On 4 August 2020, the ISDA published a letter dated 22 July 2020 that it had sent to the risk-free rate working groups concerning adherence to the ISDA IBOR Fallback Protocol.

Key points in the letter include that the ISDA hopes to soon be in a position to launch the IBOR Fallback Protocol and the IBOR Fallback Supplement to implement the new fallbacks for legacy and new derivative contracts, respectively. The ISDA states that the documents should be final by the end of July subject to receiving a positive business review letter from the US Department of Justice and similar feedback from competition authorities in other jurisdictions. The fallbacks will take effect in new contracts via the IBOR Fallback Supplement and in legacy contracts that are amended by the IBOR Fallback Protocol (or bilaterally) on a set date about four months later. The ISDA will provide market participants with approximately two weeks’ notice of the official launch date and later effective date. During the two week period the ISDA states that it expects to facilitate a process whereby regulated entities and other key market participants can adhere to the IBOR Fallback Protocol ‘in escrow’ prior to the launch date. Such adherence will be binding and complete but the adhering entity’s name and information will not appear on the ISDA website until the official launch date. Entities that adhere in escrow will do so via a private link that the ISDA sends them.