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The Trading Mesh

#SEC adopts rules defining #OTC #swaps terms

Thu, 19 Apr 2012 15:14:32 GMT           

MoneyLack of regulation of the over-the-counter derivatives market trading activities has long been criticized as a major cause of the 2008 financial crisis. Regulators therefore have been under enormous pressure to set up checks and balances in those areas. And on April 18, the Securities and Exchange Commission (SEC) unanimously adopted a new rule to define a series of terms related to the over-the-counter swaps market.

The rules, written jointly with the Commodity Futures Trading Commission (CFTC), implement provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act that established a comprehensive framework for regulating derivatives.

“Adopting these entity definitions is a foundational step in the establishment of the new regime to regulate trading in this significant market,” said SEC Chairman Mary L. Schapiro. “These rules clarify for market participants whether their current activities will subject them to comprehensive oversight in the coming months.”

The final rule will become effective 60 days after the date of publication in the Federal Register.

To read more details about the new rules, please click here, here and here.

Come to the Trading Show Chicago 2012 event to hear regulators talking about the latest updates. Trading experts will come together to discuss how they can adapt and best compliance practices.

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