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eId="key-23d970c3929c5baa88f62c05a2047512" marker="C1"><p>The “appropriate regulator” has power to make such provision as they consider appropriate by means of an instrument in writing to prevent, remedy or mitigate any failure of the provisions of this Regulation to operate effectively or any other deficiency arising from the withdrawal of the United Kingdom from the EU, see The Financial Regulators’ <ref eId="c7g3i15c5-00005" href="http://www.legislation.gov.uk/id/uksi/2018/1115">Powers (Technical Standards etc.) (Amendment etc.) (EU Exit) Regulations 2018 (S.I. 2018/1115)</ref>, <ref eId="c7g3i15c5-00006" class="subref" href="http://www.legislation.gov.uk/id/uksi/2018/1115/regulation/2">regs. 2</ref>, <ref eId="c7g3i15c5-00007" class="subref" href="http://www.legislation.gov.uk/id/uksi/2018/1115/regulation/3">3</ref>, <ref eId="c7g3i15c5-00008" class="subref" href="http://www.legislation.gov.uk/id/uksi/2018/1115/schedule/part/5">Sch. Pt. 5</ref> (as amended by <ref eId="c7g3i15c5-00009" href="http://www.legislation.gov.uk/id/uksi/2020/628">The Financial Services (Miscellaneous Amendments) (EU Exit) Regulations 2020 (S.I. 2020/628)</ref>, <ref eId="c7g3i15c5-00010" class="subref" href="http://www.legislation.gov.uk/id/uksi/2020/628/regulation/1/2">regs. 1(2)</ref>, <ref eId="c7g3i15c5-00011" class="subref" href="http://www.legislation.gov.uk/id/uksi/2020/628/regulation/5/3">5(3)</ref>) (with saving on IP completion day by <ref eId="c7g3i15c5-00012" href="http://www.legislation.gov.uk/id/uksi/2018/680">S.I. 2018/680</ref>, <ref eId="c7g3i15c5-00013" class="subref" href="http://www.legislation.gov.uk/id/uksi/2018/680/regulation/1/2">regs. 1(2)</ref>, <rref eId="c7g3i15c5-00014" class="subref" from="http://www.legislation.gov.uk/id/uksi/2018/680/regulation/11/2" upTo="http://www.legislation.gov.uk/id/uksi/2018/680/regulation/11/10" ukl:CitationRef="c7g3i15c5-00012">11(2)(4)(8)-(10)</rref>; <ref eId="c7g3i15c5-00015" href="http://www.legislation.gov.uk/id/ukpga/2020/1">2020 c. 1</ref>, <ref eId="c7g3i15c5-00016" class="subref" href="http://www.legislation.gov.uk/id/ukpga/2020/1/schedule/5/paragraph/1/1">Sch. 5 para. 1(1)</ref>)</p></note><note ukl:Name="Commentary" ukl:Type="C" class="commentary C" eId="key-6f2d1e3fbfd69e455c7ecd495458cff4" marker="C2"><p>Regulation: power to modify conferred (11.7.2023) by <ref eId="c7hjcpcf5-00007" href="http://www.legislation.gov.uk/id/ukpga/2023/29">Financial Services and Markets Act 2023 (c. 29)</ref>, <ref eId="c7hjcpcf5-00008" class="subref" href="http://www.legislation.gov.uk/id/ukpga/2023/29/section/3">ss. 3</ref>, <ref eId="c7hjcpcf5-00009" class="subref" href="http://www.legislation.gov.uk/id/ukpga/2023/29/section/86/3">86(3)</ref>, <ref eId="c7hjcpcf5-00010" class="subref" href="http://www.legislation.gov.uk/id/ukpga/2023/29/schedule/1/part/1">Sch. 1 Pts. 1</ref>, <ref eId="c7hjcpcf5-00011" class="subref operative" href="http://www.legislation.gov.uk/id/ukpga/2023/29/schedule/1/part/3">3</ref>; <ref eId="c7hjcpcf5-00012" href="http://www.legislation.gov.uk/id/uksi/2023/779">S.I. 2023/779</ref>, <ref eId="c7hjcpcf5-00013" class="subref" href="http://www.legislation.gov.uk/id/uksi/2023/779/regulation/2/d">reg. 2(d)</ref></p></note></notes><proprietary xmlns:ukm="http://www.legislation.gov.uk/namespaces/metadata" xmlns:dc="http://purl.org/dc/elements/1.1/" xmlns:dct="http://purl.org/dc/terms/" source="#"><dc:identifier>http://www.legislation.gov.uk/eur/2016/2021</dc:identifier><dc:title>Commission Delegated Regulation (EU) 2016/2021 of 2 June 2016 supplementing Regulation (EU) No 600/2014 of the European Parliament and of the Council on markets in financial instruments with regard to regulatory technical standards on access in respect of benchmarks (Text with EEA relevance)</dc:title><dct:alternative>Commission Delegated Regulation (EU) 2016/2021</dct:alternative><dc:description>Commission Delegated 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Size="341554"/></ukm:Alternatives><ukm:Statistics><ukm:TotalParagraphs Value="6"/><ukm:BodyParagraphs Value="6"/><ukm:ScheduleParagraphs Value="0"/><ukm:AttachmentParagraphs Value="0"/><ukm:TotalImages Value="0"/></ukm:Statistics></proprietary></meta><preface eId="preface"><longTitle><p><inline name="uppercase">Commission Delegated Regulation</inline> (EU) 2016/2021</p><p>of 2 June 2016</p><p>supplementing Regulation (EU) No 600/2014 of the European Parliament and of the Council on markets in financial instruments with regard to regulatory technical standards on access in respect of benchmarks</p><p>(Text with EEA relevance)</p></longTitle></preface><preamble><p>THE EUROPEAN COMMISSION,</p><p>Having regard to the Treaty on the Functioning of the European Union,</p><p>Having regard to 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<authorialNote class="footnote" eId="f00001" marker="1"><p>
