​EC Feedback Request - Statutory replacement rates for the EONIA benchmark

Tuesday, 10 August 2021

​EC Feedback Request - Statutory replacement rates for the EONIA benchmark

The European Commission has requested feedback on the published draft implementing regulation designating €STR plus 8.5bps as the replacement for EONIA in contracts and financial instruments referred to in Article 23a of the Benchmarks Regulation (Regulation (EU) 2016/1011). The effect being that the replacement rate would, by operation of Article 23b of the Benchmarks Regulation, replace all references to that benchmark for in scope contracts and financial instruments, provided that such contracts do not contain fall-back provisions or suitable fall-back provisions (within the meaning of Article 23b). It is designed to address concerns regarding continued exposure to EONIA in “legacy” contracts after EONIA is discontinued on 3 January 2022. Members should bear in mind that this regulation will only be relevant to contracts and financial instruments referred to in Article 23a. Feedback is due by 31 August 2021, with the intention for the EC to adopt in Q3 2021.

The European Commission has also requested feedback on a published draft implementing regulation designating a specified compounded SARON rate, subject to a fixed spread adjustment (which depends on the tenor), as the replacement for certain settings of CHF LIBOR that will cease to be published on 1 January 2022 in contracts and financial instruments encompassed by Article 23a. Feedback is also due by 31 August 2021.

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