From 1/1/2020, EU-based index providers were required to become authorised by EU authorities in order for usage (as defined below) of their indices to continue.
Benchmarks usage that requires the administrator to become authorized:
From 31/12/2023, non-EU based (“third country”) index providers whose indices are used in any of the ways noted above will have to either seek recognition as a third country index provider, or endorsement of their indices. Without one or the other, any existing usage has to cease by that date.
Moorgate Benchmarks GmbH works with existing EU benchmark administrators who are not yet authorised, and with new administrators, to help them become compliant with their regulatory obligations and to make their regulatory applications, and we provide administration services that can in some circumstances remove the need for clients to themselves become regulated benchmark administrators.
Under certain circumstances it may be possible for an existing benchmark administrator to transfer the administration of some or all of its benchmarks to Moorgate Benchmarks GmbH, enabling the administrator to focus on its core businesses while Moorgate Benchmarks GmbH works in partnership to ensure best in class administration and governance of the benchmarks. This removes the need for the original administrator to gain authorisation.
Under this option, the index provider applies for “recognition” via ESMA. As part of its application, it is required to demonstrate it has a contractual agreement with an EU-based “legal representative” that takes on the legal risk of providing benchmarks within the EU, and that together with the index provider, “oversees” the provider’s indices. Moorgate Benchmarks GmbH offers this service.
Under this option, Moorgate Benchmarks GmbH applies to its EU regulator to endorse a third country index provider’s indices as suitable for use within the EU. Moorgate takes on an oversight role together with the index provider.
We were one of the first benchmark administrators regulated under the EU Benchmarks Regulation and will be a regulated benchmark administrator under both the EU and the UK Benchmarks Regulations from early 2021 onwards. We have successfully worked with EU and non-EU benchmark administrators to design and document their processes and procedures, and to build and submit their applications under the EU Benchmarks Regulation. We are the legal representative to the first successful American index provider to gain authorisation (under the recognition process) as a third country (non-EU) benchmark administrator, and are working with other administrators from around the globe to provide recognition or endorsement of their benchmarks.
* For example, please refer to our page detailing the TP ICAP benchmarks., which we administer on behalf of TP ICAP, under the UK benchmarks regulation. We can use the same approach for EU benchmarks, if required.