Alert August 17, 2010

SEC and CFTC Seek Comment on Key Definitions in Dodd-Frank Act Derivatives Regulation Scheme

The SEC published a joint advance notice of proposed rulemaking requesting comment from interested parties on rulemaking by the agencies to further define certain key definitions that are part of the comprehensive scheme for regulating swaps and security-based swaps set forth in the Wall Street Transparency and Accountability Act of 2010, Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”).  The SEC has requested public comment on other rulemaking and studies required by the Dodd-Frank Act, as discussed in the August 3, 2010 Alert.  The key definitions at issue are the definitions of “swap,” “security-based swap,” “swap dealer,” “security-based swap dealer,” “major swap participant,” “major security-based swap participant,” “eligible contract participant,” and “security-based swap agreement.”  The two agencies have also solicited comment on the regulations regarding “mixed swaps” that Title VII requires them to jointly prescribe.  For further discussion of Title VII of the Dodd-Frank Act, please see the August 2, 2010 Special Edition of the Alert.