
point (b) of paragraph 1 and the costs to the applicants and competent authorities.
Article 35
Withdrawal or suspension of authorisation or registration
1. A competent authority may withdraw or suspend the authorisation or registration of an administrator where the
administrator:
(a) expressly renounces the authorisation or registration or has provided no benchmarks for the preceding 12 months;
(b) has obtained the authorisation or registration, or has endorsed a benchmark, by making false statements or by any
other irregular means;
(c) no longer meets the conditions under which it was authorised or registered; or
(d) has seriously or repeatedly infringed the provisions of this Regulation.
2. The competent authority shall notify ESMA of its decision within five working days of the adoption of said
decision.
ESMA shall promptly update the register provided for in Article 36.
3. Following the adoption of a decision to suspend the authorisation or registration of an administrator, and where
cessation of the benchmark would result in a force majeure event, or frustrate or otherwise breach the terms of any
financial contract or financial instrument, or the rules of any investment fund, which references that benchmark, as
specified in the delegated act adopted pursuant to Article 51(6), the provision of the benchmark in question may be
permitted by the relevant competent authority of the Member State where the administrator is located until the decision
of suspension has been withdrawn. During that period of time, the use of such benchmark by supervised entities shall
be permitted only for financial contracts, financial instruments and investment funds that already reference the
benchmark.
4. Following the adoption of a decision to withdraw the authorisation or registration of an administrator,

