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Proposed Rule

Reopening and Extension of Comment Periods for Rulemakings Implementing the Dodd-Frank Wall Street Reform and Consumer Protection Act

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Information about this document as published in the Federal Register.

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AGENCY:

Commodity Futures Trading Commission.

ACTION:

Reopening and extension of comment periods.

SUMMARY:

Since the enactment of the Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) on July 21, 2010, the Commodity Futures Trading Commission (“Commission”) has published in the Federal Register a significant number of notices of proposed rulemaking to implement the provisions of the Dodd-Frank Act that establish a comprehensive new framework for the regulation of swaps. In order to provide interested parties with an additional opportunity to participate in these Dodd-Frank Act rulemakings and comment on the proposed new regulatory framework, the Commission is reopening or extending the comment period for many of its proposed rulemakings. The Commission is also requesting comment on the order in which it should consider final rulemakings made under the Dodd-Frank Act.

DATES:

For those rulemakings listed herein for which the comment period has closed at the time of publication of this notice, the comment period is re-opened until June 3, 2011. For those rulemakings listed herein for which the comment period closes during the extension's comment period, the comment period is extended until June 3, 2011. The comment period of any rulemaking subject of this extension that closes after the extension's comment period shall remain open until the originally published closing date. All comments that were received after the close of the originally established comment period of each of the reopened rulemakings will be treated as if they were received during the reopened comment periods and need not be resubmitted.

The comment period regarding the order in which the Commission should consider final rules will be open until June 3, 2011.

ADDRESSES:

Comments may be submitted by any of the following methods:

  • Agency Web site, via its Comments Online process at http://comments.cftc.gov. Follow the instructions for submitting comments through the Web site, and submit all comments through the “submit comment” link associated with this extension.
  • Mail: Send to David A. Stawick, Secretary, Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st Street, NW., Washington, DC 20581.
  • Hand Delivery/Courier: Same as mail above.

Please submit your comments using only one method. You may submit comments on individual rulemakings subject of this extension, on the intersection of more than one rulemaking, or on the proposed rulemakings from a global perspective. Comments may be submitted on any individual rulemaking, on any combination of rulemakings, or on the order and timing of the Commission's final rulemakings, including the effective and compliance dates that may be appropriate for the various rulemakings.

To ensure that your comments are considered to the fullest extent possible by the Commission, you should identify each of the proposed rulemakings to which your comment applies by providing the name and RIN number associated with each rulemaking. Rulemaking RIN numbers may be found on the Commission's Web site at http://comments.cftc.gov/​PublicComments/​ReleasesWithComments.aspx. Comments that address the rulemakings from a global perspective should be identified with the phrase “global comment” in the subject line. Additionally, as provided above, all comments submitted through the Commission's Comments Online process should be transmitted via the “submit comment” link associated with this rulemaking. You need not, and to ensure that all comments addressing more than one rulemaking are Start Printed Page 25275considered fully by the Commission you should not, submit comments addressing more than one rulemaking to any of the individual rulemakings listed on the Commission's “public comments” or “open comment periods” Web pages.

All comments must be submitted in English, or if not, accompanied by an English translation. Comments will be posted as received to http://www.cftc.gov. You should submit only information that you wish to make available publicly. If you wish the Commission to consider information that may be exempt from disclosure under the Freedom of Information Act, a petition for confidential treatment of the exempt information may be submitted according to the procedures established in § 145.9 of the Commission's regulations, 17 CFR 145.9.

The Commission reserves the right, but shall have no obligation, to review, pre-screen, filter, redact, refuse or remove any or all of your submission from http://www.cftc.gov that it may deem to be inappropriate for publication, such as obscene language. All submissions that have been redacted or removed that contain comments on the merits of the rulemaking will be retained in the public comment file and will be considered as required under the Administrative Procedure Act and other applicable laws, and may be accessible under the Freedom of Information Act.

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FOR FURTHER INFORMATION CONTACT:

On this release, Beverly E. Loew, Assistant General Counsel, Office of the General Counsel, Commodity Futures Trading Commission, 1155 21st Street, NW., Washington, DC 20581; 202-418-5648; or bloew@cftc.gov. On any particular rulemaking, the Commission staff members listed in the associated notice of proposed rulemaking.

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SUPPLEMENTARY INFORMATION:

I. Background

President Obama signed the Dodd-Frank Act on July 21, 2010.[1] Title VII of the Dodd-Frank Act [2] amended the Commodity Exchange Act (“CEA”) [3] to establish a comprehensive new regulatory framework for swaps and security-based swaps. The legislation was enacted to reduce risk, increase transparency, and promote market integrity within the financial system by, among other things: (1) Providing for the registration and comprehensive regulation of swap dealers and major swap participants; (2) imposing clearing and trade execution requirements on standardized derivative products; (3) creating robust recordkeeping and real-time reporting regimes; and (4) enhancing the Commission's rulemaking and enforcement authorities with respect to, among others, all registered entities and intermediaries subject to the Commission's oversight.

