Cross-Border Representations To Address CFTC Swap Regulation

On July 26, 2013, the Commodity Futures Trading Commission (CFTC) published Interpretive Guidance and Policy Statement Regarding Compliance with Certain Swap Regulations (Guidance). The purpose of the Guidance is to help derivative market participants determine when the CFTC will assert jurisdiction over swap transactions that have a non-U.S. element. ISDA has prepared two status representation letters designed to permit counterparties to provide representations to each other. The deadline for providing counterparties with the appropriate representation letter is October 9, 2013.

The steps that need to be taken by October 9, 2013 are necessitated by a provision within Title VII of The Dodd–Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank), which states that U.S. derivatives reform under Dodd-Frank applies to any activity outside of the U.S. that has a "direct and significant" connection with, or effect on, U.S. commerce. Completion of the ISDA