Alert July 05, 2011

SEC Approves Extension of Temporary Exemptions for Eligible Credit Default Swaps to Facilitate Operation of Central Counterparties to Clear and Settle Credit Default Swaps

The SEC extended the expiration dates in temporary rules that provide exemptions under the Securities Act of 1933, the Securities Exchange Act of 1934, and the Trust Indenture Act of 1939 for certain credit default swaps in order to continue facilitating the operation of one or more central counterparties for those credit default swaps as the SEC considers rulemaking that implements the clearing provisions of the Dodd-Frank Act.  The extension of the expiration dates until April 16, 2012 is effective upon publication in the Federal Register.  If the SEC adopts permanent exemptions for security-based swaps issued by certain clearing agencies before April 16, 2012, it will terminate the effectiveness of the temporary rules as part of that rulemaking.