SEC and CFTC Finalize Key Swap Product Definitions Under Dodd-Frank, Triggering the Effectiveness or Phase-In of Many Dodd-Frank Derivatives Regulatory Provisions
The SEC and CFTC recently approved joint final rules further defining the terms “swap,” “security-based swap,” “mixed swap,” and “security-based swap agreement” pursuant to the Dodd-Frank Act. These rules determine which derivative products will be subject to Title VII of the Dodd-Frank Act. The publication of these rules in the Federal Register—expected to occur in the near future—will trigger the effectiveness or the phase-in of many of the new derivatives regulations under Dodd-Frank such as reporting, recordkeeping, mandatory clearing, swap execution, business conduct and position limits. This Client Alert provides a preliminary look at these final definitional rules based on the fact sheets that have been made available by the SEC and the CFTC. A more detailed memo will follow upon the release of the text of these final rules.