EU presidency to revisit benchmarks legislation

The incoming six-month Italian presidency of the EU aims to achieve agreement between member states on benchmark regulation by the end of this year.

It has scheduled a first meeting in the week of 14 July with the working groups on the benchmarks regulation, composed of member state experts.

Ahead of that, on 7 July, newly elected members of the European Parliament’s economic and monetary affairs committee will meet to elect a chairperson and then select a draftsperson to draw up amendments to the benchmarks regulation, which was proposed by the European Commission on 18 September.

Key among the decisions to be taken by the committee is whether energy and other commodity benchmarks will come within the scope of the legislation, which sets rules for the use and provision of financial benchmarks used as indexes, such as Libor and Euribor.

The previous committee failed to agree on whether commodity benchmarks should be included in the regulation. Former chairperson Sharon Bowles was unable to achieve a compromise on amendments to the regulation. She pointed to scope, and the inclusion of energy and other commodities, as a “major” issue preventing agreement. UK MEP Bowles did not seek re-election in May’s European parliamentary polls.

The parliament’s energy committee had called for provisional exemption of commodity benchmarks if compliant with the principles for oil price reporting agencies laid out by international regulators group Iosco in October 2012.

Indications so far are that member states in the EU Council have not made much progress following meetings in March, May and early June. Germany has yet to adopt a clear position and is waiting for clarification of the exact scope of the benchmarks proposal.

France still maintains that all commodities, including energy, must be included in the scope of the benchmarks regulation, although it has conceded that commodities might be handled slightly differently. France wants EU financial regulator Esma to control and monitor the legislation.

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