The Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission published the final rules defining “swap” and other swap-related terms in the Federal Register earlier this week, setting into motion a countdown to compliance for a number of CFTC regulations governing the swap market. From law firm Skadden Arps:
“The effective date and compliance date for the Final Rules, and the interpretations contained therein, is 60 days following their publication in the Federal Register, with two exceptions. First, the compliance date for the CFTC’s interpretation regarding guarantees of swaps will be defined in a subsequent rulemaking. Second, solely for purposes of the July 7, 2011, SEC order granting temporary exemptions to security-based swaps from certain Exchange Act provisions, the compliance date for the Final Rules further defining ‘security-based swap’ will be 180 days following publication in the Federal Register. Once the compliance date kicks in for these rules further defining ‘security-based swap,’ the SEC order’s temporary exemptions for security-based swaps will expire.”
For your reference, here’s a roundup of legal updates on the topic (we will continue to add commentary as it comes in):
CFTC and SEC Adopt Rules Defining ‘Swap’ and ‘Security-Based Swap’ (Skadden, Arps, Slate, Meagher & Flom LLP):
“As amended, the [Commodity Exchange Act ] defines swaps broadly to include ‘any agreement … that provides on an executory basis for the exchange … of 1 or more payments based on the value or level of 1 or more … rates, currencies, commodities, securities, instruments of indebtedness, indices, quantitative measures, or other financial or economic interests or property of any kind … and that transfers, as between the parties to the transaction, in whole or in part, the financial risk associated with a future change in any such value or level without also conveying a current or future direct or indirect ownership interest in an asset (including any enterprise or investment pool) or liability that incorporates the financial risk so transferred.’ This broad statutory definition is subject to numerous exclusions.” Read on>>
CFTC Starts Dodd-Frank Compliance Countdown for Energy Companies (Leonard, Street and Deinard):
“The term ‘swap’ broadly includes any contract that provides for an exchange of payments based on the value of commodities or other items and that transfers the financial risk associated with future changes in such values without also conveying an ownership interest in the underlying asset. ‘Swaps’ include options, commodity swaps, energy swaps, basis swaps, emission swaps and weather swaps. An important exception excludes ‘forward contracts’ in physical commodities, so long as such contracts are intended to be physically settled at the time of execution.” Read on>>
Publication of “Swap” Definition Triggers Dodd-Frank Derivatives Reform Compliance Dates (Sutherland Asbill & Brennan LLP):
“The joint final rules, which were adopted by the CFTC on July 10, will become effective on October 12, 2012. These rules are a key component of the new regulatory regime imposed on the over-the-counter derivatives market by the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). Publication of the joint final rules in the Federal Register triggers the compliance dates for a number of CFTC final rules.” Read on>>
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Related analysis:
- CFTC Effective Dates Timeline for Swaps Rules – Skadden, Arps, Slate, Meagher & Flom LLP
- Publication of “Swap” Definition Finalizes Compliance Dates - Leonard, Street and Deinard
- CFTC Takes Steps to Implement the Clearing Regime for Swaps and Finalizes the Exception From Clearing for Commercial End-Users – Skadden, Arps, Slate, Meagher & Flom LLP
- Public Company Board Approval for Uncleared Swaps – Leonard, Street and Deinard
- End-User Recordkeeping and Reporting Requirements under Dodd-Frank – McDermott Will & Emery
- Operators of, and Advisers to, New Private Funds Have Until December 31 2012, to Register with the CFTC – Sutherland Asbill & Brennan LLP
- ICE Moving Cleared Energy Swaps to Futures – Leonard, Street and Deinard
