Swap Disclosure Rules Clarification Planned

     WASHINGTON (CN) – Foreign commodities regulators would not have to sign indemnification and confidentiality agreements to obtain data from swap data (SDR) repositories operating jointly under U.S. and foreign jurisdictions, under a proposed interpretive statement by the Commodity Futures Trading Commission.



     Section 21 of Commodity Exchange Act created a new class of registered entity-SDRs-to perform specified functions related to the collection and maintenance of swap transaction data and information.
     Under Section 21 before an SDR can disclose data to a regulator or investigative authority other than the CFTC, the SDR must secure indemnification against litigation from the parties whose data it releases and a confidentiality agreement from the party requesting the data.
     Some SDRs and foreign regulators expressed concerns that the indemnification and confidentiality requirements were counter to efforts to harmonize international regulation of swaps markets and put the SRS in an untenable position of having to deny access to one regulator on the dictate of another.
     In a proposed interpretative statement the CFTC said that “the confidentiality and indemnification provisions of section 21(d) should not operate to inhibit or prevent foreign regulatory authorities from accessing data in which they have an independent and sufficient regulatory interest-even if that data also has been reported pursuant to the CEA and Commission regulations.”
     The public has until June 6 to comment on the CFTC’s proposed interpretive statement.

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