Article 28(2) shall apply.
Article 36
Register of administrators and benchmarks
1. ESMA shall establish and maintain a public register that contains the following information:
(a) the identities of the administrators authorised or registered pursuant to Article 34 and the competent authorities
responsible for the supervision thereof;
(b) the identities of administrators that comply with the conditions laid down in Article 30(1), the list of benchmarks
referred to in point (c) of Article 30(1) and the third country competent authorities responsible for the supervision
thereof;
(c) the identities of the administrators that acquired recognition in accordance with Article 32, the list of benchmarks
referred to in Article 32(7) and, where applicable, the third country competent authorities responsible for the
supervision thereof;
(d) the benchmarks that are endorsed in accordance with the procedure laid down in Article 33, the identities of their
administrators, and the identities of the endorsing administrators or endorsing supervised entities.
2. The register referred to in paragraph 1 shall be publicly accessible on the website of ESMA and shall be updated
promptly, as necessary.
CHAPTER 2
Supervisory cooperation
Article 37
Delegation of tasks between competent authorities
1. In accordance with Article 28 of Regulation (EU) No 1095/2010, a competent authority may delegate its tasks
under this Regulation to the competent authority of another Member State with its prior consent.
The competent authorities shall notify ESMA of any proposed delegation 60 days prior to such delegation taking effect.
2. A competent authority may delegate some of its tasks under this Regulation to ESMA, subject to the agreement of
ESMA.
3. ESMA shall notify the Member States of a proposed delegation within seven days. ESMA shall publish details of
any agreed delegation within five working days of notification.
Article 38
Disclosure of information from another Member State
A competent authority may disclose information received from another competent authority only if:
(a) it has obtained the written agreement of that competent authority and the information is disclosed only for the
purposes for which that competent authority gave its agreement; or
(b) such disclosure is necessary for legal proceedings.
Article 39
Cooperation on on-site inspections and investigations
1. A competent authority may request the assistance of another competent authority with regard to on-site
inspections or investigations. The competent authority receiving the request shall cooperate to the extent possible and
appropriate.
2. A competent authority making a request referred to in paragraph 1 shall inform ESMA thereof. In the event of an
investigation or inspection with cross-border effect, the competent authorities may request ESMA to coordinate the on-
site inspection or investigation.
3. Where a competent authority receives a request from another competent authority to carry out an on-site
inspection or an investigation, it may:
(a) carry out the on-site inspection or investigation itself;
(b) allow the competent authority which submitted the request to participate in the on-site inspection or investigation;
(c) appoint auditors or experts to support or carry out the on-site inspection or investigation.
CHAPTER 3
Role of competent authorities
Article 40
Competent authorities
1. For administrators and supervised entities, each Member State shall designate the relevant competent authority
responsible for carrying out the duties under this Regulation and shall inform the Commission and ESMA thereof.
2. Where a Member State designates more than one competent authority, it shall clearly determine their respective
roles and shall designate a single authority to be responsible for coordinating cooperation and the exchange of
information with the Commission, ESMA and other Member States' competent authorities.
3. ESMA shall publish on its website a list of the competent authorities designated in accordance with paragraphs 1
and 2.
Article 41
Powers of competent authorities
1. In order to fulfil their duties under this Regulation, competent authorities shall have, in conformity with national
law, at least the following supervisory and investigatory powers:
(a) access to any document and other data in any form, and to receive or take a copy thereof;
(b) require or demand information from any person involved in the provision of, and contribution to, a benchmark,
including any service provider to which functions, services or activities in the provision of a benchmark have been
outsourced as provided for in Article 10, as well as their principals, and if necessary, summon and question any
such person with a view to obtaining information;
(c) request, in relation to commodity benchmarks, information from contributors on related spot markets according,
where applicable, to standardised formats and reports on transactions, and direct access to traders' systems;
(d) carry out on-site inspections or investigations, at sites other than the private residences of natural persons;
(e) enter premises of legal persons, without prejudice to Regulation (EU) No 596/2014, in order to seize documents
and other data in any form, where a reasonable suspicion exists that documents and other data related to the
subject-matter of the inspection or investigation may be relevant to prove a breach of this Regulation. Where prior
authorisation is needed from the judicial authority of the Member State concerned, in accordance with national law,
such power shall only be used after having obtained that prior authorisation;
(f) require existing recordings of telephone conversations, electronic communications or other data traffic records held
by supervised entities;
(g) request the freezing or sequestration of assets or both;
(h) require temporary cessation of any practice that the competent authority considers contrary to this Regulation;
(i) impose a temporary prohibition on the exercise of professional activity;
(j) take all necessary measures to ensure that the public is correctly informed about the provision of a benchmark,
including by requiring the relevant administrator or a person that has published or disseminated the benchmark or
both to publish a corrective statement about past contributions to or figures of the benchmark.
2. Competent authorities shall exercise their functions and powers referred to in paragraph 1 of this Article and the
powers to impose sanctions referred to in Article 42, in accordance with their national legal frameworks, in any of the
following ways:
(a) directly;
(b) in collaboration with other authorities or with market undertakings;
(c) under their responsibility by delegation to such authorities or to market undertakings;
(d) by application to the competent judicial authorities.
For the exercise of those powers, competent authorities shall have in place adequate and effective safeguards in regard to
the right of defence and fundamental rights.
3. Member States shall ensure that appropriate measures are in place so that competent authorities have all the
supervisory and investigatory powers that are necessary to fulfil their duties.
4. An administrator or any other supervised entity making information available to a competent authority in
accordance with paragraph 1 shall not be considered to be in breach of any restriction on disclosure of information
posed by any contractual, legislative, regulatory or administrative provision.
Article 42
Administrative sanctions and other administrative measures
1. Without prejudice to the supervisory powers of competent authorities in accordance with Article 41, and the right
of Member States to provide for and impose criminal sanctions, Member States shall, in conformity with national law,
provide for competent authorities to have the power to impose appropriate administrative sanctions and other adminis
trative measures in relation to at least the following infringements:
(a) any infringement of Articles 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 21, 23, 24, 25, 26, 27, 28, 29 and 34
where they apply; and
(b) any failure to cooperate or comply in an investigation or with an inspection or request covered by Article 41.
Those administrative sanctions and other administrative measures shall be effective, proportionate and dissuasive.
2. In the event of an infringement referred to in paragraph 1, Member States shall, in conformity with national law,
confer on competent authorities the power to impose at least the following administrative sanctions and other adminis
trative measures:
(a) an order requiring the administrator or supervised entity responsible for the infringement to cease the conduct and
to desist from repeating that conduct;
(b) the disgorgement of the profits gained or losses avoided because of the infringement where those can be
determined;
(c) a public warning which indicates the administrator or supervised entity responsible and the nature of the
infringement;
(d) withdrawal or suspension of the authorisation or the registration of an administrator;
(e) a temporary ban prohibiting any natural person, who is held responsible for such infringement, from exercising
management functions in administrators or supervised contributors;
(f) the imposition of maximum administrative pecuniary sanctions of at least three times the amount of the profits
gained or losses avoided because of the infringement where those can be determined;
(g) in respect of a natural person, maximum administrative pecuniary sanctions of at least:
(i) for infringements of Articles 4, 5, 6, 7, 8, 9, 10, points (a), (b), (c) and (e) of Article 11(1), Article 11(2) and (3),
and Articles 12, 13,14, 15, 16, 21, 23, 24, 25, 26, 27, 28, 29 and 34, EUR 500 000 or in the Member States
whose official currency is not the euro, the corresponding value in the national currency on 30 June 2016; or
(ii) for infringements of point (d) of Article 11(1) or of Article 11(4), EUR 100 000 or in the Member States whose
official currency is not the euro, the corresponding value in the national currency on 30 June 2016;
(h) in respect of a legal person, maximum administrative pecuniary sanctions of at least:
(i) for infringements of Articles 4, 5, 6, 7, 8, 9, 10, points (a), (b), (c) and (e) of Article 11(1), Article 11(2) and (3),
and Articles 12, 13,14, 15, 16, 21, 23, 24, 25, 26, 27, 28, 29 and 34, either EUR 1 000 000 or, in the Member
States whose official currency is not the euro, the corresponding value in the national currency on 30 June
2016, or 10 % of its total annual turnover according to the last available accounts approved by the management
body, whichever is the higher; or
(ii) for infringements of point (d) of Article 11(1) or of Article 11(4), either EUR 250 000 or, in the Member States
whose official currency is not the euro, the corresponding value in the national currency on 30 June 2016, or
2 % of its total annual turnover according to the last available accounts approved by the management body,
whichever is the higher.
For the purposes of point (h)(i) and (ii), where the legal person is a parent undertaking or a subsidiary of a parent
