Category: Dodd-Frank Act Rules

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CFTC To Further Delay Swap Dealer DeMinimis Phase-In

In testimony earlier today before the House Agricultural Committee, CFTC Chairman Christopher Giancarlo announced his advocacy of a one-year delay in the implementation of the reduction in swap dealer de minimis level.  As background, a bank or other market participant can engage in a de minimis level of swap dealing activity without having to register … Continue Reading

Chairman Massad Indicates Expansion to Clearing Requirement is a Priority for 2016

Overview At an open meeting of the U.S. Commodity Futures Trading Commission (CFTC) last Thursday, September 8, Chairman Massad indicated that adopting a final rule to expand the scope of interest rate swaps (IRS) required to be cleared under Section 2(h) of the Commodity Exchange Act (the Clearing Requirement) is a priority for the end … Continue Reading

A Compendium of 2015 Regulatory Activity by the SEC In Respect of Security-Based Swaps

Links to Text of Rules Final Rules: http://www.sec.gov/rules/final.shtml Proposed Rules: http://www.sec.gov/rules/proposed.shtml 2015 Timeline Final Rules (F) and Proposed Rules (P) (F) February 2015 Finalized Registration and Governance Rules that Apply to SBS Data Repositories (F) February 2015 Finalized SBS Data Reporting Rules (P) February 2015 Proposed Rules to Implement the Finalized Reporting Rules, Establish Certain … Continue Reading

Margin on Non-Cleared Swaps – Are Money Market Funds Eligible Collateral?

On October 22, 2015, the prudential banking regulators (which includes the OCC, FDIC and the Federal Reserve Board) approved the final version of the non-cleared swap margin rule (available here). We will be considering many aspects of this rule in a series of postings, but in this posting we focus on a single discrete issue: … Continue Reading

A Marginally Important Day: FDIC’s Board Approves Joint Final Rule on Margin for Uncleared Swaps and Finalizes Relief for End-Users

Earlier today, the Board of Directors (the “Board”) of the Federal Deposit Insurance Corporation (FDIC) approved a final rule to establish margin requirements on non-cleared swaps and security-based swaps (collectively, for this posting, “non-cleared swaps”).  The FDIC is issuing the rule jointly with the OCC, the board of the Federal Reserve,… Continue Reading

SEC Enforcement Action: Illegal Offering of Security-Based Swaps

On June 17th, the Securities and Exchange Commission (“SEC”) announced an enforcement action against a company for illegally offering “complex derivatives products to retail investors”.  According to the related SEC enforcement order, the respondents operated a website that allowed its users to buy or sell contracts that were valued by reference (or “linked”) to the … Continue Reading

CFTC Chairman Massad Outlines Proposal for Margin on Uncleared Swaps in Cross-Border Scenarios

By Andrew P. Cross and Shawn R. Durrani In a speech before the FIA International Derivatives Conference earlier this week, CFTC Chairman Timothy G. Massad outlined a proposal for dealing with the issue of margin on uncleared swaps in situations where one of the counterparties (or perhaps one or both of their guarantors or parent companies) are … Continue Reading

SEC Proposes Dodd-Frank Hedging Policy Disclosures and A Closer Look at Common Hedging Transactions

We have published an update on the recent disclosure proposals under Section 14(j) of the Securities Exchange Act of 1934 (the “Exchange Act”).  The update can be accessed here. In summary, the Securities and Exchange Commission (SEC) recently released long-awaited proposed rules, as mandated by Section 955 of the Dodd-Frank Act, that would require a public … Continue Reading

Attention Corporate Treasurers and Swap Provider Banks: CFTC Updates End-User Exception For Treasury Affiliates

On November 26th, the Division of Clearing and Risk (the “Division”) of the Commodity Futures Trading Commission (“CFTC”) published No-Action Letter 14-144 (also referred to as “CFTC Letter 14-144”), in order to update the conditions that must be satisfied by corporate end-users to avail themselves of “treasury affiliate relief” from the central clearing and trade execution … Continue Reading

CFTC to Southwest Airlines: You Are Now Free to Delay Your Real-Time Public Reporting

When does an airline have bragging rights about a delay?  When it is a delay in real-time reporting. On November 6th, the Division of Market Oversight (the “Division”) of the Commodity Futures Trading Commission (“CFTC”) granted time-limited no-action relief to Southwest Airlines (“Southwest”) and its counterparties to allow additional time to comply with the real-time reporting … Continue Reading

CFTC End-User Meeting To Be Held November 3rd at 10:30 a.m. Eastern

The CFTC recently announced that it will hold a meeting on November 3rd at 10:30 a.m. Eastern to discuss the following issues relating to end-users: 1) Clarification as to when an agreement, contract or transaction with embedded volumetric optionality falls within the forward contract exclusion from the definition of a swap; 2) Conforming the application … Continue Reading

Issues and Trends of Interest to Buy-Side Derivatives End-Users: ISDA Publishes Survey

ISDA recently published the results of a survey that it conducted to identify key issues and trends for the buy-side, derivatives end-user community.  The results are fascinating and, we blelieve, accurately reflect the experiences of many market participants and professionals that are involved in the over-the-counter (OTC) derivatives markets.  The following is a brief summary of … Continue Reading

CFTC Committee to Consider Clearing of Non-Deliverable Forwards and Jurisdiction Over Bitcoin Derivatives at October 9th Meeting

The Global Markets Advisory Committee of the CFTC just annouced that it will consider two issues at an upcoming meeting: 1) Whether a clearing mandate is appropriate for NDFs, with a particular focus on how such a mandate would impact foreign exchange contracts; and 2) The CFTC’s jurisdiction with respect to derivatives contracts that reference … Continue Reading

Banking Regulators Propose New Margin Rules for Non-Cleared Swaps

Margin Proposal Outline 09_08_2014 On September 2nd, the Federal banking regulators (OCC, Federal Reserve, FDIC, FCA and FHFA) issued a new rule proposal and request for comment on rules that would govern the posting of margin on non-cleared swaps.  The rules would apply, in pertinent part, to swap dealer banks (i.e, prudentially regulated banks that are registered as a swap dealer or a security-based … Continue Reading
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