2018-10995: Margin Requirements for Uncleared Swaps for Swap Dealers and Major Swap Participants

Summary

The Commodity Futures Trading Commission ("Commission" or "CFTC") is seeking comment on proposed amendments to the margin requirements for uncleared swaps for swap dealers ("SD") and major swap participants ("MSP") for which there is no prudential regulator ("CFTC Margin Rule"). The Commission is proposing these amendments in light of the rules recently adopted by the Board of Governors of the Federal Reserve System ("Board"), the Federal Deposit Insurance Corporation ("FDIC"), and the Office of the Comptroller of the Currency ("OCC") (collectively, the "QFC Rules") that impose restrictions on certain uncleared swaps and uncleared security-based swaps and other financial contracts. Specifically, the Commission proposes to amend the definition of "eligible master netting agreement" in the CFTC Margin Rule to ensure that master netting agreements of firms subject to the CFTC Margin Rule are not excluded from the definition of "eligible master netting agreement" based solely on such agreements' compliance with the QFC Rules. The Commission also proposes that any legacy uncleared swap (i.e., an uncleared swap entered into before the applicable compliance date of the CFTC Margin Rule) that is not now subject to the margin requirements of the CFTC Margin Rule would not become so subject if it is amended solely to comply with the QFC Rules. These proposed amendments are consistent with proposed amendments that the Board, FDIC, OCC, the Farm Credit Administration ("FCA"), and the Federal Housing Finance Agency ("FHFA" and, together with the Board, FDIC, OCC, and FCA, the "Prudential Regulators"), jointly published in the Federal Register on February 21, 2018.

The agency’s own summary, as published.

What this changes

Amends 1 part of the Code of Federal Regulations — the standing rules this notice rewrites.

• 17 CFR 23 Swap Dealers and Major Swap Participants