In fallback documentation, it is an event that would activate the fallback provision (incorporated into a contract or arrangement in which a fallback rate is set out). A fallback (or fallback rate) is a rate of interest that can be used if the reference rate for a certain arrangement or contract (a facility, instrument, etc,) is unavailable or not published. It is an alternative rate of interest that would have been applicable under the terms of the contract if the defined rate had become unavailable for some reason (such as the case when the reference rate cannot be determined and published).

This trigger event provides for the announcement of the discontinuation of a reference rate by the regulatory supervisor of the rate administrator. In general, trigger events should be precise, objective and publicly available. An unofficial statement by a public authority that a rate could be discontinued in the future should not indicate a trigger event.

The fallback trigger represents a public statement from either the administrator or the administrator’s supervisor announcing that a reference rate will permanently no longer be published. If such a statement is issued, the reference rate will be deemed to permanently cease.