security-based swap

SEC Adopts Amendments Providing Authorities Access to Data Obtained by Security-Based Swap Data Repositories


On August 29, 2016, the Securities and Exchange Commission amended a rule designed to provide access for regulators to data in the security-based swap market.  The amendments were enacted to make the sharing of information more secure and efficient. Press release,

SEC Adopts Trade Acknowledgment and Verification Rules for Security-Based Swap Transactions

On June 8, 2016, the Securities and Exchange Commission publicized the implementation of “rules that will establish timely and accurate trade acknowledgment and verification requirements for security-based swap (SBS) entities that enter into SBS transactions.”  Press release.

The SEC Adopts Cross-Border Security-Based Swap Rules

On February 10, the Securities and Exchange Commission (the “SEC”) adopted rules under the Dodd-Frank Wall Street Reform and Consumer Protection Act to regulate both U.S. and foreign dealers who engage in security-based swap dealing activities in the U.S. The rules require non-U.S. companies to include certain transactions in their determinations of whether such companies are subject to registration as security-based swap dealers. The final rules will take effect 60 days after publication in the Federal Register, but compliance is not required until 1 year after the publication or the SBS Entity Counting Date, whichever comes later. Press release.

SEC Extends Expiration Dates to Interim Final Rules Providing Exemptions for Certain Security-Based Swaps

On February 5, the SEC adopted amendments to the expiration dates in its interim final rules that provide exemptions under the securities laws for certain security-based swaps. Under the amendments, the expiration dates in the interim final rules will be extended to February 11, 2017Release.

SEC Rules for Derivative Regulation

The SEC, on July 6, and the CFTC, on July 10, approved rules and interpretations for key definitions of certain derivatives products. The SEC rules and interpretations further define the terms “swap” and “security-based swap” and whether a particular instrument is a “swap” regulated by the CFTC or a “security-based swap” regulated by the SEC. The action also addresses “mixed swaps,” which are regulated by both agencies, and “security-based swap agreements,” which are regulated by the CFTC but over which the SEC has antifraud and other authority. The rules will be effective 60 days after publication in the Federal Register. However, solely for the purposes of certain interim relief granted and exemptions adopted under the Securities Act of 1933, the Securities and Exchange Act of 1934, and the Trust Indenture Act of 1939, the compliance date for the final rules further defining the term “security-based swap” will be 180 days after the publication in the Federal Register. SEC Release. CFTC Meeting Notice.

SEC Steps to Address Effective Date of Title VII of Dodd-Frank

On June 10, the SEC announced that it will take certain steps to clarify requirements applicable to security-based swap transactions as of July 16, which is the effective date of Title VII of the Dodd-Frank Act (which authorizes the SEC to regulate security-based swaps). These actions include providing temporary relief from certain provisions of Title VII, as well as from various pre-Dodd-Frank provisions of the Exchange Act. SEC Release.

CFTC and SEC Proposed Rules and Guidance for Swap Definitions

On April 27, pursuant to Sections 712 and 721 of the Dodd-Frank Act, the CFTC and SEC issued proposed rules that would further define the terms swap, security-based swap, and security-based swap agreement. The proposed rules also would adopt regulations regarding mixed swaps as well as books and records for security-based swap agreements. During the April 27 Open Meeting in which the CFTC approved the proposed rules, the Commissioners observed four different approaches between the SEC and CFTC: (i) the inclusion of anti-evasion provisions in the proposed rules; (ii) the treatment of insurance on swaps as a securities-based swap; (iii) treatment of swaps linked to futures for foreign sovereign debt securities; and (iv) the jurisdiction and applicable regulatory requirements of the CFTC over indexed credit default swaps. Comments must be submitted within 60 days after publication in the Federal Register. SEC Release. CFTC Fact Sheet. CFTC Open Meeting Webcast.

Rule on End-User Notification Requirements

On December 15, in accordance with the Dodd-Frank Act, the SEC proposed a rule to specify the steps that end-users must follow to notify the SEC of how they meet their financial obligations when engaging in a security-based swap transaction that is exempt from mandatory clearing. SEC Release. Proposed Rule.

SEC/CFTC ANPR: Dodd-Frank Act, Title VII Definitions

On August 13, the Fed and the CFTC issued an advance notice of proposed rulemaking to solicit comments on how to define key terms in connection with swaps and security-based swaps and as to regulations to be prescribed regarding “mixed swaps”, as required under Section VII of the Dodd-Frank Act.  Comments must be received no later than 30 days after publication of the ANPR in the Federal Register. ANPR.