                  <ref eId="c00001" href="https://webarchive.nationalarchives.gov.uk/eu-exit/https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.L_.2014.173.01.0084.01.ENG">OJ L 173, 12.6.2014, p. 84</ref>.</p></authorialNote>, and in particular the third subparagraph of Article 37(4) thereof,</p><p>Whereas:</p><blockContainer class="division" uk:name="division"><num>(1)</num><p>Regulation (EU) No 600/2014 provides for the non-discriminatory access for clearing and trading between central counterparties (CCPs) and trading venues, including access to licences of and information relating to benchmarks which are used to determine the value of some financial instruments for trading and clearing purposes. Given the variety of benchmarks, the information CCPs and trading venues need for clearing or trading purposes may vary depending on a number of factors, including the relevant financial instrument being traded or cleared and the type of benchmark that the financial instrument references. Therefore, CCPs and trading venues should be allowed to request access to any information, provided it is required for clearing or trading purposes.</p></blockContainer><blockContainer class="division" uk:name="division"><num>(2)</num><p>The diversity of benchmarks and the different uses identified render a one size fits all approach inappropriate and a high degree of harmonisation on the content of licence agreements unsuitable. Limiting the conditions under which access is granted on predetermined and exhaustive terms might therefore be detrimental to all parties.</p></blockContainer><blockContainer class="division" uk:name="division"><num>(3)</num><p>A person with proprietary rights to a benchmark should be able to set different conditions for different categories of CCPs and trading venues to access its benchmark only where objectively justified, such as in terms of the quantity, scope or field of use demanded and applied in a proportionate manner. The different categories and the criteria defining the various categories of CCPs and trading venues should be made publicly available.</p></blockContainer><blockContainer class="division" uk:name="division"><num>(4)</num><p>The way a benchmark is assessed as new or not will vary on a case by case basis. The person with proprietary rights to a benchmark should therefore demonstrate in what way that benchmark is new, if that is invoked as the reason for denying immediate access. Each assessment of a declared new benchmark should consider a combination of various factors and their appropriate weightings and not rely on a single factor to assess whether or not the benchmark meets the criteria specified in Regulation (EU) No 600/2014.</p></blockContainer><blockContainer class="division" uk:name="division"><num>(5)</num><p>Although the values of two benchmarks could be highly correlated, particularly in the short run, their compositions or methodology could be fundamentally different. The long run correlation and similarities in the composition and the methodology of each of the benchmarks should therefore be taken into account for assessing whether a benchmark is new. Considering the heterogeneity of benchmarks, in addition to the factors laid down in this Regulation, a person with proprietary rights to a benchmark should also take into account additional factors, considering standards in use, that are specific to the type of benchmark concerned. For commodity benchmarks other factors should be assessed, including whether the relevant benchmarks are based on different underlying commodities and different delivery locations.</p></blockContainer><blockContainer class="division" uk:name="division"><num>(6)</num><p>New series of benchmarks are released on a periodic basis, such as credit default swaps benchmarks. In those cases, the newly released benchmark is a continuation of the previous series and should therefore not be considered a new benchmark.</p></blockContainer><blockContainer class="division" uk:name="division"><num>(7)</num><p>For reasons of consistency and in order to ensure the smooth functioning of the financial markets, it is necessary that the provisions laid down in this Regulation and the provisions laid down in Regulation (EU) No 600/2014 apply from the same date.</p></blockContainer><blockContainer class="division" uk:name="division"><num>(8)</num><p>This Regulation is based on the draft regulatory technical standards submitted by the European Securities and Markets Authority (ESMA) to the Commission.</p></blockContainer><blockContainer class="division" uk:name="division"><num>(9)</num><p>ESMA has conducted open public consultations on the draft regulatory technical standards on which this Regulation is based, analysed the potential related costs and benefits and requested the opinion of the Securities and Markets Stakeholder Group established by Article 37 of Regulation (EU) No 1095/2010 of the European Parliament and of the Council<authorialNote class="footnote" eId="f00002" marker="2"><p>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 (<ref eId="c00002" href="https://webarchive.nationalarchives.gov.uk/eu-exit/https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.L_.2010.331.01.0084.01.ENG">OJ L 331, 15.12.2010, p. 84</ref>).