On June 23, the UK Government published a statement on the transition away from London Inter-bank Offered Rate (LIBOR) with a focus on legacy contracts (the Statement).
The Statement sets out the UK Government’s intention to legislate to amend and strengthen the existing regulatory framework for benchmarks, rather than imposing legal changes on LIBOR-referencing contracts that are governed by English law. By the end of 2021, the UK Financial Conduct Authority (FCA) should be granted the appropriate regulatory powers to manage an orderly transition away from LIBOR in a way that protects consumers and ensures market integrity. In particular, the FCA may be able to help market participants identify certain legacy LIBOR contracts for specific limited continued use where there are no genuine or appropriate alternatives, and no realistic ability to be renegotiated or amended.
The Statement is available here.