Release Number 8565-22
CFTC Approves a Proposed Rule and a Proposed Order and Request for Comment
July 27, 2022
Washington, D.C. — Today, the Commodity Futures Trading Commission voted in favor of advancing two proposals. The first is a proposed rule on governance requirements for derivatives clearing organizations (DCOs). The second is a proposed order and a request for comment on an application for capital comparability determination submitted by the Financial Services Agency of Japan.
- Notice of Proposed Rulemaking on Governance Requirements for Derivatives Clearing Organizations: The Commission is proposing several amendments to Regulation 39.24 that enhance the Commission’s DCO governance standards and are consistent with recommendations from the Central Counterparty Risk and Governance Subcommittee of the Market Risk Advisory Committee. Specifically, the proposed regulations require a DCO to establish one or more risk management committees (RMCs) and one or more risk advisory working groups (RWGs). The proposed regulations also prescribe standards related to the composition, activities, and policies and procedures of RMCs and RWGs. In the notice of proposed rulemaking, the Commission invites comment on any aspect of the proposed rules, and also poses questions related to other topics for the Commission’s consideration and potential use in a future rulemaking. These questions involve topics such as consulting market participants prior to DCOs submitting rule changes pursuant to Part 40 of the Commission’s rules; the ability of RMC members to share information with others at their employer to obtain additional expert opinions; and governance related to the introduction of new products.
- Notice of Proposed Order and Request for Comment on an Application for a Capital Comparability Determination from the Financial Services Agency of Japan: In response to an application submitted by the Japan Financial Services Agency (JFSA), the Commission is requesting comment on a proposed comparability determination that would permit substituted compliance of Japan’s capital and financial reporting requirements for nonbank swap dealers as compared to the capital and financial reporting requirements adopted by the Commission pursuant to Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Commission is inviting public comment on its analysis and proposed comparability determination order, including its proposed conditions, as well as on the JFSA Application and relevant Japanese laws.
Both proposals will be available for comment for 60 days post publishing in the Federal Register. Comments may be submitted via the CFTC Comments Portal at: https://comments.cftc.gov.