The CFTC Amends Cleared Swap Recordkeeping And Reporting Rules

On June 14, 2016, the CFTC adopted amendments to existing swap data reporting rules related to cleared swaps transactions. The rule amendments attempt to reconcile existing regulations with the realities of market activity.

Specifically, the rules now define two terms – an "original" or "alpha" swap, which is a swap that has been accepted for clearing by a derivatives clearing organization ("DCO"), and a "clearing" swap, also referred to as beta or gamma swap, which is a swap created by the DCO which has the DCO as a counterparty, whether or not they replace the clearing swap.

Under the rule amendments, the DCO will be the reporting counterparty for cleared swaps and will have the obligation to report creation data for each clearing swap.