Over the past several months the Commission has proposed a number of rulemakings to implement the Dodd-Frank Act. With respect to these rulemakings, the Commission has consulted and coordinated with the Securities and Exchange Commission and other Federal regulators, held hundreds of meetings with market participants and other members of the public interested in the proposed rulemakings, and received thousands of comments on these proposed rulemakings. At this point, the regulatory requirements that have been proposed by the Commission present a substantially complete mosaic of the Commission's proposed regulatory framework for swaps under the Dodd-Frank Act.

II. Reopening and Extension of Comment Periods and Request for Comment

In light of this substantially complete mosaic, the Commission is reopening or extending the comment period of many of its proposed rulemakings in order to provide the public with an additional opportunity to comment on the proposed new regulatory framework for swaps, either in part or as a whole.

The Commission also specifically seeks comments on the costs and benefits of the proposed rulemakings, individually, in combination, or globally. In particular, the Commission reiterates its request for additional quantitative or qualitative information relating to the costs and benefits of the proposed rules.

The comment periods for the following rulemakings are being extended:

ProposedTitle of rulemakingClosed
10/14/2010Financial Resources Requirements for Derivatives Clearing Organizations12/13/2010
10/18/2010Requirements for Derivatives Clearing Organizations, Designated Contract Markets, and Swap Execution Facilities Regarding the Mitigation of Conflicts of Interest11/17/2010
10/26/2010Agricultural Commodity Definition11/26/2010
11/2/2010Process for Review of Swaps for Mandatory Clearing1/3/2011
11/3/2010Investment of Customer Funds and Funds Held in an Account for Foreign Futures and Foreign Options Transactions12/3/2010
11/17/2010Implementation of Conflicts of Interest Policies and Procedures by Futures Commission Merchants and Introducing Brokers1/18/2011
11/19/2010Registration of Foreign Boards of Trade1/18/2011
11/19/2010Designation of a Chief Compliance Officer; Required Compliance Policies; and Annual Report of a Futures Commission Merchant, Swap Dealer, or Major Swap Participant1/18/2011
11/23/2010Regulations Establishing and Governing the Duties of Swap Dealers and Major Swap Participants1/24/2011
11/23/2010Implementation of Conflicts of Interest Policies and Procedures by Swap Dealers and Major Swap Participants1/24/2011
11/23/2010Registration of Swap Dealers and Major Swap Participants1/24/2011
12/3/2010Protection of Collateral of Counterparties to Uncleared Swaps; Treatment of Securities in a Portfolio Margining Account in a Commodity Broker Bankruptcy2/1/2011
12/7/2010Real-Time Public Reporting of Swap Transaction Data2/7/2011
12/8/2010Swap Data Recordkeeping and Reporting Requirements2/7/2011
12/9/2010Reporting, Recordkeeping, and Daily Trading Records Requirements for Swap Dealers and Major Swap Participants2/7/2011
12/13/2010General Regulations and Derivatives Clearing Organizations2/11/2011
12/15/2010Information Management Requirements for Derivatives Clearing Organizations2/14/2011
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12/21/201017 CFR Part 1 Securities and Exchange Commission 17 CFR Part 240 Further Definition of “Swap Dealer,” “Security-Based Swap Dealer,” “Major Swap Participant,” “Major Security-Based Swap Participant” and “Eligible Contract Participant”2/22/2011
12/22/2010Business Conduct Standards for Swap Dealers and Major Swap Participants With Counterparties2/22/2011
12/22/2010Core Principles and Other Requirements for Designated Contract Markets4/18/2011
12/23/2010Swap Data Repositories2/22/2011
12/23/2010End-User Exception to Mandatory Clearing of Swaps2/22/2011
12/28/2010Confirmation, Portfolio Reconciliation, and Portfolio Compression Requirements for Swap Dealers and Major Swap Participants2/28/2011
1/6/2011Governance Requirements for Derivatives Clearing Organizations, Designated Contract Markets, and Swap Execution Facilities; Additional Requirements Regarding the Mitigation of Conflicts of Interest3/7/2011
1/7/2011Core Principles and Other Requirements for Swap Execution Facilities3/8/2011
1/20/2011Risk Management Requirements for Derivatives Clearing Organizations4/25/2011
2/3/2011Commodity Options and Agricultural Swaps4/4/2011
2/8/2011Swap Trading Relationship Documentation Requirements for Swap Dealers and Major Swap Participants4/11/2011
2/8/2011Orderly Liquidation Termination Provision in Swap Trading Relationship Documentation for Swap Dealers and Major Swap Participants4/11/2011
3/3/2011Amendments to Commodity Pool Operator and Commodity Trading Advisor Regulations Resulting From the Dodd-Frank Act5/2/2011
3/9/2011Registration of Intermediaries5/9/2011
3/10/2011Requirements for Processing, Clearing, and Transfer of Customer Positions4/11/2011

