Latest updates

CFTC chair speaks at SIFMA annual meeting regarding ongoing work and rulemaking
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 09 November 2016

Timothy Massad, chair of the Commodity Futures Trading Commission (CFTC), recently spoke at the Securities Industry Financial Markets Association annual meeting about clearinghouse regulation, technological changes and finishing Dodd-Frank rulemaking. Massad also noted that the CFTC is considering lowering the de minimis threshold, and that it intends to re-propose rules on capital requirements for swap dealers and major swap participants.

CFTC expands interest rate swap clearing requirement
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 02 November 2016

The Commodity Futures Trading Commission recently expanded the existing clearing requirement to interest rate swaps through an amendment to Regulation 50.4(a), requiring that market participants submit a covered swap for clearing by a derivatives clearing organisation. The amendment expanded four interest rate swap classes to require clearing by a derivatives clearing organisation.

SEC proposes enhanced regulatory framework for covered clearing agencies
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 02 November 2016

The Securities and Exchange Commission (SEC) recently voted to establish enhanced standards for the operation and governance of securities clearing agencies that are deemed systemically important by the Financial Stability Oversight Council or that are involved in complex transactions. The SEC also voted to propose to apply the enhanced standards to other categories of securities clearing agency.

Time-limited no-action relief for swap execution facilities from certain block trade requirements
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 26 October 2016

The Commodity Futures Trading Commission (CFTC) Division of Market Oversight recently extended time-limited no-action relief to swap execution facilities from certain requirements in the definition of 'block trade' in CFTC regulations. Among other things, the extension will allow the division to continue to evaluate best practices and a more permanent solution to the issues involved in screening block trade orders for compliance with risk-based limits.

CFTC signs memorandum of understanding with UK Financial Conduct Authority
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 26 October 2016

The Commodity Futures Trading Commission recently announced that Chair Timothy Massad and Andrew Bailey, chief executive of the UK Financial Conduct Authority, have signed a memorandum of understanding regarding cooperation and the exchange of information in the supervision and oversight of certain regulated firms that operate on a cross-border basis in the United States and the United Kingdom.

CFTC announces rules for system safeguards and comparability determination for Japan's uncleared swap margin
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 19 October 2016

The Commodity Futures Trading Commission (CFTC) recently approved a final rule instituting system safeguards testing requirements for designated contract markets, swap execution facilities, swap data repositories and derivatives clearing organisations. In addition, the CFTC issued a comparability determination for Japan's margin requirements for uncleared swaps.

CFTC chair delivers keynote remarks at fourth annual OTC Derivatives Summit
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 19 October 2016

As part of his keynote remarks at the fourth annual Over-The-Counter Derivatives Summit, Commodity Futures Trading Commission Chair Timothy Massad addressed the commission's achievements in the past year. More specifically, Massad discussed the implementation of global rules setting margin for uncleared swaps and the de minimis threshold for swap dealers.

CFTC approves final rule to amend swaps reporting requirements for cleared swaps
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 20 July 2016

The US Commodity Futures Trading Commission recently approved a final rule to amend existing swaps reporting regulations in order to provide additional clarity to swap counterparties and registered entities regarding their reporting obligations for cleared swap transactions. The rule will become effective 180 days after it is published in the Federal Register.

CFTC proposes clearing requirement for additional interest rate swaps
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 20 July 2016

The US Commodity Futures Trading Commission (CFTC) recently proposed an amendment to CFTC Regulation 50.4(a) that would require certain additional interest rate swaps to be cleared by market participants through either a registered derivatives clearing organisation or a derivatives clearing organisation that has been exempted from registration under the Commodity Exchange Act.

CFTC extends no-action relief to swap execution facilities and designated contract markets
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 13 July 2016

The US Commodity Futures Trading Commission recently issued a no-action letter which provides relief to swap execution facilities and designated contract markets to correct clerical or operational errors that cause a swap to be rejected for clearing and thus become void, as well as errors discovered after a swap has been cleared.