undertaking which has to prepare consolidated financial accounts in accordance with Directive 2013/34/EU of the
European Parliament and of the Council (1), the relevant total annual turnover shall be the total annual turnover or the
corresponding type of income in accordance with Council Directive 86/635/EEC (2) for banks and Council Directive
91/674/EEC (3) for insurance companies according to the last available consolidated accounts approved by the
management body of the ultimate parent undertaking or if the person is an association, 10 % of the aggregate turnovers
of its members.
3. By 1 January 2018, Member States shall notify the rules regarding paragraphs 1 and 2 to the Commission and
ESMA.
Member States may decide not to lay down rules for administrative sanctions as provided for in paragraph 1 where the
infringements referred to in that paragraph are subject to criminal sanctions under their national law. In that case,
Member States shall communicate to the Commission and ESMA the relevant criminal law provisions along with the
notification referred to in the first subparagraph of this paragraph.
They shall notify the Commission and ESMA without delay of any subsequent amendment thereto.
4. Member States may provide competent authorities under national law to have other powers to impose sanctions in
addition to those referred to in paragraph 1 and may provide for higher levels of sanctions than those established in
paragraph 2.
(1) Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated
financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament
and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC (OJ L 182, 29.6.2013, p. 19).
(2) Council Directive 86/635/EEC of 8 December 1986 on the annual accounts and consolidated accounts of banks and other financial
institutions (OJ L 372, 31.12.1986, p. 1).
(3) Council Directive 91/674/EEC of 19 December 1991 on the annual accounts and consolidated accounts of insurance undertakings
(OJ L 374, 31.12.1991, p. 7).
Article 43
Exercise of supervisory powers and imposition of sanctions
1. Member States shall ensure that, when determining the type and level of administrative sanctions and other
administrative measures, competent authorities take into account all relevant circumstances, including where
appropriate:
(a) the gravity and duration of the infringement;
(b) the criticality of the benchmark to financial stability and the real economy;
(c) the degree of responsibility of the responsible person;
(d) the financial strength of the responsible person, as indicated, in particular, by the total annual turnover of the
responsible legal person or the annual income of the responsible natural person;
(e) the level of the profits gained or losses avoided by the responsible person, insofar as they can be determined;
(f) the level of cooperation of the responsible person with the competent authority, without prejudice to the need to
ensure disgorgement of profits gained or losses avoided by that person;
(g) previous infringements by the person concerned;
(h) measures taken, after the infringement, by a responsible person to prevent the repetition of the infringement.
2. In the exercise of their powers to impose administrative sanctions and other administrative measures under
Article 42, competent authorities shall cooperate closely to ensure that the supervisory and investigative powers and
administrative sanctions and other administrative measures produce the desired results of this Regulation. They shall
also coordinate their action in order to avoid possible duplication and overlap when applying supervisory and investi
gative powers and administrative sanctions, including pecuniary sanctions, and other administrative measures to cross-
border cases.
Article 44
Obligation to cooperate
1. Where Member States have chosen, in accordance with Article 42, to lay down criminal sanctions for infringe
ments of the provisions referred to in that Article, they shall ensure that appropriate measures are in place so that
competent authorities have all the necessary powers to liaise with judicial authorities within their jurisdiction to receive
specific information relating to criminal investigations or proceedings commenced for possible infringements of this
Regulation. Those competent authorities shall provide that information to other competent authorities and ESMA, in
order to fulfil their obligation to cooperate with each other and ESMA for the purposes of this Regulation.
2. Competent authorities shall provide assistance to competent authorities of other Member States. In particular, they
shall exchange information and cooperate in any investigation or supervisory activities. Competent authorities may also
cooperate with competent authorities of other Member States with respect to facilitating the recovery of pecuniary
sanctions.
Article 45
Publication of decisions
1. Subject to paragraph 2, a competent authority shall publish any decision imposing an administrative sanction or
other administrative measure in relation to infringements of this Regulation on its official website immediately after the
person subject to that decision has been informed of that decision. Such publication shall include at least information
on the type and nature of the infringement and the identity of the persons subject to the decision.
The first subparagraph does not apply to decisions imposing measures that are of an investigatory nature.
2. Where a competent authority considers that the publication of the identity of the legal person or of the personal
data of a natural person, would be disproportionate following a case-by-case assessment conducted on the propor
tionality of the publication of such data, or where such publication would jeopardise the stability of financial markets or
an on-going investigation, it shall do any of the following:
(a) defer publication of the decision until such time as the reasons for that deferral cease to exist;
(b) publish the decision on an anonymous basis in accordance with national law where such anonymous publication
ensures an effective protection of the personal data concerned;
(c) not publish the decision at all in the event that the competent authority is of the opinion that publication in
accordance with point (a) or (b) will be insufficient to ensure:
(i) that the stability of financial markets is not jeopardised; or
(ii) the proportionality of the publication of such decisions with regard to measures which are deemed to be of a
minor nature.
Where a competent authority decides to publish a decision on an anonymous basis as referred to in point (b) of the first
subparagraph, it may postpone the publication of the relevant data for a reasonable period of time where it is
foreseeable that the reasons for anonymous publication shall cease to exist during that period.
3. Where the decision is subject to an appeal before a national judicial, administrative or other authority, the
competent authority shall also publish, immediately, on its official website such information and any subsequent
information on the outcome of such appeal. Any decision annulling a previous decision to impose a sanction or a
measure shall also be published.
4. The competent authority shall ensure that any decision that is published in accordance with this Article shall
remain accessible on its official website for a period of at least five years after its publication. Personal data contained in
the publication shall only be kept on the official website of the competent authority for the period which is necessary in
accordance with the applicable data protection rules.
5. Member States shall annually provide ESMA with aggregated information regarding all administrative sanctions and
other administrative measures imposed pursuant to Article 42. That obligation does not apply to measures of an investi
gatory nature. ESMA shall publish that information in an annual report.
Where Member States have chosen, in accordance with Article 42, to lay down criminal sanctions for infringements of
the provisions referred to in that Article, their competent authorities shall annually provide ESMA with anonymised and
aggregated data regarding all criminal investigations undertaken and criminal sanctions imposed. ESMA shall publish
data on criminal sanctions imposed in an annual report.
Article 46
Colleges
1. Within 30 working days from the inclusion of a benchmark referred to in points (a) and (c) of Article 20(1) in the
list of critical benchmarks, with the exception of benchmarks where the majority of contributors are non-supervised
entities, the competent authority shall establish a college.
2. The college shall comprise the competent authority of the administrator, ESMA, and the competent authorities of
supervised contributors.
3. Competent authorities of other Member States shall have the right to be members of the college where, if the
critical benchmark in question were to cease to be provided, it would have a significant adverse impact on the market
integrity, financial stability, consumers, real economy, or financing of households and businesses of those Member
States.
Where a competent authority intends to become a member of a college, it shall submit a request to the competent
authority of the administrator containing evidence that the requirements of the first subparagraph of this paragraph are
fulfilled. The relevant competent authority of the administrator shall consider the request and notify the requesting
authority within 20 working days of receipt of the request whether or not it considers those requirements to be fulfilled.
Where it considers those requirements not to be fulfilled, the requesting authority may refer the matter to ESMA in
accordance with paragraph 9.
4. ESMA shall contribute to promoting and monitoring the efficient, effective and consistent functioning of colleges
referred to in this Article in accordance with Article 21 of Regulation (EU) No 1095/2010. To that end, ESMA shall
participate as appropriate and shall be considered to be a competent authority for that purpose.
Where ESMA acts in accordance with Article 17(6) of Regulation (EU) No 1095/2010 regarding a critical benchmark, it
shall ensure appropriate exchange of information and cooperation with the other members of the college.
5. The competent authority of an administrator shall chair the meetings of the college, coordinate the actions of the
college and ensure efficient exchange of information among members of the college.
Where an administrator provides more than one critical benchmark, the competent authority of that administrator may
establish a single college in respect of all the benchmarks provided by that administrator.
6. The competent authority of an administrator shall establish written arrangements within the framework of the
college regarding the following matters:
(a) the information to be exchanged between competent authorities;
(b) the decision-making process between the competent authorities and the time frame within which each decision has
to be taken;
(c) the cases in which the competent authorities must consult each other;
