Adequate contractual fallback provisions refer to fallback arrangements that cater for a permanent discontinuation of the relevant benchmarks and facilitate an orderly transition to the adjusted versions of the respective ARRs as replacement rates.
OTC derivatives reporting
- Benchmark transition may trigger reporting requirements for OTC derivatives contracts. Please refer to the FAQs on the Securities and Futures (Reporting of Derivatives Contracts) Regulations 2013.
OTC derivatives clearing and trading
- OTC derivatives contracts referencing ARRs are currently not prescribed for clearing or trading requirements under the Securities and Futures (Clearing of Derivatives Contracts) Regulations 2018 and Securities and Futures (Trading of Derivatives Contracts) Regulations 2019, respectively. MAS will be reviewing the clearing and trading requirements of OTC derivatives contracts referencing ARRs and will consult on the proposed amendments in due course.
Margin requirements for non-centrally cleared OTC derivatives
- Legacy OTC derivatives contracts that are amended solely to address interest rate benchmark reforms are not considered new derivatives contracts, and thus the MAS Guidelines on margin requirements for non-centrally cleared OTC derivatives contracts (SFA 15-G03) need not be applied to them.