Alert May 03, 2011

CFTC Proposes Rules Establishing Margin Requirements for Uncleared Swaps for Swap Dealers and Major Swap Participants

The CFTC issued a proposal that would adopt capital and initial and variation margin requirements for certain swap dealers (“SDs”) and major swap participants (“MSPs”). The proposed rules would not impose margin requirements on nonfinancial end users.  The CFTC stated that it will propose rules regarding capital requirements for SDs and MSPs at a later date and intends to align the comment periods of these two proposals so that commenters will have an opportunity to review each before commenting on either.  Comments on the current proposal are due by June 27, 2011.