(d) the cooperation to be provided under Article 23(7) and (8).
7. The competent authority of an administrator shall give due consideration to any advice provided by ESMA
concerning the written arrangements under paragraph 6 before agreeing their final text. The written arrangements shall
be set out in a single document containing full reasons for any significant deviation from the advice of ESMA. The
competent authority of the administrator shall transmit the written arrangements to the members of the college and to
ESMA.
8. Before taking any measures referred to in Article 23(6), (7) and (9), and Articles 34, 35 and 42, the competent
authority of an administrator shall consult the members of the college. The members of the college shall do everything
reasonable within their power to reach an agreement within the time frame specified in the written arrangements
referred to in paragraph 6 of this Article.
Any decision of the competent authority of the administrator to take such measures shall take into account the impact
on the other Member States concerned, in particular the potential impact on the stability of their financial systems.
With regard to the decision to withdraw the authorisation or registration of an administrator in accordance with
Article 35, whenever the cessation of a benchmark would result in a force majeure event, frustrate or otherwise breach
the terms of any financial contract or financial instrument, or the rules of any investment fund, which references that
benchmark in the Union, within the meaning specified by the Commission in any delegated act adopted pursuant to
Article 51(6), the competent authorities within the college shall consider whether to adopt measures to mitigate the
effects referred to in this paragraph, including:
(a) a change to the code of conduct referred to in Article 15, the methodology or other rules of the benchmark;
(b) a transitional period, during which the procedures envisaged under Article 28(2) shall apply.
9. In the absence of agreement between the members of a college, competent authorities may refer to ESMA any of
the following situations:
(a) where a competent authority has not communicated essential information;
(b) where, following a request made under paragraph 3, the competent authority of the administrator has notified the
requesting authority that the requirements of that paragraph are not fulfilled or where it has not acted upon such
request within a reasonable time;
(c) where the competent authorities have failed to reach an agreement on the matters set out in paragraph 6;
(d) where there is a disagreement concerning the measures to be taken in accordance with Articles 34, 35 and 42;
(e) where there is a disagreement concerning the measures to be taken in accordance with Article 23(6);
(f) where there is a disagreement concerning the measures to be taken in accordance with the third subparagraph of
paragraph 8 of this Article.
10. In the situations referred to in points (a), (b), (c), (d) and (f) of paragraph 9, if the issue is not settled within
30 days after referral to ESMA, the competent authority of an administrator shall take the final decision and provide a
detailed explanation of its decision in writing to the competent authorities referred to in that paragraph and to ESMA.
The period of time referred to in point (a) of Article 34(6) shall be suspended from the date of referral to ESMA until
such time as a decision is taken in accordance with the first subparagraph of this paragraph.
Where ESMA considers that the competent authority of the administrator has taken any measures referred to in
paragraph 8 of this Article which may not be in conformity with Union law it shall act in accordance with Article 17 of
Regulation (EU) No 1095/2010.
11. In the situation referred to in point (e) of paragraph 9 of this Article, and without prejudice to Article 258 TFEU,
ESMA may act in accordance with the powers conferred on it under Article 19 of Regulation (EU) No 1095/2010.
The power of the competent authority of an administrator under Article 23(6) may be exercised until such time as
ESMA publishes its decision.
Article 47
Cooperation with ESMA
1. The competent authorities shall cooperate with ESMA for the purposes of this Regulation, in accordance with
Regulation (EU) No 1095/2010.
2. The competent authorities shall, without delay, provide ESMA with all information necessary to carry out its
duties, in accordance with Article 35 of Regulation (EU) No 1095/2010.
3. ESMA shall develop draft implementing technical standards to determine the procedures and forms for exchange
of information as referred to in paragraph 2.
by 1 April 2017.
Article 48
Professional secrecy
1. Any confidential information received, exchanged or transmitted pursuant to this Regulation shall be subject to the
conditions of professional secrecy laid down in paragraph 2.
2. The obligation of professional secrecy applies to all persons who work or who have worked for the competent
authority or for any authority or market undertaking or natural or legal person to whom the competent authority has
delegated its powers, including auditors and experts contracted by the competent authority.
3. Information covered by professional secrecy may not be disclosed to any other person or authority except by
virtue of provisions laid down by Union or national law.
4. All information exchanged between the competent authorities under this Regulation that concerns business or
operational conditions and other economic or personal affairs shall be considered confidential and shall be subject to
the requirements of professional secrecy, except where the competent authority states at the time of communication that
such information may be disclosed or where such disclosure is necessary for legal proceedings.
TITLE VII
DELEGATED AND IMPLEMENTING ACTS
Article 49
Exercise of the delegation
1. The power to adopt delegated acts is conferred on the Commission subject to the conditions laid down in this
Article.
2. The power to adopt delegated acts referred to in Articles 3(2), 20(6), 24(2), 33(7), 51(6) and 54(3) shall be
conferred on the Commission for an indeterminate period of time from 30 June 2016.
3. The delegation of power referred to in Articles 3(2), 20(6), 24(2), 33(7), 51(6) and 54(3) may be revoked at any
time by the European Parliament or by the Council. A decision to revoke shall put an end to the delegation of power
specified in that decision. It shall take effect on the day following the publication of the decision in the Official Journal of
the European Union or on a later date specified therein. It shall not affect the validity of any delegated acts already in
force.
4. Before adopting a delegated act, the Commission shall consult experts designated by each Member State in
accordance with the principles laid down in the Interinstitutional Agreement on Better Law-Making of 13 April 2016.
5. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to the European Parliament and
to the Council.
6. A delegated act adopted pursuant to Articles 3(2), 20(6), 24(2), 33(7), 51(6) and 54(3) shall enter into force only if
no objection has been expressed either by the European Parliament or by the Council within a period of three months
of notification of that act to the European Parliament and the Council or if, before the expiry of that period, the
European Parliament and the Council have both informed the Commission that they will not object. That period shall be
extended by three months at the initiative of the European Parliament or of the Council.
Article 50
Committee procedure
1. The Commission shall be assisted by the European Securities Committee. That committee shall be a committee
within the meaning of Regulation (EU) No 182/2011.
2. Where reference is made to this paragraph, Article 5 of Regulation (EU) No 182/2011 shall apply, having regard to
the provisions of Article 8 thereof.
TITLE VIII
TRANSITIONAL AND FINAL PROVISIONS
Article 51
Transitional provisions
1. An index provider providing a benchmark on 30 June 2016 shall apply for authorisation or registration in
accordance with Article 34 by 1 January 2020.
2. By 1 January 2020, the competent authority of the Member State where an index provider applying for authoris
ation in accordance with Article 34 is located shall have the power to decide to register that index provider as an
administrator even if it is not a supervised entity, under the following conditions:
(a) the index provider does not provide a critical benchmark;
(b) the competent authority is aware, on a reasonable basis, that the index or indices provided by the index provider are
not widely used, within the meaning of this Regulation, in the Member State where the index provider is located as
well as in other Member States.
The competent authority shall notify ESMA of its decision adopted in accordance with the first subparagraph.
The competent authority shall keep evidence of the reasons for its decision adopted in accordance with the first
subparagraph, in such a form that it is possible to fully understand the evaluations of the competent authority that the
index or indices provided by the index provider are not widely used, including any market data, judgement or other
information, as well as information received from the index provider.
3. An index provider may continue to provide an existing benchmark which may be used by supervised entities until
1 January 2020 or, where the index provider submits an application for authorisation or registration in accordance with
paragraph 1, unless and until such authorisation or registration is refused.
4. Where an existing benchmark does not meet the requirements of this Regulation, but ceasing or changing that
benchmark to fulfil the requirements of this Regulation would result in a force majeure event, frustrate or otherwise
breach the terms of any financial contract or financial instrument or the rules of any investment fund, which references
that benchmark, the use of the benchmark shall be permitted by the competent authority of the Member State where
the index provider is located. No financial instruments, financial contracts, or measurements of the performance of an
investment fund shall add a reference to such an existing benchmark after 1 January 2020.
5. Unless the Commission has adopted an equivalence decision as referred to in Article 30(2) or (3) or unless an
administrator has been recognised pursuant to Article 32, or a benchmark has been endorsed pursuant to Article 33,
the use in the Union by supervised entities of a benchmark provided by an administrator located in a third country
where the benchmark is already used in the Union as a reference for financial instruments, financial contracts, or for
measuring the performance of an investment fund, shall be permitted only for such financial instruments, financial
contracts and measurements of the performance of an investment fund that already reference the benchmark in the
Union on, or which add a reference to such benchmark prior to, 1 January 2020.
6. The Commission shall be empowered to adopt delegated acts in accordance with Article 49 concerning measures
