UK:
US Corporate Law News: CFTC Sets Threshold For Swap-Dealer Registration At $8 Billion
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On June 4, 2018, the Commodity Futures Trading Commission (CFTC) voted 2-1 in favor of permanently
increasing the threshold for swap-dealer registration at $8 billion
in annual notational value. The vote avoids a return to the prior
threshold amount of $3 billion scheduled to be effective at the end
of 2019. The permanent change is intended to eliminate burdens for
non-financial companies that transact in relatively small amounts
of swap dealing as a means to hedge against certain business risks.
Under prior regulations, CFTC staff
estimated that 229 entities would be subject to swap-dealer
registration, though under the new permanent threshold, only 145
entities are affected. Companies seek to avoid swap dealer
registration due to cost-prohibitive margin and capital
requirements. CFTC must now finalize the
rule before the end of the year so that market participants can
begin tracking their swap-dealing activities on January 1, 2019.
For more information, please see https://www.cftc.gov/PressRoom/SpeechesTestimony/giancarlostatement060418
The content of this article is intended to provide a general
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