On December 15, 2010 Darrell Duffie, Professor Stanford University, spoke by phone with CFTC staff.  The purpose of the call was to offer informal advisory assistance regarding the implementation of data rulemakings.  Professor Duffie communicated to staff his view that the most effective way to organize data reporting was at the level of the master swap agreement between two counterparties.  He advised that the basic entity of a hierarchical data structure for systemic risk analysis ought to be the master swaps agreement and that it was important to get the data structure co

On January 13, 2011, CFTC staff participated via teleconference in a meeting with Markit and the SEC.  Markit shared some preliminary views on the data related rulemakings for both agencies, including Real-time Public Reporting, Swap Data Repositories (SDRs) and Data and Recordkeeping.  ~ ~I. ~Real-time Public Reporting~Markit discussed the anticipated impact of the Real-time Public Reporting rules on the industry and the differences between the CFTC’s and the SEC’s approaches to real-time public reporting.  Specifically, Markit raised the concerns and comments belo

CFTC staff met with representatives from Eurex to discuss the proposed Foreign Board of Trade (FBOT) registration rules.  Eurex discussed the FBOT registration application process, including timing concerns as well as the scope of the limited application described in the proposed rule.  Eurex also presented issues related to an FBOT’s clearing agency that has a pending application with the Commission to become a derivatives clearing organization (DCO), and asked whether a pending (or complete) DCO application would exempt an FBOT from the proposed requirement that its clearing org

On December 22, 2010, Commission staff participated in a teleconference with ICAP to discuss the notice of proposed rulemaking regarding swap execution facilities.  ~ ~Access~ICAP asked what entities are included in the proposed regulations regarding access.  Commission staff noted that eligible contract participants and independent software vendors are included in the proposed regulations.  Regarding independent software vendors, ICAP asked whether the proposed regulations would require it to grant access to any independent software vendor requesting such access. 

On January 19, 2011, CFTC Staff met with representatives from Evolution Markets.  During the meeting, Evolution Markets asked Staff several questions and had several comments related to the SEF NPRM as follows: (i) Swaps made available for trading – Evolution Markets suggested other metrics for SEFs to consider when assessing whether a swap is available for trading, such as size of transactions, volume, and number of participants.  Staff noted these points and requested that Evolution Markets submit a comment letter; (ii) 15 second delay provision in Section 37.9(b)(3) – Evol

TruMarx asked Staff several questions and had several comments related to the SEF and other NPRMs as follows: (i) Conflicts of Interest – TruMarx stated that the 20% limit on voting could be a barrier to entry for some startup SEFs because of the inability to attract enough investors.  TruMarx suggested that an exemption to this requirement be added to the rules based on the size of the SEF.  Staff responded that the conflicts of interest rulemaking team is aware of the issue and is researching it; (ii) Five participant requirement for request for quotes (RFQs) – TruMarx

Topics of discussion: clearing requirement; FX transactions; Dodd-Frank general

The state regulators primarily read their questions from their agenda (see attached). In addition, the following topics were discussed: (1) Municipal-Specific Issues. The SEC asked, in response to several questions, whether there were muni-specific issues and, if so, if the regulators could provide written comments describing those. In particular, the SEC asked if pension plans and their sponsors faced different issues than states, counties, cities, etc; (2) Bespoke Derivatives.

The Chairman opened the meeting by giving a description of the rulewriting process and how the Commission has organized itself around 30 teams. He then informed the attendees of the status of the process and what rules were yet to be considered. Following the update, the Chairman asked for questions.~ ~The first question concerned the possibility for a phase-in approach to the imposition of new rules coming out of Dodd-Frank. The potential phase-in would apply in particular to clearing, reporting, and trading rules.