to determine the conditions on which the relevant competent authority may assess whether the cessation or the
changing of an existing benchmark to conform with the requirements of this Regulation could reasonably result in a
force majeure event, frustrate or otherwise breach the terms of any financial contract or financial instrument or the
rules of any investment fund which references such benchmark.
Article 52
Deadline for updating the prospectuses and key information documents
Article 29(2) is without prejudice to outstanding prospectuses approved under Directive 2003/71/EC prior to 1 January
2018. For prospectuses approved prior to 1 January 2018 under Directive 2009/65/EC, the underlying documents shall
be updated at the first occasion or at the latest within 12 months after that date.
Article 53
ESMA reviews
1. ESMA shall seek to build a common European supervisory culture and consistent supervisory practices and ensure
consistent approaches among competent authorities in relation to the application of Articles 32 and 33. To that end, the
recognitions granted in accordance with Article 32 and the endorsements authorised in accordance with Article 33 shall
be reviewed by ESMA every two years.
ESMA shall issue an opinion to each competent authority that has recognised a third country administrator or endorsed
a third country benchmark assessing how that competent authority applies the relevant requirements of Articles 32 and
33 respectively and the requirements of any relevant delegated act and regulatory or implementing technical standard
based on this Regulation.
2. ESMA shall have the power to require the documented evidence from a competent authority for any of the
decisions adopted in accordance with the first subparagraph of Article 51(2), Article 24(1) and Article 25(2).
Article 54
Review
1. By 1 January 2020, the Commission shall review and submit a report to the European Parliament and to the
Council on this Regulation and in particular on:
(a) the functioning and effectiveness of the critical benchmark, mandatory administration and mandatory contribution
regime under Articles 20, 21 and 23 and the definition of a critical benchmark in point (25) of Article 3(1);
(b) the effectiveness of the authorisation, registration and supervision regime of administrators under Title VI and the
colleges under Article 46 and the appropriateness of supervision of certain benchmarks by a Union body;
(c) the functioning and effectiveness of Article 19(2), in particular the scope of its application.
2. The Commission shall review the evolution of international principles applicable to benchmarks and of legal
frameworks and supervisory practices in third countries concerning the provision of benchmarks and report to the
European Parliament and to the Council every five years after 1 January 2018. That report shall assess in particular
whether there is a need to amend this Regulation and shall be accompanied by a legislative proposal, if appropriate.
3. The Commission shall be empowered to adopt delegated acts in accordance with Article 49 in order to extend the
42-month period referred to in Article 51(2) by 24 months, if the report referred to in point (b) of paragraph 1 of this
Article provides evidence that the transitional registration regime under Article 51(2) is not detrimental to a common
European supervisory culture and consistent supervisory practices and approaches among competent authorities.
Article 55
Notification of benchmarks referenced and their administrators
When a benchmark is referenced in a financial instrument covered by Article 4(1) of Regulation (EU) No 596/2014, the
notifications under Article 4(1) of that Regulation shall include the name of the benchmark referenced and its adminis
trator.
Article 56
Amendments to Regulation (EU) No 596/2014
Regulation (EU) No 596/2014 is amended as follows:
(1) Article 19 is amended as follows:
(a) the following paragraph is inserted:
‘1a. The notification obligation referred to in paragraph 1 shall not apply to transactions in financial
instruments linked to shares or to debt instruments of the issuer referred to in that paragraph where at the time
of the transaction any of the following conditions is met:
(a) the financial instrument is a unit or share in a collective investment undertaking in which the exposure to
the issuer's shares or debt instruments does not exceed 20 % of the assets held by the collective investment
undertaking;
(b) the financial instrument provides exposure to a portfolio of assets in which the exposure to the issuer's
shares or debt instruments does not exceed 20 % of the portfolio's assets;
(c) the financial instrument is a unit or share in a collective investment undertaking or provides exposure to a
portfolio of assets and the person discharging managerial responsibilities or person closely associated with
such a person does not know, and could not know, the investment composition or exposure of such
collective investment undertaking or portfolio of assets in relation to the issuer's shares or debt instruments,
and furthermore there is no reason for that person to believe that the issuer's shares or debt instruments
exceed the thresholds in point (a) or (b).
If information regarding the investment composition of the collective investment undertaking or exposure to the
portfolio of assets is available, then the person discharging managerial responsibility or person closely associated
with such a person shall make all reasonable efforts to avail themselves of that information.’;
(b) in paragraph 7, the following subparagraph is inserted after the second subparagraph:
‘For the purposes of point (b), transactions executed in shares or debt instruments of an issuer or derivatives or
other financial instruments linked thereto by managers of a collective investment undertaking in which the
person discharging managerial responsibilities or a person closely associated with them has invested do not need
to be notified where the manager of the collective investment undertaking operates with full discretion, which
excludes the manager receiving any instructions or suggestions on portfolio composition directly or indirectly
from investors in that collective investment undertaking.’.
(2) Article 35 is amended as follows:
(a) in paragraphs (2) and (3), the phrase ‘and Article 19(13) and (14)’ is replaced by ‘, Article 19(13) and (14) and
Article 38’;
(b) paragraph (5) is replaced by the following:
‘5. A delegated act adopted pursuant to Article 6(5) or (6), Article 12(5), the third subparagraph of
Article 17(2), Article 17(3), Article 19(13) or (14) or Article 38, shall enter into force only if no objection has
been expressed either by the European Parliament or the Council within a period of three months of notification
of that act to the European Parliament and the Council or if, before the expiry of that period, the European
Parliament and the Council have both informed the Commission that they will not object. That period shall be
extended by three months at the initiative of the European Parliament or the Council.’.
(3) In Article 38, the following paragraphs are added:
‘By 3 July 2019, the Commission shall, after consulting ESMA, submit a report to the European Parliament and to
the Council on the level of the thresholds set out in Article 19(1a)(a) and (b) in relation to managers' transactions
where the issuer's shares or debt instruments form part of a collective investment undertaking or provide exposure
to a portfolio of assets, with a view to assessing whether that level is appropriate or should be adjusted.
The Commission shall be empowered to adopt delegated acts in accordance with Article 35 adjusting the thresholds
in Article 19(1a)(a) and (b), if it determines in that report that those thresholds should be adjusted.’.
Article 57
Amendments to Directive 2008/48/EC
Directive 2008/48/EC is amended as follows:
(1) In Article 5(1), the following subparagraph is inserted after the second subparagraph:
‘Where the credit agreement references a benchmark as defined in point 3 of Article 3(1) of Regulation (EU)
2016/1011 of the European Parliament and of the Council (*), the name of the benchmark and of its administrator
and the potential implications on the consumer shall be provided by the creditor, or where applicable, by the credit
intermediary, to the consumer in a separate document, which may be annexed to the Standard European Consumer
Credit Information form.
(*) Regulation (EU) 2016/1011, of the European Parliament and of the Council of 8 June 2016 on indices used as
benchmarks in financial instruments and financial contracts or to measure the performance of investment funds
and amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) No 596/2014 (OJ L 171,
29.6.2016, p. 1).’.
(2) In Article 27(1), the following subparagraph is inserted after the second subparagraph:
‘By 1 July 2018 Member States shall adopt and publish the provisions necessary to comply with the third
subparagraph of Article 5(1) and shall communicate them to the Commission. They shall apply those provisions
from 1 July 2018.’.
Article 58
Amendments to Directive 2014/17/EU
Directive 2014/17/EU is amended as follows:
(1) In the second subparagraph of Article 13(1), the following point is inserted:
‘(ea) where contracts that reference a benchmark as defined in point (3) of Article 3(1) of Regulation (EU)
2016/1011 of the European Parliament and of the Council (*) are available, the names of the benchmarks and
of their administrators and the potential implications on the consumer;
(*) Regulation (EU) 2016/1011, of the European Parliament and of the Council of 8 June 2016 on indices used as
benchmarks in financial instruments and financial contracts or to measure the performance of investment funds
and amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) No 596/2014 (OJ L 171, 29.6.2016,
p. 1).’;
(2) In Article 42(2), the following subparagraph is inserted after the first subparagraph:
‘By 1 July 2018, Member States shall adopt and publish the provisions necessary to comply with point (ea) of the
second subparagraph of Article 13(1) and shall communicate them to the Commission. They shall apply those
provisions from 1 July 2018.’;
(3) In Article 43(1), the following subparagraph is added:
‘Point (ea) of the second subparagraph of Article 13(1) shall not apply to credit agreements existing before 1 July
2018.’.
Article 59
Entry into force
This Regulation shall enter into force on the day following that of its publication in the Official Journal of the European
Union.
It shall apply from 1 January 2018.
Notwithstanding the second paragraph of this Article, Articles 3(2), 5(5), 11(5), 13(3), 15(6), 16(5), Article 20
(excluding point (b) of paragraph (6)), Articles 21 and 23, Articles 25(8), 25(9), 26(5), 27(3), 30(5), 32(9), 33(7), 34(8),
Article 46, and Articles 47(3) and 51(6) shall apply from 30 June 2016.
Notwithstanding the second paragraph of this Article, Article 56 shall apply from 3 July 2016.
This Regulation shall be binding in its entirety and directly applicable in all Member States.
Done at Strasbourg, 8 June 2016.
For the European Parliament For the Council

