Scribd
Upload
114 views1 page

Ucs Qa

The proposed rulemaking by the Commodity Futures Trading Commission implements section 724(c) of the Dodd-Frank Act regarding the protection of collateral for counterparties to uncleared swaps. The rules would apply to swap dealers and major swap participants and require them to notify counterparties of their right to require initial margin be segregated at an independent custodian. The rules do not require segregation of margin or address how much margin is required or what assets can be posted. Comments on the proposed rules are due within 60 days of publication in the Federal Register.

Uploaded by

Douglas Ashburn
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
114 views1 page

Ucs Qa

The proposed rulemaking by the Commodity Futures Trading Commission implements section 724(c) of the Dodd-Frank Act regarding the protection of collateral for counterparties to uncleared swaps. The rules would apply to swap dealers and major swap participants and require them to notify counterparties of their right to require initial margin be segregated at an independent custodian. The rules do not require segregation of margin or address how much margin is required or what assets can be posted. Comments on the proposed rules are due within 60 days of publication in the Federal Register.

Uploaded by

Douglas Ashburn
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 1

Commodity Futures Trading Commission

Office of Public Affairs


Three Lafayette Centre
1155 21st Street, NW
Washington, DC 20581
www.cftc.gov

Q & A – Protection of Collateral of Counterparties to Uncleared Swaps


What is the goal of the proposed rulemaking?

Section 724(c) of the Dodd-Frank Act amends the Commodity Exchange Act (CEA) by inserting a new section
4s(1), which requires that swap dealers and major swap participants notify their counterparties that such
counterparties have a right to require that any initial margin which they post to guarantee uncleared swaps be
segregated at an independent custodian. The goal of the proposed rulemaking is to implement that portion of the
statute by proposing rules concerning such notifications and such segregated accounts.

What registrants are covered by the proposed regulations?

The proposed regulations will apply to swap dealers and major swap participants.

By when must comments on the rules be submitted?

Comments on the rules must be submitted within sixty (60) days of the publication of the proposal in the Federal
Register.

Do the proposed rules require that margin be segregated?

No. The counterparty has the right to elect to require segregation of initial margin, but also may elect not to require
such segregation. The proposed regulations do require that the counterparty’s chief risk officer, chief executive
officer, or a similar high-level decisionmaker be advised of this right.

Do the proposed rules require address how much margin is required, or what assets a
counterparty may post as margin?

No. These rules only address the counterparty’s right to require segregation, and the requirements for segregated
accounts.

What other matters do the proposed rules address?

1) As required by Section 713(c) of the Dodd-Frank Act, the proposed rules clarify that securities held in a
portfolio margining account carried as a futures account are customer property and that the owners of those
accounts are customers for the purposes of the commodity broker provisions of the Bankruptcy Code.
2) The rulemaking changes certain time periods in its regulations concerning commodity broker bankruptcies
to seven calendar days to conform to Public Law 111-16, the Statutory Time-Periods Technical
Amendments Act of 2009.

Commodity Futures Trading Commission ♦ Office of Public Affairs ♦ 202-418-5080

You might also like