[Federal Register Volume 77, Number 134 (Thursday, July 12, 2012)]
[Proposed Rules]
[Pages 41109-41110]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-16983]


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COMMODITY FUTURES TRADING COMMISSION

17 CFR Part 23


Margin Requirements for Uncleared Swaps for Swap Dealers and 
Major Swap Participants

AGENCY: Commodity Futures Trading Commission.

ACTION: Extension of comment period.

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SUMMARY: On April 28, 2011, the Commodity Futures Trading Commission 
(``Commission'' or ``CFTC'') published in the Federal Register a notice 
of proposed rulemaking that would establish initial and variation 
margin requirements on uncleared swaps for swap dealers (``SDs'') and 
major swap participants (``MSPs'').\1\ In October 2011, the Basel 
Commission on Banking Supervision (``BCBS'') and the International 
Organization of Securities Commissions (``IOSCO'') established a 
Working Group on Margin Requirements (``WGMR'') to develop harmonized 
international standards for uncleared swaps. BCBS and IOSCO recently 
published a consultative paper prepared by the WGMR that outlines 
possible margin requirements for non-centrally cleared derivatives 
(``consultative paper'').\2\ The Commission is extending the comment 
period for its proposed margin rules for uncleared swaps for swap 
dealers and major swap participants in order to give interested parties 
the opportunity to comment on the consultative paper and the CFTC's 
proposed rules concurrently.
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    \1\ See 76 FR 23732.
    \2\ The WGMR is comprised of representatives from over 25 
domestic and international regulatory authorities, including the 
CFTC.

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DATES: Comments must be submitted on or before September 14, 2012.

ADDRESSES: You may submit comments, identified by RIN 3038-AC97, and 
Margin Requirements for Uncleared Swaps for Swap Dealers and Major Swap 
Participants by any of the following methods:
     The Agency's Web site, at http://comments.cftc.gov/. 
Follow the instructions for submitting comments through the web site.
     Mail: David A. Stawick, Secretary of the Commission, 
Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st 
Street NW., Washington, DC 20581.
     Hand Delivery/Courier: Same as mail above.
     Federal eRulemaking Portal: http://www.regulations.gov.
    Please submit your comments using only one method.

[[Page 41110]]

    All comments must be submitted in English, or if not, accompanied 
by an English translation. Comments will be posted as received to 
www.cftc.gov. If you wish the Commission to consider information that 
you believe is 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 Sec.  145.9 
of the Commission's regulations.\3\ 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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    \3\ See 17 CFR 145.9.

FOR FURTHER INFORMATION CONTACT: John C. Lawton, Deputy Director, 
jlawton@cftc.gov, Division of Clearing and Risk, or Jason A. Shafer, 
Attorney Advisor, Division of Swap Dealer and Intermediary Oversight, 
jshafer@cftc.gov, Commodity Futures Trading Commission, Three Lafayette 
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Centre, 1155 21st Street NW., Washington, DC 20581.

SUPPLEMENTARY INFORMATION: On April 28, 2011, the Commission published 
in the Federal Register a notice of proposed rulemaking that would 
establish initial and variation margin requirements on uncleared swaps 
for SDs and MSPs.\4\ In October 2011, BCBS and IOSCO established the 
WGMR to develop harmonized international standards for uncleared swaps. 
BCBS and IOSCO recently published a consultative paper prepared by the 
WGMR that outlines possible margin requirements for non-centrally 
cleared derivatives.\5\ The consultative paper addresses a number of 
topics, including: (i) The instruments that would be subject to margin 
requirements; (ii) the market participants to be subject to margin 
requirements; (iii) initial margin and variation margin methodology; 
(iv) eligible collateral; (v) treatment of provided margin; (vi) 
treatment of inter-affiliate transactions; and vii) treatment of cross-
border transactions.\6\
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    \4\ See 76 FR 23732.
    \5\ The WGMR is comprised of representatives from over 25 
domestic and international regulatory authorities, including the 
CFTC.
    \6\ The consultative paper is available on the Bank for 
International Settlements (``BIS'') Web site (www.bis.org), the 
IOSCO Web site (www.iosco.org) and the CFTC Web site (www.cftc.gov).
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    BCBS and IOSCO are requesting comment on the initial proposals set 
forth in the consultative paper. After reviewing and evaluating any 
comments received, the WGMR will issue final policy recommendations for 
margin requirements for non-centrally cleared derivatives.\7\ As part 
of the international effort to implement consistent global standards 
for margin requirements for non-centrally cleared derivatives, the CFTC 
will consider the final policy recommendations set forth by the WGMR 
when adopting its final rules for margin for uncleared swaps and may 
adapt its final rules to conform with the final policy recommendations 
set forth by BCBS and IOSCO. Accordingly, the Commission believes it is 
appropriate to extend the comment period for its proposed margin 
requirements in order to give interested parties the opportunity to 
comment on the consultative paper and the CFTC's proposed rule 
concurrently.
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    \7\ Concurrently with the comment period for the consultative 
paper, BCBS and IOSCO also will conduct a quantitative impact study 
(``QIS'') to assess the costs and benefits of margin requirements. 
The results of the QIS will be considered along with the comments 
submitted on the consultative paper in formulating a final joint 
proposal on non-centrally cleared derivatives.
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    Therefore, the Commission is extending the comment period until 
September 14, 2012, for all aspects of its proposed margin rules on 
uncleared swaps and specifically requests quantitative data and 
analysis on the comparative costs and benefits of the CFTC's proposed 
rule and the initial proposals set forth in the consultative paper.

    Issued by the Commission, this 5th day of July 2012.
David Stawick,
Secretary of the Commission, Commodity Futures Trading Commission.

    Note: The following appendix will not appear in the Code of 
Federal Regulations

Appendix 1--Statement of Chairman Gary Gensler

    I support the formal reopening of the comment period on the 
CFTC's initial margin proposal so that we can hear further from 
market participants in light of work being done to internationally 
harmonize an approach to margin.
    The CFTC has been working with the Federal Reserve, the other 
U.S. banking regulators, the Securities and Exchange Commission and 
international regulators and policymakers to align margin 
requirements for uncleared swaps. I think it is essential that we 
align these requirements globally, particularly between the major 
market jurisdictions. The international approach to margin 
requirements in the consultative paper (sponsored by the Basel 
Committee on Banking Supervision and the International Organization 
of Securities Commissions) released today is consistent with the 
approach the CFTC laid out in its margin proposal last year. It 
would lower the risk of financial entities, promote clearing and 
help avoid regulatory arbitrage.

[FR Doc. 2012-16983 Filed 7-11-12; 8:45 am]
BILLING CODE 6351-01-P