ARRC Identifies 2020 Key Objectives

The Alternative Reference Rates Committee ("ARRC") set forth key objectives for 2020 in order to support the voluntary use of the Secured Overnight Financing Rate ("SOFR") and the transition away from the LIBOR.

The ARRC stated that it was mindful when creating its 2020 key objectives of possible impacts created by COVID-19, while reminding firms that they cannot rely on LIBOR being published after the end of 2021 (noting, in particular, the UK FCA's March 25, 2020 statement). The 2020 key objectives include:

• promoting the adoption of SOFR and liquidity;

• supporting market infrastructure and operations in a way that is compatible with SOFR;

• encouraging the creation and use of robust contractual fallbacks;

• providing resources for consumer education and outreach efforts;

• clarifying all key legal, tax, accounting and regulatory issues; and

• strengthening outreach, education and global efforts.

In addition, the ARRC noted that a series of recommended best practices is forthcoming.