The European Union has started to enforce its Benchmarks Regulation (BMR) on January 1, 2018 in order to regulate the provision of, contribution to and use of a wide set of benchmarks. The BMR has been created to:
- Manage conflict of interest inherent to certain investment processes.
- Prevent supervised entities (including asset managers, asset owners and insurance companies) from using unregulated benchmarks in the EU.
- Improve governance and controls over the benchmarks process.
Let’s take a look at the regulation and what you need to know to become compliant.