Trade Associations Recommend Changes To CFTC Cross-Border Swap Dealing Proposal

SIFMA, IIB, ISDA, and FIA recommended changes to CFTC-proposed cross-border regulations concerning registration thresholds and certain requirements applicable to swap dealers and major swap participants.

As previously covered, the CFTC proposal would, among other things: (i) add a new definition of "U.S. person" intended to be harmonized with SEA Rule 3a71-3; (ii) significantly change the counting requirements for non-U.S. subsidiaries of U.S. firms, including by adding a new category called "significant risk subsidiary"; (iii) provide "full relief" for transactions "arranged, negotiated or executed" in the United States by non-U.S. persons; (iv) add a definition of "guarantee" that requires the "explicit recourse" of a counterparty to a U.S. person; and (v) revise the standards for substituted compliance determinations.