Yesterday the CFTC issued a proposed rule relating to the application of key aspects of US swaps rules - relating to registration thresholds and business conduct standards - to cross-border transactions. In light of Chairman Massad's prior comments, the focus on cross border rules was expected.
The U.S. Commodity Futures Trading Commission (Commission) today voted unanimously to propose rules and interpretations addressing the application of certain swap provisions of the Commodity Exchange Act (CEA) and Commission regulations to cross-border transactions (Proposed Rule). The proposal defines key terms for cross-border transactions and addresses the cross-border application of the registration thresholds and external business conduct standards for swap dealers and major swap participants. It also addresses whether and to what extent these thresholds and standards would apply to swap transactions that are arranged, negotiated, or executed using personnel located in the United States (ANE transactions). The unanimous vote was conducted via seriatim. The comment period ends 60 days after publication of the proposal in the Federal Register. The Commission expects to address the cross-border application of other swap requirements, including their application to ANE transactions, in subsequent rulemakings.