CFTC Adopts Final Rules and Interpretations Further Defining Products and Final End-User Clearing Exception Rule; Proposes Clearing Exception for Swaps Entered into by Certain Cooperatives

The Commodity Futures Trading Commission held an open meeting yesterday, July 10, 2012, to consider Final Rules and Interpretations (i) further defining the terms “swap,” security-based swap,” “security-based swap agreement,”(ii) regarding mixed swaps, and (iii) governing books and records for security-based swap agreements (the “Final Product Rules”) pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act. The CFTC promulgated the Final Product Rules jointly with the Securities and Exchange Commission. The CFTC also voted to adopt the Final Rule on End-User Exception to Mandatory Clearing of Swaps (the “Final End-User Exception”). Finally, the CFTC issued a proposed rule to exempt from the mandatory clearing requirement, certain swaps executed by cooperatives that are financial entities with assets in excess of $10 billion (“Proposed Rule”).

Although the text of the Final Rules and Proposed Rule are not yet available, below is a summary of the main provisions based primarily on the fact sheets issued by the CFTC and the discussions at the CFTC Open Meeting yesterday. read more

Get more information on the CFTC’s July 10 meeting and download related documents by visiting the CFTC’s website.

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