</p></authorialNote>,</p></blockContainer><p>HAS ADOPTED THIS REGULATION:</p></preamble><body eId="body"><article eId="article-1"><num>Article 1</num><heading>Information to be made available to CCPs and trading venues</heading><paragraph eId="article-1-1"><num>1.</num><content><p>A person with proprietary rights to a benchmark shall, upon request, make available to central counterparties (CCPs) and trading venues the information necessary for performing their clearing or trading functions, as appropriate to the specific type of benchmark to which access is sought and to the relevant financial instrument to be traded or cleared.</p></content></paragraph><paragraph eId="article-1-2"><num>2.</num><content><p>A CCP or trading venue shall in its request explain why such information is required for clearing or trading purposes.</p></content></paragraph><paragraph eId="article-1-3"><num>3.</num><intro><p>For the purposes of paragraph 1, relevant trading and clearing functions shall at least include the following:</p></intro><level class="para1"><num>(a)</num><content><p>for a trading venue:</p><blockList class="ordered roman parens" ukl:Name="OrderedList" ukl:Type="roman" ukl:Decoration="parens"><item><num>(i)</num><p>the initial assessment of the characteristics of the benchmark;</p></item><item><num>(ii)</num><p>the marketing of the relevant product;</p></item><item><num>(iii)</num><p>the support of the price formation process for the contracts admitted or being admitted to trading;</p></item><item><num>(iv)</num><p>the on-going market surveillance activities;</p></item></blockList></content></level><level class="para1"><num>(b)</num><content><p>for a CCP:</p><blockList class="ordered roman parens" ukl:Name="OrderedList" ukl:Type="roman" ukl:Decoration="parens"><item><num>(i)</num><p>appropriate risk management of relevant open positions in exchange-traded derivatives, including netting;</p></item><item><num>(ii)</num><p>compliance with relevant obligations set out in Regulation (EU) No 648/2012 of the European Parliament and of the Council<authorialNote class="footnote" eId="f00003" marker="3"><p>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 (<ref eId="c00003" href="https://webarchive.nationalarchives.gov.uk/eu-exit/https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.L_.2012.201.01.0001.01.ENG">OJ L 201, 27.7.2012, p. 1</ref>).</p></authorialNote>.</p></item></blockList></content></level></paragraph><paragraph eId="article-1-4"><num>4.</num><intro><p>Relevant information in respect of price and data feeds referred to in Article 37(1)(a) of Regulation (EU) No 600/2014 shall at least include:</p></intro><level class="para1"><num>(a)</num><content><p>a feed of the benchmark's values;</p></content></level><level class="para1"><num>(b)</num><content><p>prompt notification of any inaccuracy in the calculation of the benchmark values and of the updated or corrected benchmark values;</p></content></level><level class="para1"><num>(c)</num><content><p>historical benchmark values where the person with proprietary rights to the benchmark maintains such information.</p></content></level></paragraph><paragraph eId="article-1-5"><num>5.</num><intro><p>In respect of composition, methodology and pricing, the information provided shall allow CCPs and trading venues to understand how each benchmark value is created, and the actual methodology used to make the benchmark values. Relevant information in respect of composition, methodology and pricing shall at least include:</p></intro><level class="para1"><num>(a)</num><content><p>the definitions for all key terms used in relation to the benchmark;</p></content></level><level class="para1"><num>(b)</num><content><p>the rationale for adopting a methodology and procedures for the review and approval of the methodology;</p></content></level><level class="para1"><num>(c)</num><content><p>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 use of any models or methods of extrapolation and any procedure for rebalancing the constituents of a benchmark;</p></content></level><level class="para1"><num>(d)</num><content><p>the controls and rules that govern any exercise of discretion or judgement, to ensure consistency in the use of such discretion or judgment;</p></content></level><level class="para1"><num>(e)</num><content><p>the procedures which govern benchmark determination 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;</p></content></level><level class="para1"><num>(f)</num><content><p>the hours during which the benchmark is calculated;</p></content></level><level class="para1"><num>(g)</num><content><p>the procedures which govern the benchmark's rebalancing methodology and the resulting weightings of the constituents of the benchmark;</p></content></level><level class="para1"><num>(h)</num><content><p>the procedures for dealing with errors in input data, or the benchmark determination, including when a re-determination of the benchmark may be required;</p></content></level><level class="para1"><num>(i)</num><content><p>information regarding the frequency for any internal reviews and approvals of the composition and methodology and, where applicable, information regarding the procedures and frequency for external review of the composition and methodology.