Amendments to the Benchmarks Regulation to support LIBOR transition
This statement accompanies the Financial Services Bill, introduced on 20 October, which makes amendments to the Benchmarks Regulation to cater for the orderly wind-down of a critical benchmark, such as LIBOR.
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This statement emphasises the importance of continued active transition away from LIBOR, ahead of its expected cessation after end-2021. It also sets out amendments to the Benchmarks Regulation through the government’s Financial Services Bill.
The provides an overarching legal framework that equips the Financial Conduct Authority (FCA) with new and enhanced powers to manage and direct the orderly wind-down of LIBOR.
To cater for those contracts which face insurmountable barriers to transitioning away from LIBOR (“tough legacy contracts”), this framework includes the option for the FCA to direct a change in the methodology of a critical benchmark and extend its publication for a limited time period.