Commission Delegated Regulation (EU) 2021/1350 of 6 May 2021 supplementing Regulation (EU) 2016/1011 of the European Parliament and of the Council with regard to regulatory technical standards specifying the requirements to ensure that an administrator’s governance arrangements are sufficiently robust (Text with EEA relevance)

• CELEX: Delegated Regulation (EU) 2021/1350
• Articles: 4

Article 1 Decision-making procedures, allocation of functions and responsibilities and internal reporting lines

1.   The governance arrangements of benchmark administrators shall be approved by the management body, if any, and shall specify, in a clear and well documented manner, all of the following:

(a)

the procedures for the management’s decision-making;

(b)

an organisational chart of the benchmark administrator, setting out how functions and responsibilities are allocated to the persons directly involved in the provision of a benchmark;

(c)

internal reporting lines.

2.   The procedures referred to in paragraph 1, point (a), shall cover all of the following, where applicable:

(a)

the composition, roles and responsibilities of the management body and of any related committees;

(b)

the structure of the management body;

(c)

the appointment of the management body.

3.   The organisational chart referred to in paragraph 1, point (b), shall specify any outsourced functions within and outside the administrator’s group and any shared staff within the administrator’s group. In allocating functions and responsibilities, the governance arrangements of administrators shall ensure that, where persons perform multiple functions or are involved in various committees, they are able to commit sufficient time to the functions and responsibilities allocated to them and are not prevented from discharging their functions soundly, honestly and professionally.

For the purposes of the first subparagraph, administrators shall take into account the number of meetings that the relevant person has to attend, the nature of the specific position and the related responsibilities and whether the person concerned carries out any other function or activity.

4.   The governance arrangements of benchmark administrators shall provide for a clear remuneration framework for all persons directly involved in the provision of the benchmark, taking into account the functions and responsibilities allocated to them.

5.   Benchmark administrators may choose not to apply paragraph 2, point (c), and paragraph 4 with respect to their non-significant benchmarks.

6.   Benchmark administrators may choose not to apply paragraph 2, point (c), and paragraph 4 where such opt-out is appropriate and proportionate, having regard to the following:

(a)

the nature, scale and complexity of the activities of the administrator;

(b)

the likelihood of a conflict of interest arising between the provision of the benchmark and any other activities of the administrator;

(c)

the level of discretion involved in the process of provision of the benchmark.

Article 2 Accountability

1.   The governance arrangements of benchmark administrators shall, as part of their organisational structure, specify in a clear and well documented manner the accountability of the following persons:

(a)

the persons responsiblefor decisions that could have a significant impact on the provision of the benchmark, in particular where taking those decisions is delegated

(b)

the persons responsible for the publication or disclosure of existing or potential conflicts of interest pursuant to Article 4(5) of Regulation (EU) 2016/1011;

(c)

the persons responsible for the establishment of specific internal control procedures to ensure the integrity and reliability of the employee or person determining the benchmark, referred to in Article 4(8) of Regulation (EU) 2016/1011;

(d)

the persons responsible for the internal reporting of any circumstance that may give rise to conflicts of interest.

2.   Benchmark administrators may choose not to apply paragraph 1, point (d), with respect to their non-significant benchmarks.

Article 3 Transparency requirements

1.   The governance arrangements of benchmark administrators shall ensure that all of their managers or employees, and any other natural person whose services are placed at their disposal or under their control and who are directly involved in the provision of a benchmark, are aware of their responsibilities and of the procedures that must be followed for the proper discharge of those responsibilities.

2.   Where a benchmark administrator is part of a group, the governance arrangements of that administrator shall detail any functions related to any concernedservices and activities in the provision of the benchmark that have been outsourced, including to group entities, in accordance with Article 10 of Regulation (EU) 2016/1011.

Article 4 Entry into force and application

This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union .

It shall apply from 1 January 2022.