</p></content></level></paragraph></article><article eId="article-2"><num>Article 2</num><heading>General conditions for the information through licensing to be provided to CCPs and trading venues</heading><paragraph eId="article-2-1"><num>1.</num><content><p>A person with proprietary rights to a benchmark shall make available all relevant information referred to in Article 1 requested by CCPs and trading venues through licensing without undue delay, either on a one-off basis, including amendments to previously provided information, or on a continuous or periodic basis, depending on the type of information concerned.</p></content></paragraph><paragraph eId="article-2-2"><num>2.</num><content><p>A person with proprietary rights to a benchmark shall provide all relevant information referred to in Article 1 to all CCPs and trading venues through licensing on the same timescales and under the same conditions, unless different conditions can be objectively justified.</p></content></paragraph><paragraph eId="article-2-3"><num>3.</num><content><p>The requirements in paragraphs 1 and 2 do not apply if, and for as long as, a person with proprietary rights to a benchmark can demonstrate that certain information is available publicly or through other commercial means to CCPs and trading venues, if such information is reliable and timely.</p></content></paragraph></article><article eId="article-3"><num>Article 3</num><heading>Differentiation and non-discrimination</heading><paragraph eId="article-3-1"><num>1.</num><content><p>Where a person with proprietary rights to a benchmark sets, in accordance with Article 37(1) of Regulation (EU) No 600/2014, different conditions, including fees and their payment conditions, those conditions shall apply in a manner specific to each category of licensees.</p></content></paragraph><paragraph eId="article-3-2"><num>2.</num><content><p>A person with proprietary rights to a benchmark shall set the same rights and obligations for the licensees within the same category.</p></content></paragraph><paragraph eId="article-3-3"><num>3.</num><content><p>A person with proprietary rights to a benchmark shall make the criteria defining the different categories of licensees publicly available.</p></content></paragraph><paragraph eId="article-3-4"><num>4.</num><content><p>A person with proprietary rights to a benchmark shall, on request, provide to any CCP or trading venue for free the conditions applying to the category to which that CCP or trading venue belongs.</p></content></paragraph><paragraph eId="article-3-5"><num>5.</num><content><p>A person with proprietary rights to a benchmark shall make available to all licensees within the same category any additions to or modifications of the conditions for licensing agreements agreed with a licensee within that category under the same conditions.</p></content></paragraph></article><article eId="article-4"><num>Article 4</num><heading>Other conditions under which access is granted</heading><paragraph eId="article-4-1"><num>1.</num><intro><p>A person with proprietary rights to a benchmark shall set the conditions for licensing agreements and make them available to CCPs and trading venues upon request free of charge. The conditions shall include the following:</p></intro><level class="para1"><num>(a)</num><content><p>the scope of use and content of information for each use under the licensing agreements, clearly identifying in each case confidential information;</p></content></level><level class="para1"><num>(b)</num><content><p>the conditions for redistribution, if allowed, of information by CCPs and trading venues;</p></content></level><level class="para1"><num>(c)</num><content><p>the technical requirements for the delivery of the service;</p></content></level><level class="para1"><num>(d)</num><content><p>the fees and the conditions for paying them;</p></content></level><level class="para1"><num>(e)</num><content><p>the conditions under which the agreement expires taking into consideration the lifespan of financial instruments that reference the benchmark;</p></content></level><level class="para1"><num>(f)</num><content><p>the contingency circumstances and the relevant measures to regulate the continuation, transitional periods and interruption of the service during a contingency period, which:</p><blockList class="ordered roman parens" ukl:Name="OrderedList" ukl:Type="roman" ukl:Decoration="parens"><item><num>(i)</num><p>allow for termination in an orderly manner;</p></item><item><num>(ii)</num><p>ensure that termination is not triggered by minor breaches of the contract and that the relevant party is given a reasonable amount of time to remedy any breach that does not give rise to immediate termination;</p></item></blockList></content></level><level class="para1"><num>(g)</num><content><p>the governing law and allocation of liabilities.</p></content></level></paragraph><paragraph eId="article-4-2"><num>2.