Benchmarks LIBOR transition FCA existing supervisory powers for critical benchmarks
Under the BMR, the FCA has an existing set of powers that apply where the administrator intends to cease providing a critical benchmark, or where that benchmark is at risk of becoming unrepresentative of the underlying market or economic reality the benchmark is intended to measure.
	Where an administrator of a critical benchmark intends to cease providing the benchmark, the BMR requires the administrator to immediately notify the FCA, and submit an assessment within four weeks as to how the benchmark can either be transitioned to an alternative administrator or cease to be provided. The BMR also requires administrators of all categories of benchmark to publish the actions to be taken by the administrator in the event of changes to, or the cessation of, a benchmark.
	Upon receipt of the assessment, the FCA must make its own assessment of how the critical benchmark is to be transitioned to a new administrator or cease to be provided. Following completion of this assessment, the FCA can compel the administrator to continue to publish the benchmark until it has been transitioned to a new administrator, it can be ceased in an orderly fashion or the benchmark is no longer deemed critical.
	The FCA can compel the administrator to publish the benchmark for an "appropriate period", not exceeding a term of 12 months, which can be extended in further 12 month increments up to a maximum of five years.
	Where a contributor to a critical benchmark intends to withdraw its submissions, the BMR also empowers the FCA to compel mandatory contributions to a critical benchmark, where the majority of contributors to the benchmark are UK supervised entities. If a supervised contributor to a critical benchmark intends to cease its submissions, it must notify the benchmark administrator, which is then required to inform the FCA without delay. The FCA can compel the supervised contributor to continue submitting input data to the benchmark for an initial period of up to four weeks from the date it is notified of the contributor’s intention to withdraw. The benchmark administrator is then required to submit an assessment to the FCA on the capability of the benchmark to measure the underlying market or economic reality it seeks to measure, i.e. its representativeness, within fourteen days of the contributor sharing its intention to withdraw.
	Upon receipt of the administrator’s assessment, the FCA must then make its own assessment of the benchmark’s representativeness. If the FCA considers that the representativeness of a critical benchmark is put at risk, it can compel a supervised entity, (including entities that do not contribute to the relevant benchmark), to contribute input data to the administrator for an appropriate period of time not exceeding 12 months, which be extended in further 12 months increments up to a maximum of five years. It can also require the administrator to change the methodology, code of conduct, or other rules of a critical benchmark in order to restore the representativeness of the benchmark where it assesses the benchmark’s representativeness is "at risk." The BMR requires a benchmark administrator to cease providing an unrepresentative benchmark within "a reasonable time period."
	Benchmark administrators of one or more critical benchmarks are also required to conduct a review of a critical benchmark’s representativeness every two years and submit this assessment to the FCA. Upon receipt of this assessment, the FCA conducts its own biennial assessment of the critical benchmark. Where the FCA determines that the representativeness of the benchmark is at risk, then it has access to the same powers as described in paragraph 260.
	Under Title IV, the BMR also empowers the FCA to suspend or withdraw the authorisation or registration of an administrator under specific circumstances. Where the FCA withdraws or suspends the authorisation of a benchmark administrator, it will update the FCA Benchmarks Register accordingly. UK supervised entities are only permitted to use UK-administered benchmarks in financial contracts or financial instruments, or to measure the performance of an investment fund where that benchmark is listed on the FCA Benchmarks Register, or is provided by an administrator who is listed on the FCA Benchmarks Register and is located in the UK.