SEC adopts final rule regarding trade acknowledgements
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 13 July 2016

The US Securities and Exchange Commission recently adopted a final rule requiring security-based swap dealers and major security-based swap participants to provide trade acknowledgements for security-based swap transactions. Covered entities are required to establish, maintain and enforce written policies and procedures that are reasonably designed to obtain prompt verification of the terms of all trade acknowledgements that they provide.

CFTC announces memorandum of understanding with ESMA regarding recognised central counterparties
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 29 June 2016

The US Commodity Futures Trading Commission recently announced the signing of a memorandum of understanding with the European Securities and Markets Authority (ESMA) regarding cooperation with respect to recognised central counterparties. Pursuant to the memorandum, derivatives clearing organisations established in the United States may apply to ESMA for recognition as central counterparties.

CFTC issues supplement modifying position limits proposal
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 22 June 2016

The US Commodity Futures Trading Commission (CFTC) recently issued for public comment a supplement to its position limits proposal of December 2013. The supplement would permit exchanges to recognise, subject to CFTC review, certain positions in commodity derivative contracts as non-enumerated bona fide hedges or enumerated anticipatory bona fide hedges, as well as to exempt certain spread positions from federal position limits.

Final cross-border margin rule issued
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 15 June 2016

The Commodity Futures Trading Commission (CTFC) has issued a rule implementing a cross-border approach to its margin requirements for uncleared swaps. The CFTC's margin rule applies to CFTC-registered swap dealers and major swap participants for which there is no prudential regulator, but these rules are closely aligned with the cross-border margin requirements already adopted by the prudential regulators.

CFTC approves final rule on amendments to swap portfolio reconciliation requirement
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 08 June 2016

The US Commodity Futures Trading Commission (CFTC) recently approved a final rule to amend a requirement in CFTC Regulation 23.500(i) that swap dealers and major swap participants exchange the terms of swaps with their counterparties for portfolio reconciliation. The final rule also amends the definition of 'material terms' in CFTC Regulation 23.500(g).

CFTC signs memorandum of understanding with Canadian provinces on cross-border supervision
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 01 June 2016

The CFTC chairman Timothy Massad and authorities for three Canadian provinces recently signed a March 2014 memorandum of understanding. It concerned cooperation and coordination between the jurisdictions with respect to derivatives and securities markets, as well as the supervision and oversight of regulated entities that operate on a cross-border basis in the United States and Canada.

Business conduct standards for security-based swap deals and major security-based swap participants
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 11 May 2016

On April 15 2016 the US Securities and Exchange Commission (SEC) – in its ongoing effort to regulate the over-the-counter security-based swap markets – adopted final rules under Title VII of the Dodd-Frank Act­­ implementing comprehensive business conduct standards and chief compliance officer requirements for security-based swap dealers and major security-based swap participants.

CFTC staff provides relief in connection with swap trade confirmations
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 04 May 2016

The Commodity Futures Trading Commission (CFTC) Division of Market Oversight has issued a no-action letter extending the period for relief from the requirement in CFTC Regulation 37.6 that a swap execution facility obtain documents incorporated by reference in a trade confirmation issued by the swap execution facility before issuing the confirmation.

CFTC approves final rule to amend trade option exemption
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 27 April 2016

The Commodity Futures Trading Commission (CFTC) has approved a final rule that removes certain reporting and record-keeping requirements for trade option counterparties that are neither swap dealers nor major swap participants. The final rule eliminates the Form TO annual notice reporting requirement for otherwise unreported trade options in CFTC Regulation 32.3(b).

Authorities adopt determinations on supervision of CCPs
Shearman & Sterling LLP
  • Derivatives
  • USA
  • 20 April 2016

The European Commission has published its equivalence decision on the derivatives regulatory regimes for derivatives clearing organisations in the United States. The decision followed the announcement by the Commodity Futures Trading Commission and the European Commission of a common approach on the supervision of central clearing counterparties operating in the United States and the European Union.

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