The President The President
M. SCHULZ A.G. KOENDERS
ANNEX I
INTEREST RATE BENCHMARKS
Accurate and sufficient data
1. For the purposes of points (a) and (c) of Article 11(1), in general the priority of use of input data shall be as follows:
(a) a contributor's transactions in the underlying market that a benchmark intends to measure or, if not sufficient, its
transactions in related markets, such as:
— the unsecured inter-bank deposit market,
— other unsecured deposit markets, including certificates of deposit and commercial paper, and
— other markets such as overnight index swaps, repurchase agreements, foreign exchange forwards, interest rate
futures and options, provided that those transactions comply with the input data requirements in the code of
conduct;
(b) a contributor's observations of third party transactions in the markets described in point (a);
(c) committed quotes;
(d) indicative quotes or expert judgements.
2. For the purposes of point (a) of Article 11(1) and Article 11(4), input data may be adjusted.
In particular, input data may be adjusted by application of the following criteria:
(a) proximity of transactions to the time of provision of the input data and the impact of any market events between
the time of the transactions and the time of provision of the input data;
(b) interpolation or extrapolation from transactions data;
(c) adjustments to reflect changes in the credit standing of the contributors and other market participants.
Oversight function
3. The following requirements shall apply in substitution for the requirements of Article 5(4) and (5):
(a) the administrator of an interest rate benchmark shall have in place an independent oversight committee. Details
of the membership of that committee shall be made public, along with any declarations of any conflict of interest
and the processes for election or nomination of its members;
(b) the oversight committee shall hold no less than one meeting every four months and shall keep minutes of each
such meeting;
(c) the oversight committee shall operate with integrity and shall have all of the responsibilities provided for in
Article 5(3).
Auditing
4. The administrator of an interest rate benchmark shall appoint an independent external auditor to review and report
on the administrator's compliance with the benchmark methodology and this Regulation. The external audit of the
administrator shall be carried out for the first time six months after the introduction of the code of conduct and
subsequently every two years.
The oversight committee may require an external audit of a contributor to an interest rate benchmark if dissatisfied
with any aspects of its conduct.
Contributor systems and controls
5. The following requirements shall apply to contributors to interest rate benchmarks, in addition to the requirements
set out in Article 16. Article 16(5) shall not apply.
6. Each contributor's submitter and the direct managers of that submitter shall acknowledge in writing that they have
read the code of conduct and that they will comply with it.
7. A contributor's systems and controls shall include:
(a) an outline of responsibilities within each firm, including internal reporting lines and accountability, including
the location of submitters and managers and the names of relevant individuals and alternates;
(b) internal procedures for sign-off of contributions of input data;
(c) disciplinary procedures in respect of attempts to manipulate, or any failure to report, actual or attempted
manipulation by parties external to the contribution process;
(d) effective conflicts of interest management procedures and communication controls, both within contributors
and between contributors and other third parties, to avoid any inappropriate external influence over those
responsible for submitting rates. Submitters shall work in locations physically separated from interest rate
derivatives traders;
(e) effective procedures to prevent or control the exchange of information between persons engaged in activities
involving a risk of conflict of interest where the exchange of that information may affect the benchmark data
contributed;
(f) rules to avoid collusion among contributors, and between contributors and the benchmark administrators;
(g) measures to prevent, or limit, any person from exercising inappropriate influence over the way in which
persons involved in the provision of input data carries out those activities;
(h) the removal of any direct link between the remuneration of employees involved in the provision of input data
and the remuneration of, or revenues generated by, persons engaged in another activity, where a conflict of
interest may arise in relation to those activities;
(i) controls to identify any reverse transaction subsequent to the provision of input data.
8. A contributor to an interest rate benchmark shall keep detailed records of:
(a) all relevant aspects of contributions of input data;
(b) the process governing input data determination and the sign-off of input data;
(c) the names of submitters and their responsibilities;
(d) any communications between the submitters and other persons, including internal and external traders and
brokers, in relation to the determination or contribution of input data;
(e) any interaction of submitters with the administrator or any calculation agent;
(f) any queries regarding the input data and their outcome of those queries;
(g) sensitivity reports for interest rate swap trading books and any other derivative trading book with a significant
exposure to interest rate fixings in respect of input data.
9. Records shall be kept on a medium that allows the storage of information to be accessible for future reference with
a documented audit trail.
10. The compliance function of the contributor to an interest rate benchmark shall report any findings, including
reverse transactions, to management on a regular basis.
11. Input data and procedures shall be subject to regular internal reviews.
12. An external audit of the input data of a contributor to an interest rate benchmark, compliance with the code of
conduct and the provisions of this Regulation shall be carried out for the first time six months after the
introduction of the code of conduct, and subsequently every two years.
ANNEX II
COMMODITY BENCHMARKS
Methodology
1. The administrator of a commodity benchmark shall formalise, document, and make public any methodology that the
administrator uses for a benchmark calculation. At a minimum, such methodology shall contain and describe the
following:
(a) all criteria and procedures that are used to develop the benchmark, including how the administrator uses input
data including the specific volume, concluded and reported transactions, bids, offers and any other market
information in its assessment or assessment time periods or windows, why a specific reference unit is used, how
the administrator collects such input data, the guidelines that control the exercise of judgement by assessors and
any other information, such as assumptions, models or extrapolation from collected data that are considered in
making an assessment;
(b) procedures and practices that are designed to ensure consistency between its assessors in exercising their
judgement;
(c) the relative importance that shall be assigned to each criterion used in benchmark calculation, in particular the
type of input data used and the type of criterion used to guide judgement so as to ensure the quality and
integrity of the benchmark calculation;
(d) criteria that identify the minimum amount of transaction data required for a particular benchmark calculation. If
no such threshold is provided for, the reasons why a minimum threshold is not established shall be explained,
including setting out the procedures to be used where no transaction data exist;
(e) criteria that address the assessment periods where the submitted data fall below the methodology's recommended
transaction data threshold or the requisite administrator's quality standards, including any alternative methods of
assessment including theoretical estimation models. Those criteria shall explain the procedures to be used where
no transaction data exist;
(f) criteria for timeliness of contributions of input data and the means for such contributions of input data whether
electronically, by telephone or otherwise;
(g) criteria and procedures that address assessment periods where one or more contributors submit input data that
constitute a significant proportion of the total input data for that benchmark. The administrator shall also define
in those criteria and procedures what constitutes a significant proportion for each benchmark calculation;
(h) criteria according to which transaction data may be excluded from a benchmark calculation.
2. The administrator of a commodity benchmark shall publish or make available the key elements of the methodology
that the administrator uses for each commodity benchmark provided and published or, when applicable, for each
family of benchmarks provided and published.
3. Along with the methodology referred to in paragraph 2, the administrator of a commodity benchmark shall also
describe and publish all of the following:
(a) the rationale for adopting a particular methodology, including any price adjustment techniques and a justification
of why the time period or window within which input data is accepted is a reliable indicator of physical market
values;
(b) the procedure for internal review and approval of a given methodology, as well as the frequency of such review;
(c) the procedure for external review of a given methodology, including the procedures to gain market acceptance of
the methodology through consultation with users on important changes to their benchmark calculation
processes.
Changes to a methodology
4. The administrator of a commodity benchmark shall adopt and make public to users explicit procedures and the
rationale of any proposed material change in its methodology. Those procedures shall be consistent with the
overriding objective that an administrator must ensure the continued integrity of its benchmark calculations and
implement changes for good order of the particular market to which such changes relate. Such procedures shall
provide:
(a) advance notice in a clear time frame that gives users sufficient opportunity to analyse and comment on the
impact of such proposed changes, having regard to the administrator's calculation of the overall circumstances;
(b) for users' comments, and the administrator's response to those comments, to be made accessible to all market
users after any given consultation period, except where the commenter has requested confidentiality.
5. The administrator of a commodity benchmark shall regularly examine its methodologies for the purpose of ensuring
that they reliably reflect the physical market under assessment and shall include a process for taking into account the
views of relevant users.
Quality and integrity of benchmark calculations
6. The administrator of a commodity benchmark shall:
