The Commission has today adopted a delegated act under the Benchmark Regulation to extend the transition period to 31 December 2025 for third country benchmarks used by supervised entities. Benchmarks are an intrinsic part of financial markets: they are indices used to price financial instruments and contracts (including households’ mortgages) or to measure the performance of an investment fund.
The Benchmark Regulation, adopted in 2016, contains rules on the use of benchmarks administered in a third country. These new rules were meant to apply from the beginning of 2024. However, the Commission’s fact-finding exercise concluded that a majority of third country benchmark administrators have not taken the necessary steps to prepare for the end of this transition period.
As a result, EU market players would no longer be able to access most of the world’s benchmarks, which would likely put EU supervised entities at a significant competitive disadvantage in global competition, and pose potential risks to financial stability. The extension provided by the delegated act adopted today aims at avoiding those risks, provide market players with legal certainty and ensure business continuity. These reasons are outlined in a report published today which accompanies the delegated act. In parallel, the Commission is working on a longer-term solution to adapt the third country regime of the Benchmark Regulation.
