The U.S. House approved legislation that would provide for an orderly transition of debt contracts off of the London interbank offered rates (LIBOR), promising to head off uncertainty and legal fights over trillions of dollars of securities and loans pegged to the discredited benchmarks.

The measure was included in wide-reaching legislation needed to keep the government running after Friday. It passed by a vote of 260-to-171. The tight time frame and significance of the bill make it unlikely the Senate will seek to dramatically amend the measure.

The LIBOR provisions, based on legislation that passed the House in December, would provide a clear and uniform process for replacing the benchmark in existing contracts that don't have a clearly defined alternative index to use. Bankers, investors, and regulators have said such legislation is crucial to ensuring that a large swath of the U.S. financial system isn't disrupted when the LIBOR indexes are retired.

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