Notwithstanding the foregoing, commenters may submit, and the Commission will consider, comments on any aspects of the rulemakings, including comments on individual rulemakings subject of this extension, on the intersection of any combination of these rulemakings, or on the proposed rulemakings from a global perspective. All comments that were received after the close of the originally established comment period of each of the reopened rulemakings will be treated as if they were received during the reopened comment periods and need not be resubmitted.

Finally, the Commission is requesting comment on the order in which it should consider the Dodd-Frank final rulemakings.

Start Signature

Issued in Washington, DC, this 27th day of April 2010, by the Commission.

David A. Stawick,

Secretary of the Commission.

End Signature

Appendices to Reopening and Extension of Comment Periods for Rulemakings Implementing the Dodd-Frank Wall Street Reform and Consumer Protection Act—Commission Voting Summary and Statements of Commissioners

Note:

The following appendices will not appear in the Code of Federal Regulations.

Appendix 1—Commission Voting Summary

On this matter, Chairman Gensler and Commissioners Dunn, Chilton and O'Malia voted in the affirmative; Commissioner Sommers voted in the negative.

Appendix 2—Statement of Commissioner Scott D. O'Malia

I concur with the Commission's proposal to re-open the comment period for certain proposed rulemakings made under the Dodd-Frank Act and to request comment on the sequencing of the Commission's consideration of final rules. Following careful consideration of comments regarding the sequencing, the Commission should publish in the Federal Register the order in which it intends to take up consideration of the Dodd-Frank final rules. Doing so will help ensure that our processes are fully transparent and well informed.

Similarly, I strongly urge the Commission to propose a full implementation schedule, request comment and publish an adopted schedule in the Federal Register so that the market and public will have the certainty they need to make budgeting, investment and hiring decisions. Commenters should urge the Commission to publish a full implementation schedule by submitting comments to this rulemaking.

In order to facilitate debate, I have proposed the following sequencing of the Commission's consideration of final rules. I strongly recommend that the public comment on this proposal or recommend an alternative.

Phase I

  • Federal Energy Regulatory Commission (FERC) Memorandums of Understanding
  • Whistleblower
  • Fair Credit Reporting Act (FCRA) Rules
  • Reliance on Credit Ratings

Swap Data Repository

  • Data Recordkeeping
  • Large Trader reporting
  • Investment advisor reporting
  • Pre-enactment & Transition swaps
  • Governance of SDRs
  • Process to define a clearable swap

Phase II

Swap Dealer (SD)/Major Swap Participant (MSP)

  • End-User Exemption
  • SD/MSP Registration
  • Small Bank Exemption Rule
  • Business Conduct Standards for SD/MSP

Internal business conduct

Documentation Conflicts of Interest Capital and Margin

External Business conduct

  • Inter-Affiliate Transactions

Products Rules

  • Agricultural Swaps
  • Swaps
  • Agricultural commodity definition

Phase III

  • Position Limits
  • Clearing

Designated Clearing Organization (DCO) Core Principles

Systemically Important Designated Clearing Organizations (SIDCOs)

Governance of DCO

  • Execution

Real-time Reporting

Swaps Execution Facility (SEF) & Block Trade Rule

Designated Contract Market (DCM)

Foreign Board of Trade (FBOT)

Part 40 Rule Certification

Governance of SEFs & DCMs

Phase IV

  • Clearing

Rule 1.25

Segregation and Bankruptcy

Portfolio Margining

  • Anti-Manipulation
  • Disruptive Trading
  • Volker Rule 619
  • Commodity Pool Operator (CPO)/

Commodity Trading Adviser (CTA) Registration & conduct rulesStart Printed Page 25277

  • All Conforming Rules
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Footnotes

1.  See Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203, 124 Stat. 1376 (2010). The text of the Dodd-Frank Act may be accessed at http://www.cftc.gov./​LawRegulation/​OTCDERIVATIVES/​index.htm.

Back to Citation

2.  Pursuant to section 701 of the Dodd-Frank Act, title VII may be cited as the “Wall Street Transparency and Accountability Act of 2010.”

Back to Citation

[FR Doc. 2011-10884 Filed 5-3-11; 8:45 am]

BILLING CODE 6351-01-P