Regulation (EU) 2016/1011 of the European Parliament and of the Council of 8 June 2016 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds and amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) No 596/2014 (Text with EEA relevance)

Changes over time for: Article 51

Version Superseded: 01/01/2024

Alternative versions:

08/06/2016- Amendment
10/12/2019- Amendment
Exit day: start of implementation period31/01/2020 11pm- Amendment
End of implementation period31/12/2020- Amendment
01/07/2021- Amendment
01/07/2021
Point in time
01/01/2024- Amendment

Status:

Point in time view as at 01/07/2021. This version of this provision has been superseded.

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Changes to legislation:

Regulation (EU) 2016/1011 of the European Parliament and of the Council, Article 51 is up to date with all changes known to be in force on or before 22 January 2025. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations.

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Article 51U.K.Transitional provisions

[F11.An index provider providing a benchmark to which paragraph 1A applies must have applied to the FCA for authorisation or registration in accordance with Article 34 of the EU Benchmarks Regulation on or before 31 December 2019, in order to provide a benchmark that may be used in the United Kingdom on or after 1 January 2020.

1A.A supervised entity may, subject to paragraphs 1B and 1C, use a benchmark in the United Kingdom that:

(a)is provided by a UK index provider who was providing a benchmark in the United Kingdom on 30 June 2016, or

(b)is a benchmark (to which paragraph (a) does not apply) that was provided by a UK index provider in the United Kingdom in the period beginning with 1 July 2016 and ending with 31 December 2017,

1B.A supervised entity may not use a benchmark under paragraph 1A if:

(a) before 1 January 2020, the index provider providing the benchmark made an application to the FCA for authorisation or registration under Article 34 of the EU Benchmarks Regulation; and

(b)the index provider is notified that the application is refused or approved.

1C.Where the UK index provider is notified that the application is refused or approved on or after IP completion day, the benchmark may not be used under paragraph 1A:

(a)where the application is refused, from the day after the date on which the index provider is notified of the refusal;

(b)where the application is approved, from the day on which the index provider is recorded on the FCA register.]

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F33.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4.Where [F4a benchmark provided by a UK index provider] does not meet the requirements of this Regulation, but ceasing or changing that benchmark to fulfil the requirements of this Regulation would result in a force majeure event, frustrate or otherwise breach the terms of any financial contract or financial instrument or the rules of any investment fund, which references that benchmark, [F5the FCA shall permit the use of the benchmark in the United Kingdom]. No financial instruments, financial contracts, or measurements of the performance of an investment fund shall add a reference to such [F6a benchmark] after 1 January 2020.

[F74a.An index provider may continue to provide an existing benchmark that has been recognised as a critical benchmark by [F8regulations made by the Treasury under Article 20(5)] until 31 December 2021 or, where the index provider submits an application for authorisation in accordance with paragraph 1, unless and until such authorisation is refused.

4b.An existing benchmark that has been recognised as a critical benchmark by [F9regulations made by the Treasury under Article 20(5)] may be used for existing and new financial instruments, financial contracts, or for measuring the performance of an investment fund until 31 December 2021 or, where the index provider submits an application for authorisation in accordance with paragraph 1, unless and until such authorisation is refused.]

[F105.A supervised entity may use a benchmark provided by an administrator located in a third country as a reference for a financial instrument, a financial contract or for measuring the performance of an investment fund in the United Kingdom:

(a)during the period beginning with IP completion day and ending with [F1131 December 2025];

(b)on and after [F121 January 2026], if the benchmark is used as a reference for that financial instrument, that financial contract or for measuring the performance of that investment fund on [F1331 December 2025],

(but see paragraph 5A).

5A.A benchmark may not be used under paragraph 5 if:

(a)before IP completion day:

(i)the administrator providing the benchmark makes an application for registration or authorisation under Article 34 of the EU Benchmarks Regulation; and

(ii)the administrator is notified that the application is refused;

(b)the benchmark, or the administrator providing the benchmark, is recorded on the FCA register in accordance with Article 36 of this Regulation.

5B.A benchmark that:

(a)is provided by an administrator to whom paragraph 5A(a) applies, and

(b)is used as a reference for a financial instrument, a financial contract or for measuring the performance of an investment fund in the United Kingdom before the administrator is notified the application is refused,

may continue to be used in the United Kingdom as a reference for that financial instrument, that financial contract or for measuring the performance of that investment fund.]

6.The [F14Treasury may make regulations to specify] the conditions on which the [F15FCA] may assess whether the cessation or the changing of [F16a benchmark provided by a UK index provider] to conform with the requirements of this Regulation could reasonably result in a force majeure event, frustrate or otherwise breach the terms of any financial contract or financial instrument or the rules of any investment fund which references such benchmark.

[F177.In this Article: