CP21/29: Proposed decisions on the use of LIBOR (Articles 23C and 21A BMR)

Consultation closes

We are asking for views on our proposals to use new powers for certain LIBOR settings.

Read CP21/29

Why we are consulting

On 20 May 2021 we consulted on our proposed policies on the exercise of 2 new powers introduced through amendments to the Benchmarks Regulation (BMR) under the Financial Services Act 2021 (FS Act). That consultation closed on 17 June and we have published our Feedback Statement and final Statements of Policy (Article 21A and Article 23C under the BMR).

We are now seeking views on our proposed decisions to use these powers for certain LIBOR settings.

What we are proposing

Our proposed decisions are on whether and how to: 

  • permit legacy use of 1 month, 3 month and 6 month sterling and 1 month, 3 month and 6 month yen LIBOR from 1 January 2022 (see Chapter 3) 
  • prohibit new use of overnight, 1 month, 3 month, 6 month and 12 month US dollar LIBOR (see Chapter 4)

Background to the Benchmarks Regulation work

The new powers under Article 23C(2) and Article 21A of the BMR relate to the use of critical benchmarks, where this use is within scope of the BMR (‘use of a benchmark’ is defined at Article 3(1)(7)). They were introduced as part of a wider package of amendments to the BMR.

This package was intended to ensure that we have the appropriate regulatory powers to help reduce risks to market integrity and consumer protection in the wind-down period before LIBOR ceases permanently.

Respond to this consultation

You can respond using the following:

Online response form

Email: [email protected]

Next steps   

We are seeking responses to this consultation by 20 October 2021.

Following this consultation, we will consider and take into account any feedback when finalising our decisions. We will confirm our final decisions as soon as practicable.

We will publish Notices setting out our decisions, and the reasons for them, in line with the relevant requirements under the BMR.