Financial market benchmarks. Between permeable intellectual property and quasi-monopoly

Abstract

Background: Benchmarks are crucial instruments of financial markets. They allow financial institutions to operate and create new products and services while their administrators profit by licensing them. However, it is unclear on what grounds administratorsʼ claims of benchmark ownership rest, which in turn may prompt benchmark users to challenge the licensing regime.

Research purpose: The article is aimed to seek for those grounds and argues that the economic interests of benchmark administrators in the EU are protected through a quasi-monopoly resting on two foundations. First, Intellectual Property to trademark a given benchmark; second, an obligation (and a power) to control the process of provisioning and publishing a benchmark (or making it available). However, neither the national nor the EU laws establish a sui generis, a direct property right to a benchmark.

Methods: Methodologically, the paper rests on analysis of legislation and relevant acts of soft law.

Conclusions: The legal basis for benchmark licensing can be found in two sources: 1) trademark law (both national and European); 2) and on the grounds of Art. 6 Section 1 and Art. 29 Section 1 of the BMR; however, only the latter leads to a quasi-monopoly over a benchmarkʼs use. Both the scope and the level of protection are significantly smaller than they would be in the case of a proprietary, exclusive right to a benchmark.