[co-author: Julien Martinet]
With significant work being undertaken by industry bodies and institutions to prepare for the cessation of LIBOR in 2021, we have launched our Litigation and regulatory risks of LIBOR cessation guide to highlight litigation and regulatory risks in different jurisdictions.
Since the UK Financial Conduct Authority announced in summer 2017 that it would no longer persuade or compel panel banks to submit contributions for the calculation of the LIBOR benchmark after the end of 2021, significant work by industry bodies and institutions to prepare for the cessation of LIBOR has been undertaken.
However, transition efforts are progressing against a background of considerable uncertainty, and the vast volume of LIBOR-referencing instruments and the complexity of the transition process give rise to risks of litigation and regulatory action.
Fallback provisions in contracts entered into before the cessation of LIBOR was contemplated are likely to be insufficient and, in the absence of agreement, parties may need to turn to the courts to resolve disputes. Regulators have been clear about the need to prepare for the transition. Some regulators have even highlighted the litigation risk and the risk of enforcement action.
Drawing on our international network of litigation specialists, we have prepared a comparative analysis LIBOR guide which highlights some of the litigation and regulatory risks in different jurisdictions.
Download the guide below.