IB 
Union Calendar No. 147 
117TH CONGRESS 
1ST SESSION H. R. 4616 
[Report No. 117–206, Part I] 
To deem certain references to LIBOR as referring to a replacement bench-
mark rate upon the occurrence of certain events affecting LIBOR, and 
for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 22, 2021 
Mr. SHERMAN introduced the following bill; which was referred to the Com-
mittee on Financial Services, and in addition to the Committees on Ways 
and Means, and Education and Labor, for a period to be subsequently 
determined by the Speaker, in each case for consideration of such provi-
sions as fall within the jurisdiction of the committee concerned 
DECEMBER 7, 2021 
Reported from the Committee on Financial Services with an amendment 
[Strike out all after the enacting clause and insert the part printed in italic] 
DECEMBER 7, 2021 
Committees on Ways and Means and Education and Labor discharged; com-
mitted to the Committee of the Whole House on the State of the Union 
and ordered to be printed 
[For text of introduced bill, see copy of bill as introduced on July 22, 2021] 
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A BILL 
To deem certain references to LIBOR as referring to a 
replacement benchmark rate upon the occurrence of cer-
tain events affecting LIBOR, and for other purposes. 
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Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Adjustable Interest Rate 
(LIBOR) Act of 2021’’. 
SEC. 2. FINDINGS AND PURPOSE. 
(a) FINDINGS.—The Congress finds that— 
(1) LIBOR is used as a benchmark rate in more 
than $200 trillion of contracts worldwide; 
(2) a significant number of existing contracts 
that reference LIBOR do not provide for the use of a 
clearly defined or practicable replacement benchmark 
rate when LIBOR is discontinued; and 
(3) the cessation or non-representativeness of 
LIBOR could result in disruptive litigation related to 
existing contracts that do not provide for the use of 
a clearly defined or practicable replacement bench-
mark rate. 
(b) PURPOSE.—It is the purpose of this Act— 
(1) to establish a clear and uniform process, on 
a nationwide basis, for replacing LIBOR in existing 
contracts the terms of which do not provide for the use 
of a clearly defined or practicable replacement bench-
mark rate, without affecting the ability of parties to 
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use any appropriate benchmark rate in new con-
tracts; 
(2) to preclude litigation related to existing con-
tracts the terms of which do not provide for the use 
of a clearly defined or practicable replacement bench-
mark rate; and 
(3) to allow existing contracts that reference 
LIBOR but provide for the use of a clearly defined 
fallback and practicable replacement rate, to operate 
according to their terms. 
(c) RULE OF CONSTRUCTION.—Nothing in this Act 
shall be construed to disfavor the use of any benchmark rate 
on a prospective basis. 
SEC. 3. DEFINITIONS. 
As used in this Act, the following terms shall have the 
following meanings: 
(1) ‘‘Benchmark’’ shall mean an index of interest 
rates or dividend rates that is used, in whole or in 
part, as the basis of or as a reference for calculating 
or determining any valuation, payment or other 
measurement. 
(2) ‘‘Benchmark Administrator’’ means a person 
that publishes a Benchmark for use by third parties. 
(3) ‘‘Benchmark Replacement’’ shall mean a 
Benchmark, or an interest rate or dividend rate 
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(which may or may not be based in whole or in part 
on a prior setting of LIBOR), to replace LIBOR or 
any interest rate or dividend rate based on LIBOR, 
whether on a temporary, permanent, or indefinite 
basis, under or in respect of a LIBOR Contract. 
(4) 
‘‘Benchmark 
Replacement 
Conforming 
Changes’’ shall mean any technical, administrative, 
or operational changes, alterations, or modifications 
that— 
(A) the Board establishes for the purpose of 
facilitating the implementation, administration, 
and calculation of the Board-Selected Benchmark 
Replacement; or 
(B) in the reasonable judgment of a Calcu-
lating Person, are otherwise necessary or appro-
priate to permit the implementation, adminis-
tration, and calculation of the Board-Selected 
Benchmark Replacement under or in respect of a 
LIBOR Contract after giving due consideration 
to any Benchmark Replacement Conforming 
Changes under subparagraph (A). 
(5) ‘‘Board’’ means the Board of Governors of the 
Federal Reserve System. 
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(6)(A) 
‘‘Board-Selected 
Benchmark 
Replace-
ment’’ shall mean a Benchmark Replacement identi-
fied by the Board that is based on SOFR. 
(B) The Board shall adjust the Board-Selected 
Benchmark Replacement for each category of LIBOR 
Contract that the Board may identify to— 
(i) apply to each LIBOR tenor; and 
(ii) incorporate the relevant Tenor Spread 
Adjustment. (C) For Consumer Loans, the 
Board-Selected Benchmark Replacement shall 
initially reflect the spread between the Board-Se-
lected Benchmark Replacement and LIBOR im-
mediately before the LIBOR Replacement Date 
and shall incorporate the relevant Tenor Spread 
Adjustment over a one-year transition period. 
(7) ‘‘Calculating Person’’ shall mean, with re-
spect to any LIBOR Contract, any person (which 
may be the Determining Person) responsible for calcu-
lating or determining any valuation, payment, or 
other measurement based on a Benchmark. 
