ESMA and ASIC have signed an arrangements on benchmarking

October 22, 2019 at 06:30 PM

The European Securities and Markets Authority (ESMA) and the Australian Securities and Investments Commission (ASIC) have announced that they have signed a Memorandum of Understanding (MoU) setting out cooperation arrangements in respect of Australian benchmarks.

The EU Benchmarks Regulation (BMR) prescribes a European common framework to ensure the integrity and accuracy of benchmarks used in the EU. 

The MoU sets out appropriate cooperation arrangements to complement the EU’s equivalence decision, as well as to ensure effective information exchange and supervisory coordination. Under it, both authorities agree to provide each other with the fullest cooperation permissible under their laws and regulations in relation to all relevant information and supervisory activities regarding the covered benchmarks. 

This decision will allow benchmarks declared significant by ASIC (BBSW, S&P/ASX200, Bond Futures Settlement Price, CPI, and Cash Rate) to be used in the EU by EU-supervised entities. 

Commenting on the MoU, James Shipton, the Chair of ASIC said: “Enhancing and improving regulatory cooperation with our international counterparts is a priority for ASIC. We are very pleased to announce this agreement and look forward to our cooperation with ESMA in the future.”

Steven Maijoor, ESMA Chair, said: “The use of financial benchmarks in global capital markets is important for market participants and their accuracy and reliability needs to be ensured at all times. In order to help regulators achieving these objectives, I am pleased that the ESMA-ASIC Memorandum of Understanding will support European regulators and ASIC to work together on a sound legal basis.”

ASIC is Australia’s integrated corporate entity that regulates , markets, financial services and consumer credits. ASIC is an independent Commonwealth Government body. Its vision is for a fair, strong and efficient financial system for all Australians. You can check our detailed article about the pros of dealing with ASIC-regulated brokers.

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