SR 13-12: Commodity Futures Trading Commission (CFTC) Swap Clearing Rules
On Friday, June 7, 2013, the Federal Reserve Board published SR Letter 13-12 as a reminder to supervised institutions that they need to consider new swap clearing rules developed by the CFTC. Section 723 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) added section 2(h) to the Commodity Exchange Act (CEA), which establishes a clearing requirement for swaps. The Dodd-Frank Act makes it unlawful for any person, including a financial institution, to engage in a swap, if the CFTC determines such swap is required to be cleared, unless the person submits the swap for clearing to a registered derivatives clearing organization (DCO).
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