A swap that is required by CEA Section 2(h) to be cleared is also required to be traded on a CFTC-regulated market if (i) a SEF or DCM has "made the swap available to trade" ("MAT") and (ii) no exception is available. (A swap that must be traded on a SEF or DCM is referred to as a "Required Transaction.") The CFTC has granted exemptions for swaps from Required Transaction status for (i) certain affiliate trades, (ii) package transactions, (iii) transactions in connection with errors, (iv) transactions that are part of a price determination process organized by a clearing corporation, and (v) transactions executed on certain non-U.S. exchanges. Further, "block transactions" may be executed "off-facility" but pursuant to the rules of a SEF or DCM (which provides such swaps with the benefits of delayed reporting and capped reporting transactions size).
The MAT Rules have been controversial and the CFTC now has proposed to replace them with new CFTC Rules Part 36. See the memorandum Swap Execution Facilities, the Sequel. See also the topic pages on the regulation of Swap Execution Facilities and the Swap Clearing Requirement.