New York State passed Senate Bill 297B/Assembly Bill 164B to reduce the risks associated with the transition from the London Inter-Bank Offered Rate ("LIBOR").*
As previously covered, the legislation permits indices recommended by the Alternative Reference Rates Committee ("ARRC") to be "appropriate replacements" for LIBOR in financial contracts that otherwise would be negatively impacted by the transition from LIBOR (i.e., existing contracts that incorporate ambiguous fallback language or do not address the end of LIBOR in 2021).
In separate statements, the ARRC and SIFMA praised the passage of the legislation, explaining that because many of the financial products and contracts referencing LIBOR are under New York's jurisdiction, the legislation will reduce the burden on New York's courts resulting from legal uncertainty associated with the transition from LIBOR.
*Cadwalader, Wickersham & Taft LLP serves as counsel to ARRC and helped to draft New York State Senate Bill 297B/Assembly Bill 164B. See Cadwalader's official news release.
Primary Sources
- ARRC Press Release: ARRC Welcomes Passage of LIBOR Legislation by the New York State Legislature
- SIFMA Statement: SIFMA Statement on Passage of New York State LIBOR Legislation
- New York State Senate Bill 297B/Assembly Bill 164B
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