Australian Financial Markets Association
AFMA
The Australian Financial Markets Association (AFMA) was formed in 1986.
ID: 176528715359-70
Lobbying Activity
Response to Equivalence decision for a third country under the Benchmarks regulation (BMR) [Australia]
15 Apr 2019
Comment on draft text for Decision to implement the equivalence of the legal and supervisory framework applicable to benchmarks in Australia in accordance with Regulation (EU) 2016/1011 of the European Parliament and of the Council.
The Australian Financial Markets Association (AFMA) represents around 115 active participants in wholesale banking and financial markets, including all the Australian banks, all significant global banks and securities companies operating in Australia and many specialised traders in markets. AFMA has been closely involved with benchmark reform and regulation for many years.
Australia represents an important component of the global financial markets and there are many cross-border transactions between our market and those in the EU. Many users in the EU reference the BBSW, S&P/ASX 200 Index, ASX Bond Futures Settlement Price, Australian Interbank Overnight Cash Rate and Australian CPI and would want to continue to do so after 1 January 2022.
The international experience of regulators in developing and implementing cross-border regulations in globalised securities markets has highlighted the challenges they face in ensuring the effectiveness of domestic regulation, without unduly constraining the cross-border offering of financial services or products. It is crucially important to avoid market disruption and allow market users to efficiently access infrastructure when conducting cross-border business to service global economic trade. Benchmarks play an important role in facilitating business. Cross-border jurisdiction recognition and deference between well-regulated comparable regimes is of great importance to industry as it works to maintain living standards.
Australia led the work on global benchmark reform and made a major seminal contribution to the development of the IOSCO Principles for Financial Benchmarks. The Australian authorities then showed leadership in developing Australia’s domestic benchmark regulatory regimes consistent with the IOSCO Principles.
AFMA agrees with the Commission’s assessment of the requirements relating to benchmarks in Australia on which its decision is being based. The assessment takes proper account of the legal framework and supervisory practice of Australia in that it ensures compliance with the IOSCO principles for financial benchmarks, and that such specific administrators or specific benchmarks or families of benchmarks are subject to effective supervision and enforcement on an on-going basis in Australia.
In conclusion, AFMA strongly supports the Commission making the Decision to implement the equivalence of the legal and supervisory framework applicable to benchmarks in Australia in accordance with Regulation (EU) 2016/1011 of the European Parliament and of the Council as set out in the draft text released for consultation to which these comments respond.
David Love
General Counsel & International Adviser
Australian Financial Markets Association
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