(a) specify the criteria that define the physical commodity that is the subject of a particular methodology;
(b) give priority to input data in the following order, where consistent with its methodologies:
(i) concluded and reported transactions;
(ii) bids and offers;
(iii) other information.
If concluded and reported transactions are not given priority, the reasons should be explained, as required in
point 7(b).
(c) employ sufficient measures designed to use input data submitted and considered in a benchmark calculation
which are bona fide, meaning that the parties submitting the input data have executed, or are prepared to
execute, transactions generating such input data and the concluded transactions were executed at arms-length
from each other and particular attention shall be paid to inter-affiliate transactions;
(d) establish and employ procedures to identify anomalous or suspicious transaction data and keep records of
decisions to exclude transaction data from the administrator's benchmark calculation process;
(e) encourage contributors to submit all of their input data that falls within the administrator's criteria for that
calculation. Administrators shall seek, so far as they are able and is reasonable, to ensure that input data
submitted is representative of the contributors' actual concluded transactions; and
(f) employ a system of appropriate measures to ensure that contributors comply with the administrator's applicable
quality and integrity standards for input data.
7. The administrator of a commodity benchmark shall describe and publish for each calculation, to the extent
reasonable without prejudicing due publication of the benchmark:
(a) a concise explanation, sufficient to facilitate a benchmark subscriber's or competent authority's ability to
understand how the calculation was developed including, at a minimum, the size and liquidity of the physical
market being assessed (such as the number and volume of transactions submitted), the range and average volume
and range and average of price, and indicative percentages of each type of input data that have been considered
in a calculation; terms referring to the pricing methodology shall be included such as transaction-based, spread-
based or interpolated or extrapolated; and
(b) a concise explanation of the extent to which, and the basis upon which, any judgement including the exclusions
of data which otherwise conformed to the requirements of the relevant methodology for that calculation, basing
prices on spreads or interpolation, extrapolation, or weighting bids or offers higher than concluded transactions,
if any, was used in any calculation.
Integrity of the reporting process
8. The administrator of a commodity benchmark shall:
(a) specify the criteria that define who may submit input data to the administrator;
(b) have in place quality control procedures to evaluate the identity of a contributor and any submitter who reports
input data and the authorisation of such submitter to report input data on behalf of a contributor;
(c) specify the criteria applied to employees of a contributor who are permitted to submit input data to an adminis
trator on behalf of a contributor; encourage contributors to submit transaction data from back office functions
and seek corroborating data from other sources where transaction data is received directly from a trader; and
(d) implement internal controls and written procedures to identify communications between contributors and
assessors that attempt to influence a calculation for the benefit of any trading position (whether of the
contributor, its employees or any third party), attempt to cause an assessor to violate the administrator's rules or
guidelines or identify contributors that engage in a pattern of submitting anomalous or suspicious transaction
data. Those procedures shall include, to the extent possible, provision for escalation of the inquiry by the adminis
trator within the contributor's company. Controls shall include cross-checking market indicators to validate
submitted information.
Assessors
9. In relation to the role of an assessor, the administrator of a commodity benchmark shall:
(a) adopt and have in place explicit internal rules and guidelines for selecting assessors, including their minimum
level of training, experience and skills, as well as the process for periodic review of their competence;
(b) have in place arrangements to ensure that calculations can be made on a consistent and regular basis;
(c) maintain continuity and succession planning in respect of its assessors in order to ensure that calculations are
made consistently and by employees who possess the relevant levels of expertise; and
(d) establish internal control procedures to ensure the integrity and reliability of calculations. At a minimum, such
internal controls and procedures shall require the ongoing supervision of assessors to ensure that the
methodology was properly applied and procedures for internal sign-off by a supervisor prior to releasing prices
for dissemination to the market.
Audit trails
10. The administrator of a commodity benchmark shall have rules and procedures in place to document contempora
neously relevant information, including:
(a) all input data;
(b) the judgements that are made by assessors in reaching each benchmark calculation;
(c) whether a calculation excluded a particular transaction which otherwise conformed to the requirements of the
relevant methodology for that calculation, and the rationale for doing so;
(d) the identity of each assessor and of any other person who submitted or otherwise generated any of the
information in points (a), (b) or (c).
11. The administrator of a commodity benchmark shall have rules and procedures in place to ensure that an audit trail
of relevant information is retained for at least five years in order to document the construction of its calculations.
Conflicts of interest
12. The administrator of a commodity benchmark shall establish adequate policies and procedures for the identification,
disclosure, management or mitigation and avoidance of any conflict of interest and the protection of integrity and
independence of calculations. Those policies and procedures shall be reviewed and updated regularly and shall:
(a) ensure that benchmark calculations are not influenced by the existence of, or potential for, a commercial or
personal business relationship or interest between the administrator or its affiliates, its personnel, clients, any
market participant or persons connected with them;
(b) ensure that personal interests and business connections of the administrator's personnel are not permitted to
compromise the administrator's functions, including outside employment, travel, and acceptance of
entertainment, gifts and hospitality provided by the administrator's clients or other commodity market
participants;
(c) ensure, in respect of identified conflicts, appropriate segregation of functions within the administrator by way of
supervision, compensation, systems access and information flows;
(d) protect the confidentiality of information submitted to or produced by the administrator, subject to the
disclosure obligations of the administrator;
(e) prohibit managers, assessors and other employees of the administrator from contributing to a benchmark
calculation by way of engaging in bids, offers and trades on either a personal basis or on behalf of market
participants; and
(f) effectively address any identified conflict of interest which may exist between the administrator's provision of a
benchmark (including all employees who perform or otherwise participate in benchmark calculation responsi
bilities), and any other business of the administrator.
13. The administrator of a commodity benchmark shall ensure that its other business operations have in place
appropriate procedures and mechanisms designed to minimise the likelihood that a conflict of interest will affect
the integrity of benchmark calculations.
14. The administrator of a commodity benchmark shall ensure that it has in place segregated reporting lines amongst
its managers, assessors and other employees and from the managers to the administrator's most senior level
management and its board to ensure:
(a) that the administrator satisfactorily implements the requirements of this Regulation; and
(b) that responsibilities are clearly defined and do not conflict or cause a perception of conflict.
15. The administrator of a commodity benchmark shall disclose to its users as soon as it becomes aware of a conflict of
interest arising from the ownership of the administrator.
Complaints
16. The administrator of a commodity benchmark shall have in place and publish a complaints handling policy setting
out procedures for receiving, investigating and retaining records concerning complaints made about an adminis
trator's calculation process. Such complaint mechanisms shall ensure that:
(a) subscribers of the benchmark may submit complaints on whether a specific benchmark calculation is represen
tative of market value, proposed benchmark calculation changes, applications of methodology in relation to a
specific benchmark calculation and other editorial decisions in relation to the benchmark calculation processes;
(b) there is in place a target timetable for the handling of complaints;
(c) formal complaints made against the administrator and its personnel are investigated by that administrator in a
timely and fair manner;
(d) the inquiry is conducted independently of any personnel who may be involved in the subject of the complaint;
(e) the administrator aims to complete its investigation promptly;
(f) the administrator advises the complainant and any other relevant parties of the outcome of the investigation in
writing and within a reasonable period;
(g) there is recourse to an independent third party appointed by the administrator. if a complainant is dissatisfied
with the way a complaint has been handled by the relevant administrator or the administrator's decision in the
situation no later than six months from the time of the original complaint; and
(h) all documents relating to a complaint, including those submitted by the complainant as well as an adminis
trator's own record, are retained for a minimum of five years.
17. Disputes as to daily pricing determinations, which are not formal complaints, shall be resolved by the administrator
of a commodity benchmark with reference to its appropriate standard procedures. If a complaint results in a change
in price, the details of that change in price shall be communicated to the market as soon as possible.
External auditing
18. The administrator of a commodity benchmark shall appoint an independent external auditor with appropriate
experience and capability to review and report on the administrator's adherence to its stated methodology criteria
and with the requirements of this Regulation. Audits shall take place annually and be published three months after
each audit is completed with further interim audits carried out as appropriate.

