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1Scan for outdated or missing drivers - takes under a minute2Repair Windows errors before they cause bigger problems3Fix the driver behind crashes, sound loss and screen glitchesOn 9 October 2019, the European Securities and Markets Authority (ESMA) and the Australian Securities and Investments Commission (ASIC) signed a memorandum of understanding covering financial benchmarks. The agreement created a framework for supervisory cooperation and information sharing under Article 30 of the EU Benchmarks Regulation (BMR).
It did not, by itself, declare Australian benchmarks equivalent to EU rules or give every Australian index and interest rate automatic access to the European market. That legal step had already been taken by the European Commission in July 2019.
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What ESMA and ASIC actually signed
The official document is titled “Memorandum of Understanding between ESMA and ASIC establishing cooperation arrangements under Article 30 of Regulation (EU) 2016/1011.” It was signed by ASIC Chair James Shipton and ESMA Chair Steven Maijoor.
ESMA announced the agreement on 20 October 2019, followed by ASIC on 21 October 2019. The arrangement applies to cooperation involving Australian benchmark administrators and specified benchmarks covered by the EU’s equivalence decision.
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In practical terms, the MoU gives the two regulators a process for working together when a benchmark is used, administered or supervised across the two jurisdictions. It covers:
- exchanging supervisory information;
- notifying the other authority about relevant regulatory breaches;
- coordinating supervisory activities;
- cooperating on inspections, including on-site inspections where appropriate; and
- protecting the confidentiality of information and requests.
Both authorities agreed to provide the fullest cooperation permitted by their respective laws and regulations.
Why the agreement was necessary
The EU Benchmarks Regulation sets conditions for benchmarks produced outside the European Union but used by EU-regulated firms. One route is an equivalence decision: the European Commission assesses whether the third country’s legal and supervisory framework is equivalent to the EU framework.
On 29 July 2019, the Commission adopted Implementing Decision (EU) 2019/1274. It found Australia’s legal and supervisory framework equivalent for specified significant benchmarks and subject to effective ongoing supervision and enforcement.
Article 30 of the BMR also requires an appropriate cooperation arrangement with the relevant third-country regulator after an equivalence decision. The ESMA–ASIC MoU supplied that cooperation mechanism.
This distinction matters:
| Event | What it did |
|---|---|
| 29 July 2019: European Commission equivalence decision | Found the relevant Australian framework equivalent to the EU framework for specified benchmarks. |
| 9 October 2019: ESMA–ASIC MoU signed | Created the information-sharing and supervisory-cooperation arrangements required under the BMR. |
The MoU did not create the equivalence finding. It implemented the cooperation part of the regulatory framework.
Which Australian benchmarks were covered?
The Commission’s decision concerned benchmarks declared significant under the Australian ASIC Corporations (Significant Financial Benchmarks) Instrument 2018/420. The five benchmarks are:
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| Benchmark | What it broadly measures |
|---|---|
| Australian Bank Bill Swap Rate (BBSW) | An Australian short-term interest-rate benchmark used in financial contracts and products. |
| S&P/ASX 200 Index | A major share-market index tracking large Australian-listed companies. |
| ASX Bond Futures Settlement Price | A settlement reference used for ASX bond futures. |
| Australian Interbank Overnight Cash Rate | A reference for overnight interbank funding conditions. |
| Australian Consumer Price Index | A measure of consumer-price changes used as an inflation reference. |
The names in the 2019 announcements are shortened in places—for example, “Cash Rate” and “CPI”—but they refer to the same five benchmarks.
Who administers these benchmarks in Australia?
The five-benchmark list should not be mistaken for a list of five separately licensed administrators. ASIC’s current financial-benchmarks information identifies:
- ASX Benchmarks Pty Limited as a licensed administrator of the Australian Bank Bill Swap Rate;
- S&P Dow Jones Indices LLC as a licensed administrator of the S&P/ASX 200 Index;
- ASX Clear (Futures) Pty Ltd as an exempt benchmark administrator;
- the Reserve Bank of Australia as an exempt benchmark administrator; and
- the Australian Bureau of Statistics as an exempt benchmark administrator.
ASIC states that the Reserve Bank and the Australian Bureau of Statistics may rely on section 5A(4) of the Corporations Act and therefore do not require benchmark-administrator licences in the same way as the licensed administrators.
What the arrangement means for EU-regulated firms
The equivalence decision enabled the specified Australian significant benchmarks to be used in the European Union by EU-supervised entities through the BMR’s equivalence route.
For a bank, investment firm, fund manager or other regulated business, the practical benefit is that it can refer to an eligible Australian benchmark without requiring the administrator to go through a separate EU recognition or endorsement route—provided the benchmark remains covered by the applicable legal framework and registration requirements.
That does not mean an EU firm can use any Australian index or rate simply because it is published by an Australian organisation. Firms still need to check:
- whether the benchmark is within the BMR’s scope;
- whether the relevant administrator and benchmark have the required status;
- whether the benchmark appears in the applicable ESMA register; and
- whether the firm’s own product, contract or risk policies impose additional conditions.
For an ordinary consumer, the agreement is unlikely to change a bank account or investment product directly. Its effects are more likely to appear indirectly through the continued availability of Australian interest-rate, equity, bond and inflation references in regulated financial products and contracts.
