Legal & Regulatory News

Low Carbon Benchmarks Regulation

Regulation (EU) 2019/2089 (the "Low Carbon Benchmarks Regulation") was published in the Official Journal on 10 December 2019 in order to amend Regulation (EU) 2016/1011 (the “Benchmark Regulation”).

From 30 April 2020, the Low Carbon Benchmarks Regulation will require all benchmark administrators to make certain disclosures in respect of all benchmarks which pursue environmental, social and governance ("ESG") objectives, save for interest rate and currency benchmarks. Under these disclosure requirements, benchmark administrators will be required to provide an explanation of how the key elements of the benchmark methodology reflect ESG factors together with an explanation in the benchmark statement of how ESG factors are reflected in each benchmark.

For those benchmarks or families of benchmarks that do not pursue ESG objectives, it shall be sufficient for benchmark administrators to clearly state in the benchmark statement that they do not pursue such objectives.

From 31 December 2021, the Low Carbon Benchmarks Regulation will also require all benchmark administrators to include in their benchmark statement an explanation of how their methodology aligns with the target of carbon emission reductions or attains the objectives of the Paris Agreement.

Click here to access the Low Carbon Benchmarks Regulation.