Brussels, 10/02/2015 (Agence Europe) - At this Friday's meeting of Coreper, the member states of the EU are to agree on a common position on the regulation proposed in September 2013 by the European Commission, aiming to improve the governance of benchmarks. The Council is now only waiting for the EP, which is to take position in committee on the report by Cora van Nieuwenhuizen (ALDE, Netherlands), on 5 March.
Two major changes have been brought in by the member states which, according to the Presidency document, unanimously support the compromise text, of which EUROPE has had sight. These refer to the provisions for third countries, and the definition of 'critical benchmarks'. Over at the EP, it is also mainly on these two aspects that the MEPs hope to change the Commission's text.
The member states have brought in a new category of benchmarks defined as 'critical' and covering funds of the total value of at least €400 billion, in other words benchmarks used broadly and with few appropriate substitutes. National supervisors will also be able to submit proposals for benchmarks which are smaller, but of national importance, to the European Securities Markets Authority (ESMA). ESMA will have six weeks to take position.
The text also brings in an approval regime to allow the EU administrators to use benchmarks available in third countries, under certain conditions. Third-country administrators must first be recognised, for which an appropriate cooperation arrangement must be set in place between the competent authority of the member state in question and the authority of the third country of the administrator, in order to ensure an effective exchange of information. The supervision and investigation operations of the authorities of the member states may not be banned under the legislation or administrative provisions of the third country, or by the limitation of the powers of the third-country authority in this area.
The Commission appears to be satisfied with the text of the member states, which remains broadly in line with the Commission's objectives of reinforcing governance and control in creating benchmarks, limiting conflicts of interest, improving the methodology and quality of data and ensuring adequate protection for consumers via increased transparency. The Council's text also ensures full consistency with the IOSCO principles. (Elodie Lamer)