(8) ‘‘Consumer Loan’’ shall mean a consumer 
credit transaction. For purposes of this paragraph, 
the terms ‘‘consumer’’ and ‘‘credit’’ have the meaning 
given those terms, respectively, under section 103 of 
the Truth in Lending Act (15 U.S.C. 1602). 
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(9) ‘‘Determining Person’’ shall mean, with re-
spect to any LIBOR Contract, any person with the 
authority, right, or obligation, including on a tem-
porary basis, (as identified by the provisions of the 
LIBOR Contract, or as identified by the governing 
law of the LIBOR Contract, as appropriate) to deter-
mine a Benchmark Replacement. 
(10) ‘‘Fallback Provisions’’ shall mean terms in 
a LIBOR Contract for determining a Benchmark Re-
placement, including any terms relating to the date 
on which the Benchmark Replacement becomes effec-
tive. 
(11) ‘‘LIBOR’’ shall mean the overnight and 1- 
, 3-, 6-, and 12-month tenors of U.S. dollar LIBOR 
(formerly known as the London interbank offered 
rate) as administered by ICE Benchmark Adminis-
tration Limited (or any predecessor or successor 
thereof). LIBOR shall not include the 1-week or 2- 
month tenors of U.S. dollar LIBOR. 
(12) ‘‘LIBOR Contract’’ shall mean, without 
limitation, any contract, agreement, indenture, orga-
nizational documents, guarantee, mortgage, deed of 
trust, lease, Security (whether representing debt or eq-
uity, and including any interest in a corporation, a 
partnership, or a limited liability company), instru-
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ment, or other obligation or asset that, by its terms, 
continues in any way to use LIBOR as a Benchmark 
as of the applicable LIBOR Replacement Date. 
(13) ‘‘LIBOR Replacement Date’’ shall mean the 
first London banking day after June 30, 2023, unless 
the Board determines that any LIBOR tenor will 
cease to be published or cease to be representative on 
a different date. 
(14) ‘‘Security’’ shall have the meaning assigned 
to such term in section 2(a) of the Securities Act of 
1933 (15 U.S.C. 77b(a)). 
(15) ‘‘SOFR’’ shall mean the Secured Overnight 
Financing Rate published by the Federal Reserve 
Bank of New York (or a successor administrator). 
(16) ‘‘Tenor Spread Adjustment’’ shall mean— 
(A) 0.00644 percent for overnight LIBOR; 
(B) 0.11448 percent for 1-month LIBOR; 
(C) 0.26161 percent for 3-month LIBOR; 
(D) 0.42826 percent for 6-month LIBOR; 
and 
(E) 0.71513 percent for 12-month LIBOR. 
SEC. 4. LIBOR CONTRACTS. 
(a) On the LIBOR Replacement Date, the Board-Se-
lected Benchmark Replacement shall, by operation of law, 
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quired to obtain consent from any other person prior to the 
adoption of Benchmark Replacement Conforming Changes. 
(g) The provisions of this Act shall not alter or im-
pair— 
(1) any written agreement specifying that a 
LIBOR Contract shall not be subject to this Act; 
(2) any LIBOR Contract that contains Fallback 
Provisions that identify a Benchmark Replacement 
that is not based in any way on any LIBOR value 
(including, but not limited to, the prime rate or the 
Effective Federal Funds Rate), except that such 
LIBOR Contract shall be subject to subsection (b); 
(3) any LIBOR Contract subject to subsection 
(c) as to which a Determining Person does not elect 
to use a Board-Selected Benchmark Replacement pur-
suant to subsection (c), except to the extent that such 
LIBOR Contract is subject to subsection (b) or (e); 
(4) the application to a Board-Selected Bench-
mark Replacement of any cap, floor, modifier, or 
spread adjustment to which LIBOR had been subject 
pursuant to the terms of a LIBOR Contract; or 
(5) any provisions of Federal consumer financial 
law that requires creditors to notify borrowers regard-
ing a change-in-terms. 
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(h) Except as provided in section 5(c), the provisions 
of this Act shall not alter or impair the rights or obligations 
of any person, or the authorities of any agency, under Fed-
eral consumer financial law (as defined in section 1002(14) 
of the Dodd-Frank Wall Street Reform and Consumer Pro-
tection Act (12 U.S.C. 5481(14)). 
SEC. 5. CONTINUITY OF CONTRACT AND SAFE HARBOR. 
(a) A Board-Selected Benchmark Replacement and the 
selection or use of a Board-Selected Benchmark Replace-
ment as a Benchmark Replacement under or in respect of 
a LIBOR Contract, as well as any Benchmark Replacement 
Conforming Changes, by operation of section 4 shall con-
stitute— 
(1) a commercially reasonable replacement for 
and a commercially substantial equivalent to LIBOR; 
(2) a reasonable, comparable, or analogous rate, 
index, or term for LIBOR; 
(3) a replacement that is based on a methodology 
or information that is similar or comparable to 
LIBOR; 
(4) substantial performance by any person of 
any right or obligation relating to or based on 
LIBOR; and 
(5) a replacement that has historical fluctuations 
that are substantially similar to those of LIBOR for 
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purposes of the Truth in Lending Act and its imple-
menting regulations. 
