Corporate & Financial Weekly Digest

Corporate & Financial Weekly Digest

CFTC Takes Action on Rules Relating to Swaps and Swap Execution Facilities

Posted in CFTC

On November 5, the Commodity Futures Trading Commission held an open meeting to consider the following matters relating to swaps and swap execution facilities:

  • Final Rule: Amending the De Minimis Exception to the Swap Dealer Definition
  • Proposed Rule: Amendments to Regulations on Swap Execution Facilities and Trade Execution Requirement
  • Request for Comment Regarding the Practice of “Post-Trade Name Give-Up” on Swap Execution Facilities

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FCA Publishes Speech on Brexit Preparations

Posted in Brexit/UK Developments, Financial Markets

On November 5, the UK Financial Conduct Authority (FCA) published a speech by Nausicaa Delfas, FCA Executive Director of International, on Brexit and maintaining market confidence.

The speech covers a wide range of Brexit topics and provides an overview of the FCA’s current priorities relating to Brexit, including its work to ensure there is a robust regulatory framework on exit day, if the United Kingdom leaves the European Union without an agreed transition period (No-Deal Brexit). Ms Delfas sheds light on the temporary permissions regime being implemented in the case of a No-Deal Brexit, stating that 1,300 EU-based firms and funds have expressed an interest in the regime. The temporary permissions regime will allow EU firms and funds to continue regulated business in the United Kingdom in the case of a No-Deal Brexit (for further details, see the July 27 edition of Corporate & Financial Weekly Digest). Continue Reading

EEA Passport Rights Regulations 2018 Published

Posted in Brexit, EU Developments, Financial Markets

On November 7, the European Economic Area (EEA) Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018 (Passport Rights Regulations) were published together with an associated explanatory memorandum. Continue Reading

ESAs Publish Consultation Paper Relating to MLD4

Posted in EU Developments, Financial Markets

On November 8, the Joint Committee of the European Supervisory Authorities (ESAs) published a consultation paper on draft joint guidelines on cooperation and information exchange between national competent authorities (NCAs) supervision credit and financial institutions for the purposes of the Fourth Money Laundering Directive (MLD4) Continue Reading

ESMA Proposes Regulatory Change To Support the Brexit Preparations of Counterparties to Uncleared OTC Derivatives

Posted in Brexit, EU Developments, Financial Markets

On November 8, the European Securities and Markets Authority (ESMA) published a final report proposing new draft regulatory technical standards (RTS) contained in a draft Delegated Regulation that would amend the three European Commission Delegated Regulations on the clearing obligation under the European Markets and Infrastructure Regulation (EMIR). Continue Reading

SEC Issues Statement on Swap Business Conduct Rules

Posted in Derivatives

On October 31, the Securities and Exchange Commission took an unusual additional step towards implementing its rules for security-based swaps (SBS) by issuing a document entitled “Commission Statement on Certain Provisions of Business Conduct Standards for Security-Based Swap Dealers and Major Security-Based Swap Participants.” The novelty of the Statement is that it amounts to a promise of five years of future no-action relief from enforcement after implementation of the SBS rules for any SBS Entity (as defined below) that chooses to follow certain Commodity Futures Trading Commission external business conduct rules for its SBS trading instead of complying with the SEC’s analogous (but slightly different) business conduct rules for SBS. An SBS Entity is any entity that is registered with the SEC as either (1) an SBS dealer or (2) a major SBS participant. Continue Reading

CFTC Issues No-Action Relief Regarding FCM’s Deposit of Customer-Owned Securities

Posted in CFTC

On October 31, the Division of Swap Dealer and Intermediary Oversight (DSIO) of the Commodity Futures Trading Commission issued Letter No. 18-26 to provide continuing relief to a futures commission merchant (FCM) from certain requirements regarding the holding of customer-owned securities as margin for trading on foreign futures and foreign options markets. This letter supersedes CFTC Letter No. 16-88 and was issued to address certain changes in European law with regard to the clearing of positions of clearing members’ indirect clients. Continue Reading

CFTC’s Office of the Chief Economist Issues Report on Initial Margin Phase 5

Posted in CFTC

On October 31, the Commodity Futures Trading Commission’s Office of the Chief Economist issued a report on “Phase 5” of the uncleared margin rules (UMR). The purpose of the report is to provide a guide to regulators in their responses to requests for relief from various industry representatives. Continue Reading

Banking Regulators Propose Revised Methodology for Calculating Derivatives Exposure

Posted in Banking, Derivatives

The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency (the agencies) are inviting public comment on a proposal that would implement a new approach for calculating the exposure amount of derivative contracts under the agencies’ regulatory capital rule. Continue Reading

Bank of England and PRA Publish Brexit Package of Consultations and Communications

Posted in Brexit, Financial Markets, UK Developments

On October 25, the Bank of England (BoE) and the UK Prudential Regulation Authority (PRA) published a package of Brexit-related communications and consultation papers which propose changes to the relevant onshored binding technical standards (BTS), the rules for financial market infrastructure providers (FMIs) and the PRA Rulebook, which arise from the UK’s withdrawal from the European Union. Continue Reading