European Commission call for evidence on the review of the scope and regime for non-EU Benchmarks

EFAMA has responded to the EC’s call for evidence on the review of the scope and regime for non-EU benchmarks.
In its response, EFAMA expresses support for the EC’s efforts to address the problem areas identified in the Call for Evidence. In particular, EFAMA agrees that only a few non-EU administrators have made the necessary steps to obtain access to the EU market through recognition or endorsement, and that most benchmarks are locally anchored and cannot be easily replaced by an EU benchmark that measures the same market or economy.
EFAMA notes that the current provisions of the BMR third-country regime are not fit for purpose and should be revised to ensure that EU asset managers have access to non-EU benchmarks that are essential for their daily operations. It argues that the BMR framework should be narrowed in scope to capture only those benchmarks that have a significant influence on EU consumers, with only selected „strategic“ third-country benchmarks subject to BMR standards. The usage of other third-country benchmarks would be free, with no additional requirements tied to the administrator’s standing.
EFAMA emphasizes that the “strategic“ benchmark should not be an additional BMR category but should replace the current categories of „significant“ and „non-significant“ benchmarks. It also argues that the new regime should be designed in a way that ensures a level playing field between EU and non-EU benchmarks, avoiding any discrimination against non-EU providers.
EFAMA further stresses that non-EU benchmarks that are labelled as EU Climate Benchmarks and EU Paris-Alignment Benchmarks should be subject to EU supervision of all label-related BMR provisions. This would ensure that the use of these labels by non-EU providers does not create any regulatory arbitrage or market distortion.