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SEC sets out registration exemptions

Friday 10 June 2011 - by Andrew Hickley


The Securities and Exchange Commission has proposed rules that would exempt central counterparties from registering trades in order to ease the clearing of transactions.

Without the changes, the purpose of clearing trades would be "impracticable and frustrate the purposes of the Dodd-Frank Act," the proposal states.

This is because each trade could have to be registered under requirements in the Securities Act, Exchange Act and Trust Indenture Act.

CCPs will still have to obey anti-fraud provisions under the Securities Act, however.

"Without an exemption, a clearing agency functioning as a CCP would be required to register the security-based swap transaction, which could unnecessarily impede the central clearing of security-based swaps," the proposal states.


"We believe that the proposed exemptions from the Securities Act, Exchange Act, and Trust Indenture Act are necessary to facilitate the intent of the Dodd-Frank Act with respect to mandatory clearing of security-based swaps."

The SEC has already brought in temporary exemptions for credit default swaps, which will now be made permanent.

Respondents have until 25 July to reply to the proposals, meaning these temporary rules will be extended beyond their current termination date of 16 July.

Send us your thoughts (in strict confidence) or submit an article in response:
Email: andrew.hickley@gfsnews.com




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