On December 3, 2021, the Alternative Reference Rates Committee (ARRC), the relevant recommending body for LIBOR legislation enacted in New York (NY) and Alabama (AL), selected and recommended replacement benchmarks (based on the Secured Overnight Financing Rate (SOFR)) and associated spread adjustments and conforming changes for certain NY and AL law-governed contracts that reference 1-week and 2-month USD LIBOR and to which the NY and AL LIBOR legislation applies.

ICE Benchmark Administration has announced that it will cease publication on a representative basis of the 1-week and 2-month USD LIBOR tenors on December 31, 2021. The ARRC recommendations apply to NY and AL law-governed contracts (and are intended to apply for purposes of any similar legislation enacted in other states) that lack LIBOR fallback provisions or that elect to take advantage of the statutes' safe harbor.

The ARRC also published FAQs on the recommendations regarding:

For additional information on LIBOR fallback provisions, see Loan Agreement LIBOR Fallback Language Toolkit and LIBOR Replacement Toolkit.