After 2021, it is anticipated that London interbank offered rates (LIBORs), which are used as reference rates in the loan, bond and derivatives markets, will cease to be published. In preparation, regulators have identified recommended alternative ‘nearly risk free’ benchmark rates (RFRs) to replace them. Parties to financial contracts should now be thinking about the potential tax implications which may arise in the run up to, on and after LIBOR discontinuation. There is unlikely to be a ‘one size fits all’ result, and analysis should be undertaken on a contract by contract basis.
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After 2021, it is anticipated that London interbank offered rates (LIBORs), which are used as reference rates in the loan, bond and derivatives markets, will cease to be published. In preparation, regulators have identified recommended alternative ‘nearly risk free’ benchmark rates (RFRs) to replace them. Parties to financial contracts should now be thinking about the potential tax implications which may arise in the run up to, on and after LIBOR discontinuation. There is unlikely to be a ‘one size fits all’ result, and analysis should be undertaken on a contract by contract basis.
If you are not a subscriber, subscribe now to read this content.
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