April 4, 2016
CFTC Approves Proposed Guidance Relating to the Appropriate Treatment of Certain Electric Power and Natural Gas Contracts
Washington, DC — The U.S. Commodity Futures Trading Commission (CFTC) today approved proposed guidance relating to the appropriate treatment of certain electric power and natural gas contracts. The unanimous vote was conducted via seriatim.
More specifically, the CFTC has proposed guidance that certain capacity contracts in electric power markets and certain natural gas contracts, which commenters labeled as “peaking supply contracts,” should not be considered “swaps” under the Commodity Exchange Act because they are examples of customary commercial arrangements as described in the final rule defining the term “swap.”
In accordance with section 712(d)(4) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the proposed guidance was issued jointly with the U.S. Securities and Exchange Commission after consultation with the Board of Governors of the Federal Reserve System.
The CFTC invites public comment on all aspects of its proposed guidance, and the comment period will close 30 days after the proposed guidance is published in the Federal Register.
Last Updated: April 4, 2016