Benchmarks & Data Services
FCA Authorisation
Specialist regulatory support for benchmark administrators, data reporting service providers, and firms operating critical market infrastructure.
Benchmarks & Data Services Regulatory Landscape
The benchmarks and data services sector provides critical market infrastructure including financial benchmarks (interest rates, commodity prices, indices), data reporting services for transaction reporting, and approved publication arrangements for market transparency.
Following the LIBOR manipulation scandals, the EU Benchmarks Regulation (BMR) introduced comprehensive requirements for benchmark administrators to ensure integrity, reliability, and governance. MiFID II/MiFIR created parallel frameworks for data reporting service providers supporting transaction reporting and market transparency.
Successfully navigating authorisation requires demonstrating robust governance structures, comprehensive input data controls, effective oversight arrangements, and technical infrastructure capable of ensuring benchmark integrity and accurate, timely data transmission to regulators.
Typical Services
- Financial benchmark administration (interest rates, FX, commodities)
- Approved Reporting Mechanisms (ARMs) for transaction reporting
- Approved Publication Arrangements (APAs) for trade publication
- Consolidated Tape Providers (CTPs) for market data aggregation
- Index and equity benchmark calculation
- Commodity and ESG benchmark services
Required FCA Permissions
Benchmark and data service firms require specific authorisations under BMR and MiFID II/MiFIR.
Administering a Benchmark
Administering a regulated benchmark under the EU Benchmarks Regulation including critical and significant benchmarks.
- BMR compliance framework
- Oversight function
- Code of conduct
- Input data controls
Operating an ARM
Operating an Approved Reporting Mechanism for reporting transactions to the FCA on behalf of investment firms.
- Secure transmission systems
- Data accuracy controls
- Timeliness monitoring
- Client identity verification
Operating an APA
Operating an Approved Publication Arrangement for publishing trade reports to comply with transparency obligations.
- Publication infrastructure
- Real-time dissemination
- Data quality assurance
- Public accessibility
Operating a CTP
Operating a Consolidated Tape Provider collecting and consolidating trade reports for public dissemination.
- Data aggregation capability
- Consolidation algorithms
- Distribution systems
- Quality controls
Providing Benchmark Contributions
Contributing input data to a regulated benchmark, subject to BMR contributor requirements.
- Contributor code of conduct
- Systems and controls
- Record-keeping
- Conflicts management
Providing Market Data Services
Providing reference data, pricing data, and market information services to financial institutions.
- Data accuracy verification
- Timeliness standards
- Client agreements
- Technology infrastructure
Key Regulatory Requirements
Benchmark and data service providers must demonstrate compliance with BMR and MiFID II/MiFIR frameworks.
EU Benchmarks Regulation (BMR) Compliance
Input Data and Methodology Requirements
MiFID II Data Reporting Service Provider Requirements
Governance and Oversight Function
Systems, Controls, and Technology Infrastructure
Financial Resources and Capital
Common Authorisation Challenges
Issues we frequently help benchmark and data service providers navigate during the FCA application process.
Establishing an effective independent oversight function is critical for BMR compliance. We help design oversight committee structures, identify appropriate external members, and document oversight procedures covering methodology, conflicts, and expert judgment.
Demonstrating robust input data quality and prioritization frameworks. We create comprehensive input data policies, validation controls, waterfall methodologies, and expert judgment governance aligned with BMR expectations.
Building or evidencing sufficient technology infrastructure for data collection, calculation, validation, and dissemination. We help specify system requirements, evaluate vendor solutions, and document technology adequacy for regulatory purposes.
Creating comprehensive, transparent benchmark methodology statements that satisfy BMR disclosure requirements. We develop methodology documentation covering calculation formulas, input data sources, expert judgment use, and contingency arrangements.
For ARMs, implementing systems that comply with complex MiFID II/MiFIR transaction reporting technical standards including RTS 22 and 23. We help design validation rules, implement ISO 20022 messaging, and ensure field-level compliance.
Demonstrating robust business continuity arrangements for critical market infrastructure. We design comprehensive BCP frameworks, implement redundancy and failover systems, and create orderly wind-down or benchmark cessation plans.
How We Support Benchmark and Data Service Providers
Pre-Application
- Benchmark classification (critical, significant, non-significant)
- Permissions scoping and regulatory pathway analysis
- Oversight function design and member identification
- Technology infrastructure assessment and requirements
- Input data sourcing and validation framework design
- Benchmark methodology development and documentation
Application Preparation
- Complete Connect application for BMR or ARM/APA/CTP
- Benchmark statement and methodology documentation
- Oversight function terms of reference and governance
- Code of conduct for contributors (where applicable)
- Input data and validation control frameworks
- Systems and controls documentation for data services
Post-Submission
- FCA technical queries and clarifications
- Oversight function member interviews and assessments
- System demonstrations and infrastructure validation
- Conditional approval requirements fulfillment
- Launch readiness and operational testing
- Ongoing regulatory advisory and BMR/MiFIR compliance
Ready to Get Authorised?
Speak with our benchmarks and data services regulatory specialists to discuss your FCA authorisation.