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CFTC Seeking Comment on Overseas Impact in Swap-Collateral Rules 

September 19, 2014
Silla Brush, Bloomberg

The U.S. Commodity Futures Trading Commission has released revised collateral rules for swaps traded directly between banks, manufacturers and other firms while seeking comment on how to apply the regulations overseas.

The request for input on how to apply the rules to foreign banks and overseas units of U.S. firms came as CFTC members voted unanimously today to re-propose the collateral measure. The vote comes a day after a federal judge upheld the agency’s guidelines for how cross-border rules should be applied.

Trading that remains directly between two firms and outside of a clearinghouse “will continue to be an important part of the derivatives market,” CFTC Chairman Timothy Massad said at a meeting in Washington. “The importance of international harmonization cannot be understated,” he said, because “we do not want to create the potential for regulatory arbitrage in the market by creating unnecessary differences.”

Read more: Bloomberg

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