SEC at odds with CFTC on swap trade rules
The SEC proposed rules for trading swaps on "swap execution facilities", or SEFs, that differ from those being considered by the CFTC. Under its proposal, a potential buyer or seller of a swap could seek a price from all participants, or choose to send it to fewer.
In effect, the SEC rule means that SEFs for single name CDS could adhere to the current market practice of an RFQ being sent to a single dealer. Under proposed CFTC rules for SEFs covering interest rate swaps and credit indices, a RFQ must be sent to at least five dealers.
Publication
Financial Times
Date
February 3, 2011
Cross References
Dodd-Frank Act, Title VII, Secs. 723 733; 17 CFR Part 37; 76 Fed. Reg. 1214