</num><intro><p>The licensing agreement shall require that CCPs, trading venues and persons with proprietary rights to a benchmark establish adequate policies, procedures and systems to ensure the following:</p></intro><level class="para1"><num>(a)</num><content><p>implementation of the service without undue delay according to a prearranged schedule;</p></content></level><level class="para1"><num>(b)</num><content><p>keeping up to date all information provided by the parties throughout the duration of the access arrangement, including information that could have a reputational impact;</p></content></level><level class="para1"><num>(c)</num><content><p>a communication channel between the parties that is timely, reliable and secure during the lifetime of the licence agreement;</p></content></level><level class="para1"><num>(d)</num><content><p>consultation where any change to either entity's operations is likely to have a material impact on the licence agreement or on the risks to which the other entity is exposed and notification within a reasonable notice period before any change to either entity's operation is implemented;</p></content></level><level class="para1"><num>(e)</num><content><p>the provision of information and the relevant instructions to transmit and use it through the technical means agreed;</p></content></level><level class="para1"><num>(f)</num><content><p>the provision of up-to-date information to persons with proprietary rights to a benchmark regarding the redistribution, if allowed, of information to clearing members of CCPs and members or participants of trading venues;</p></content></level><level class="para1"><num>(g)</num><content><p>resolution of disputes and termination of the agreement occurs in an orderly manner according to the identified circumstances.</p></content></level></paragraph></article><article eId="article-5"><num>Article 5</num><heading>Standards guiding how a benchmark may be proven to be new</heading><paragraph eId="article-5-1"><num>1.</num><intro><p>When establishing whether a new benchmark meets the criteria set out in points (a) and (b) of Article 37(2) of Regulation (EU) No 600/2014, a person with proprietary rights to a benchmark shall take the following standards into account:</p></intro><level class="para1"><num>(a)</num><content><p>whether contracts based on the more recent benchmark are not capable of being netted nor substantially offset with contracts based on the relevant existing benchmark by a CCP;</p></content></level><level class="para1"><num>(b)</num><content><p>whether the regions and industry sectors covered by the relevant benchmarks are not the same, nor similar;</p></content></level><level class="para1"><num>(c)</num><content><p>whether the values of the relevant benchmarks are not highly correlated;</p></content></level><level class="para1"><num>(d)</num><content><p>whether composition of the relevant benchmarks, having regard to the number of constituents, the actual constituents, their values and their weightings are not the same, nor similar;</p></content></level><level class="para1"><num>(e)</num><content><p>whether the methodologies of each relevant benchmark are not the same, nor similar.</p></content></level></paragraph><paragraph eId="article-5-2"><num>2.</num><intro><p>For commodity benchmarks, in addition to the standards specified in paragraph 1, the following additional standards shall be taken into account:</p></intro><level class="para1"><num>(a)</num><content><p>whether the relevant benchmarks are not based on the same underlying commodities;</p></content></level><level class="para1"><num>(b)</num><content><p>whether the delivery locations of the underlying commodities are not the same.</p></content></level></paragraph><paragraph eId="article-5-3"><num>3.</num><content><p>In addition to the standards specified in paragraphs 1 and 2, a person with proprietary rights to a benchmark shall take into account further standards in use specific to the types of benchmarks being assessed, as appropriate.</p></content></paragraph><paragraph eId="article-5-4"><num>4.</num><content><p>A newly released series of a benchmark shall not constitute a new benchmark.</p></content></paragraph></article><article eId="article-6"><num>Article 6</num><heading>Entry into force and application</heading><content><p>This Regulation shall enter into force on the twentieth day following that of its publication in the <i>Official Journal of the European Union</i>.</p><p>It shall apply from the date referred to in the fourth paragraph of Article 55 of Regulation (EU) No 600/2014.</p></content></article><hcontainer name="signatures"><intro><p>This Regulation shall be binding in its entirety and directly applicable in all Member States.</p></intro><hcontainer name="signatureBlock"><content><p>Done at Brussels, 2 June 2016.</p><p>
                        <i>For the Commission</i>
                     </p><p>
                        <i>The President</i>
                     </p><p>Jean-Claude <inline name="uppercase">Juncker</inline>
                     </p></content></hcontainer></hcontainer></body></act></akomaNtoso>