Alert February 12, 2013

SEC Extends Securities Law Exemptions For Security-Based Swaps

The SEC adopted amendments to the expiration dates of certain interim final rules adopted in July 2011 (that were described in the July 5, 2011 Financial Services Alert).  The interim final rules provide exemptions under the Securities Act of 1933, the Securities Exchange Act of 1934, and the Trust Indenture Act of 1939 to security-based swaps that were security-based swap agreements prior to the effective date of Title VII of the Dodd-Frank Act.  Because the Dodd-Frank Act defines security-based swap agreements as “securities,” such instruments would have become subject to various requirements applicable to securities in the absence of the interim final rules.  The interim final rules, however, generally exempt such instruments from the requirements of the relevant statutes, other than certain anti-fraud provisions.  The interim final rules were originally scheduled to expire on February 11, 2013.  The amendments extend the expiration date to February 11, 2014.