The arrangement is not a licence
The MoU is a regulator-to-regulator agreement. It does not:
- grant an ASIC licence;
- authorise ESMA-regulated activities;
- approve every Australian benchmark;
- guarantee that a benchmark will remain available indefinitely; or
- replace the compliance obligations of a benchmark administrator or financial firm.
It gives ESMA and ASIC a channel for sharing information and coordinating oversight. Licensing, authorisation, benchmark methodology and market-use requirements continue to come from the relevant legislation and regulatory decisions.
Changes since the 2019 announcement
The original announcement should be read alongside later changes to the BMR’s third-country regime.
ESMA’s role expanded from 1 January 2026
ESMA states that, from 1 January 2026, it became the single entry point for third-country benchmark administrators. It is also responsible for supervising recognised third-country benchmarks and EU administrators endorsing third-country benchmarks.
The BMR now has a narrower scope
From the same date, the amended BMR covers only certain categories, including:
- critical benchmarks;
- significant benchmarks;
- EU Climate Transition Benchmarks;
- EU Paris-aligned Benchmarks; and
- certain commodity benchmarks covered by Annex II.
This is narrower than the earlier regime. Whether a particular Australian benchmark is subject to the BMR therefore depends not only on its country of origin, but also on its category and significance.
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Administrators that were included in the Article 36 register on 31 December 2025 as authorised, registered, recognised or endorsing administrators retain that status under the transitional provisions until 30 September 2026.
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The often-repeated reference to 31 December 2023 is not a complete description of the current position. Article 51 contains provisions concerning third-country benchmarks already referenced in instruments, contracts or fund-performance measurements before that date, but later amendments and Australia’s equivalence decision also need to be considered.
What the MoU does not say
Several descriptions of the agreement are misleading:
| Claim | More accurate position |
|---|---|
| “The MoU made Australian benchmarks equivalent.” | The European Commission made the equivalence decision. The MoU established supervisory cooperation required under Article 30. |
| “All Australian benchmarks can now be used in Europe.” | The decision covered specified significant benchmarks. Other benchmarks must meet the applicable BMR route and register requirements if they remain in scope. |
| “The MoU is a licensing agreement.” | It is an information-sharing and supervisory-cooperation arrangement. |
| “Australian origin means there are no EU compliance requirements.” | EU firms must still comply with the BMR’s scope, access routes and register requirements. |
| “A later ESMA–ASIC–RBA MoU amended the benchmark agreement.” | The 9 February 2022 ESMA–ASIC–RBA MoU concerns Australian central counterparties under EMIR, not the 2019 benchmark arrangement. |
Why benchmark oversight matters
Benchmarks are reference numbers used to calculate or determine payments, valuations and performance. A rate such as BBSW can affect the pricing of loans, bonds and derivatives. An index such as the S&P/ASX 200 can be used to track investment performance or set the value of an index-linked product. Inflation measures can affect contracts and investment calculations.
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Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.FAQ
When did ESMA and ASIC sign the benchmarking agreement?
They signed the memorandum of understanding on 9 October 2019. ESMA announced it on 20 October and ASIC issued its matching release on 21 October 2019.
Did the ESMA–ASIC MoU make Australia’s benchmark rules equivalent to EU rules?
No. The European Commission adopted the equivalence decision on 29 July 2019. The MoU established the supervisory cooperation and information-sharing arrangements required after that decision.
Which Australian benchmarks were covered?
The covered list comprised BBSW, the S&P/ASX 200 Index, the ASX Bond Futures Settlement Price, the Australian Interbank Overnight Cash Rate and the Australian Consumer Price Index.
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Does the MoU allow every Australian benchmark to be used in the EU?
No. It applied in connection with the specified benchmarks and did not create a blanket approval for every Australian index, rate or other benchmark. Current use also depends on the BMR’s scope and applicable ESMA-register requirements.
Is the ESMA–ASIC agreement a licence for benchmark administrators?
No. It is a regulator-to-regulator cooperation agreement. It does not grant an Australian licence, an ESMA authorisation or permission to operate outside the applicable regulatory regime.
Does the 2022 ESMA–ASIC–RBA agreement replace the benchmark MoU?
No. The agreement signed on 9 February 2022 concerns Australian central counterparties under EMIR. It is separate from the 2019 ESMA–ASIC arrangement on benchmarks.
The Bottom Line
The 2019 ESMA–ASIC agreement was the operational part of Australia’s access to the EU benchmark framework, not the equivalence decision itself. It allows the regulators to exchange information, coordinate supervision and respond to possible breaches involving specified Australian benchmarks. The Commission’s equivalence decision remains in force, but the EU rules have since changed: ESMA now has a central role for third-country benchmarks, the BMR has a narrower scope, and transitional register arrangements run to 30 September 2026.
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For anyone assessing an Australian benchmark for an EU-regulated product or contract, the key question is not simply whether ASIC is involved. It is whether the particular benchmark and administrator satisfy the current BMR route and appear with the necessary status in the ESMA register.
Sources: ESMA announcement, ASIC release, signed MoU, Commission Implementing Decision (EU) 2019/1274, and ESMA benchmark administrator guidance.
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