September 13, 2019

CFTC Market Risk Advisory Committee Approves Plain English Disclosures at Public Meeting

Washington, DC — The U.S. Commodity Futures Trading Commission’s Market Risk Advisory Committee (MRAC) approved plain English disclosures for new derivatives referencing the London Interbank Offered Rate (LIBOR) and other IBORS at its September 9, 2019 public meeting.  Commissioner Rostin Behnam is the sponsor of MRAC. 

This standard set of disclosures, prepared by the MRAC’s Interest Rate Benchmark Reform Subcommittee (Subcommittee), is intended as a helpful example of “plain English” disclosures that market participants could use, as they deem appropriate, with all clients and counterparties with whom they continue to transact derivatives referencing LIBOR and other IBORs.  The disclosures inform clients and counterparties about the implications of using such products. 

“I commend the MRAC and its Interest Rate Benchmark Reform Subcommittee for providing the Commission with a well-reasoned and thoughtful approach to educating market participants about the consequences of continuing to use LIBOR based products. Many thanks to the Subcommittee for their hard work on this important contribution to the benchmark reform effort,” said Commissioner Behnam.  

The disclosures represent the Subcommittee’s first recommendation in connection with the transition of U.S. dollar derivatives and related contracts away from LIBOR.  The disclosures will be submitted to the Commission for consideration. 

Click here to view the approved disclosures.

-CFTC-