- CFTC Issues Temporary No-Action Relief from Aggregation Requirements of Position Limits Rule – Katten Muchin Rosenman LLP
- CFTC Rule 1.73: Jim Downs of Connamara Systems Talks About Little Known Options Rule [VIDEO] – MarketsReformWiki
- CFTC Withdraws and Re-Issues Proposed Ownership and Control Reports Rule – Katten Muchin Rosenman LLP
- Power Struggle? The CFTC/FERC Jurisdictional Split under Dodd-Frank – K&L Gates LLP
- CFTC Approves Swap Transaction Compliance and Implementation Schedule Rule – Katten Muchin Rosenman LLP
- CFTC No-Action on Aggregation Requirements for Futures and Swaps – Orrick
- CFTC Proposes Clearing Determination for Credit Default and Interest Rate Swaps – Katten Muchin Rosenman LLP
- CFTC and SEC Adopt Final Rules Defining Swaps – Proskauer Rose LLP
- CFTC Designates Provider of Legal Entity Identifiers – Katten Muchin Rosenman LLP
- CFTC Final Regulations on Phase in Compliance with Clearing Requirements and Proposed Rule on Clearing Determination – Orrick
- Exemptive Order Regarding Compliance With Certain Swap Regulations – White & Case LLP
- Dodd-Frank Final Derivatives Product Definition Rules – Lowenstein Sandler PC
- CFTC Publishes Proposed Interpretative Guidance With Respect to the Cross-Border Application of Certain Swaps Provisions of the Commodity Exchange Act – White & Case LLP
- CFTC Proposes Clearing Determination for Credit Default Swaps and Interest Rate Swaps – Leonard, Street and Deinard
- CFTC Approves Regulations to Phase in Clearing Requirements – Leonard, Street and Deinard
- CFTC’s Division of Swap Dealer and Intermediary Oversight Issues Time-Limited No-Action Relief to Certain CPOs and CTAs to Meet Registration and Compliance Obligations – Katten Muchin Rosenman LLP
- DTCC-SWIFT to Provide Legal Entity Identifiers for Swap Transactions – Leonard, Street and Deinard
- CFTC Issues Temporary No-Action Relief For Non-Clearing Swap Dealers – Katten Muchin Rosenman LLP
- CFTC Swap No-Action Relief for Registration and Compliance – Orrick
- CFTC Finalizes Commercial End-User Exception – Morgan Lewis
- CFTC Staff Extends Registration and Compliance Date For CPOs and CTAs Impacted By 4.13(a)(4) and 4.5 Amendments – Skadden, Arps, Slate, Meagher & Flom LLP
- Dodd-Frank Act Derivatives Provisions for End Users as of July 16, 2012 – McDermott Will & Emery
- CFTC and SEC Adopt Further Definitions of Swap and Related Key Terms – Katten Muchin Rosenman LLP
- CFTC Extends Compliance Date Regarding Rescission of CPO/CTA Registration Exemptions, but Not for Swaps – K&L Gates LLP
- CFTC Adopts End-User Exception and Proposes Exemption from the Swap Clearing Requirement for Certain Cooperatives – Katten Muchin Rosenman LLP
- CFTC, SEC Approve Final Rules To Define “Swap”; CFTC Exempts Small Banks From Clearing Requirements – BuckleySandler LLP
- CFTC Proposes Guidance on the Cross-Border Impact of Dodd-Frank’s Swap Regulations – Skadden, Arps, Slate, Meagher & Flom LLP
- SEC Rules for Derivative Regulation – Orrick
- CFTC Issues No-Action Relief Extending Compliance Date for Amended Rules 4.5 and 4.13(a)(4) to December 31, 2012 – Dechert LLP
- CFTC Issues Pre-Publication Copy of Final Product Definitions – Sutherland Asbill & Brennan LLP
- CFTC Approves Final Rule on End-User Exception – Leonard, Street and Deinard
- CFTC and SEC Finally Issue Product Definitions – Sutherland Asbill & Brennan LLP
- CFTC Finalizes the End-User Exception from Mandatory Clearing and Proposes to Extend It to Certain Cooperatives – Sutherland Asbill & Brennan LLP
- CFTC Definition of “Swap” Addresses “Forward Contract Exclusion” – Leonard, Street and Deinard
- The CFTC’s Proposed Guidance on Cross-Border Swap Regulation and Proposed Exemptive Order – Katten Muchin Rosenman LLP
- SEC holds meeting to approve rules with respect to certain key product definitions – White & Case LLP
- CFTC Approval of Phased Compliance for Swap Regulations – Orrick, Herrington & Sutcliffe LLP
- CFTC Final Order on the Effective Date for Swap Regulation – Orrick, Herrington & Sutcliffe LLP
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