rec_5

(5) As of 31 December 2020, upon the end of the transition period provided for in the Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community OJ L 29, 31.1.2020, p. 7. , the interest rate benchmark London Interbank Offered Rate (LIBOR) no longer qualifies as a critical benchmark under Regulation (EU) 2016/1011. In addition, the Financial Conduct Authority (FCA) of the United Kingdom announced in 2017 that it would not persuade or compel panel banks to submit to LIBOR beyond the end of 2021. Subsequent announcements by the FCA and the administrator of LIBOR have made it clear that LIBOR is likely to be wound down in most of the tenors and currencies for which it is calculated by the end of 2021, with other tenors and currencies of LIBOR to follow in 2023. The cessation or wind-down of LIBOR might result in negative consequences that significantly disrupt the functioning of financial markets in the Union. There is a vast number of contracts that affect economic operators in the Union and that pertain to debt, loans, term deposits, securities and derivatives that all reference LIBOR, that mature later than 31 December 2021 and that do not contain sufficiently robust fallback provisions to cover the cessation or the wind-down of LIBOR as calculated for the relevant currency or some of its tenors. Some of those contracts, and some financial instruments as defined in Directive 2014/65/EU of the European Parliament and of the Council Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (OJ L 173, 12.6.2014, p. 349). , cannot be renegotiated in order to incorporate a contractual fallback provision before 31 December 2021.

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Source: EUR-Lex (Cellar) · retrieved 2026-10-18 · Text as adopted (Official Journal); later amendments are not incorporated in this text.