(b) Neither of (1) the selection or use of a Board-Se-
lected Benchmark Replacement as a Benchmark Replace-
ment or (2) the determination, implementation, or perform-
ance of Benchmark Replacement Conforming Changes, in 
each case by operation of section 4, shall (A) be deemed to 
impair or affect the right of any person to receive a pay-
ment, or to affect the amount or timing of such payment, 
under any LIBOR Contract or (B) have the effect of (i) 
discharging or excusing performance under any LIBOR 
Contract for any reason, claim, or defense (including, but 
not limited to, any force majeure or other provision in any 
LIBOR Contract), (ii) giving any person the right to uni-
laterally terminate or suspend performance under any 
LIBOR Contract, (iii) constituting a breach of any LIBOR 
Contract, or (iv) voiding or nullifying any LIBOR Con-
tract. 
(c) No person shall be subject to any claim or cause 
of action in law or equity or request for equitable relief, 
or have liability for damages, arising solely out of the selec-
tion or use of a Board-Selected Benchmark Replacement or 
the determination, implementation, or performance of 
Benchmark Replacement Conforming Changes, in each case 
by operation of section 4; provided, however, that any per-
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son (including a Calculating Person) shall remain subject 
to any existing legal, regulatory, or contractual obligations 
to correct servicing or other ministerial errors under or in 
respect of a LIBOR Contract. 
(d) The selection or use of a Board-Selected Benchmark 
Replacement or the determination, implementation, or per-
formance of Benchmark Replacement Conforming Changes, 
in each case by operation of section 4, shall not be deemed 
to— 
(1) be an amendment or modification of any 
LIBOR Contract; or 
(2) prejudice, impair, or affect any person’s 
rights, interests, or obligations under or in respect of 
any LIBOR Contract. 
(e) Except as provided in either subsections (a), (b), 
or (c) of section 4, the provisions of this Act shall not be 
interpreted as creating any negative inference or negative 
presumption regarding the validity or enforceability of— 
(1) any Benchmark Replacement (including any 
method for calculating, determining, or implementing 
an adjustment to the Benchmark Replacement to ac-
count for any historical differences between LIBOR 
and the Benchmark Replacement) that is not a 
Board-Selected Benchmark Replacement; or 
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(2) any changes, alterations, or modifications to 
or in respect of a LIBOR Contract that are not 
Benchmark Replacement Conforming Changes. 
SEC. 6. PREEMPTION. 
(a) This Act and the regulations hereunder shall super-
sede any and all laws, statutes, rules, regulations, or stand-
ards of any State, the District of Columbia, or any territory 
or possession of the United States, insofar as they provide 
for the selection or use of a Benchmark Replacement or re-
lated conforming changes. 
(b) No provision of State or local law that expressly 
limits the manner of calculating interest, including the 
compounding of interest, shall apply to the selection or use 
of a Board-Selected Benchmark Replacement or Benchmark 
Replacement Conforming Changes. 
SEC. 7. TRUST INDENTURE ACT OF 1939. 
Section 316 of the Trust Indenture Act of 1939 (15 
U.S.C. 77ppp) is amended— 
(1) by striking ‘‘and’’ after ‘‘of subsection (a),’’ 
in subsection (b); and 
(2) by inserting ‘‘, and except that the right of 
any holder of any indenture security to receive pay-
ment of the principal of and interest on such inden-
ture security shall not be deemed to be impaired or 
affected by any change occurring by the application 
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of section 4 of the Adjustable Interest Rate (LIBOR) 
Act of 2021 to any indenture security’’ after ‘‘subject 
to such lien’’ in subsection (b). 
SEC. 8. RULEMAKING. 
Not later than 180 days after the date of enactment 
of this Act, the Board shall issue such regulations as may 
be necessary or appropriate to enable it to administer and 
carry out the purposes of this Act. 
SEC. 9. INTERBANK OFFERED RATE TRANSITION RULE OF 
CONSTRUCTION. 
None of— 
(1) the selection or use of a Board-Selected 
Benchmark Replacement as a Benchmark Replace-
ment, 
(2) the determination, implementation, or per-
formance of Benchmark Replacement Conforming 
Changes; or 
(3) the application to any LIBOR Contract of, 
or the agreement by parties thereto to terms consistent 
with, section 4, 
shall be treated as a transfer, disposition, or conversion of 
property. 
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Union Calendar No. 147 
117TH CONGRESS 
1ST SESSION 
H. R. 4616 
[Report No. 117–206, Part I] 
A BILL 
To deem certain references to LIBOR as referring 
to a replacement benchmark rate upon the occur-
rence of certain events affecting LIBOR, and for 
other purposes. 
DECEMBER 7, 2021 
Reported from the Committee on Financial Services with 
an amendment 
DECEMBER 7, 2021 
Committees on Ways and Means and Education and 
Labor discharged; committed to the Committee of the 
Whole House on the State of the Union and ordered 
to be printed 
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