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29.6.

2016 EN Official Journal of the European Union L 171/1

REGULATION (EU) 2016/1011 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

(Text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Having regard to the opinion of the European Central Bank (1),

Acting in accordance with the ordinary legislative procedure (3),

(1) OJ C 113, 15.4.2014, p. 1.

(1) OJ L 123, 12.5.2016, p. 1.

HAVE ADOPTED THIS REGULATION:

SUBJECT MATTER, SCOPE AND DEFINITIONS

2. This Regulation shall not apply to:

(a) a central bank;

1. For the purposes of this Regulation, the following definitions apply:

(1) ‘index’ means any figure:

(a) that is published or made available to the public;

(b) that is regularly determined:

(5) ‘provision of a benchmark’ means:

(a) administering the arrangements for determining a benchmark;

(7) ‘use of a benchmark’ means:

(a) issuance of a financial instrument which references an index or a combination of indices;

(9) ‘contributor’ means a natural or legal person contributing input data;

(17) ‘supervised entity’ means any of the following:

(d) a reinsurance undertaking as defined in point (4) of Article 13 of Directive 2009/138/EC;

(18) ‘financial contract’ means:

(a) input data contributed entirely and directly from:

(b) net asset values of investment funds;

(29) ‘public authority’ means:

BENCHMARK INTEGRITY AND RELIABILITY

Governance of and control by administrators

Governance and conflict of interest requirements

Oversight function requirements

(a) reviewing the benchmark's definition and methodology at least annually;

Control framework requirements

3. The control framework shall include:

(a) management of operational risk;

4. An administrator shall establish measures to:

Accountability framework requirements

1. An administrator shall keep records of:

(a) all input data, including the use of such data;

(b) the methodology used for the determination of a benchmark;

2. Such a complaints-handling mechanism shall ensure that:

Input data, methodology and reporting of infringements

(b) the input data referred to in point (a) shall be verifiable;

1. An administrator shall use a methodology for determining a benchmark that:

(a) is robust and reliable;

(e) is traceable and verifiable.

2. When developing a benchmark methodology, a benchmark administrator shall:

(c) establish the priority given to different types of input data.

Code of conduct and requirements for contributors

2. The code of conduct shall include at least the following elements:

(ii) policies on the use of discretion in contributing input data;

(iv) record-keeping policies;

(v) reporting requirements concerning suspicious input data;

(vi) requirements concerning the management of conflicts of interest.

Governance and control requirements for supervised contributors