CFTC Announces Mandatory Clearing of iTraxx CDS Indices for Category 2 Entitites

The Division of Clearing and Risk of the CFTC announced that the second phase of required clearing for certain iTraxx credit default swap ("CDS") indices has begun for Category 2 Entities. Category 2 Entities include commodity pools, private funds, and persons predominately engaged in activities that are in the banking business or in activities that are financial in nature, except for third-party subaccounts. These entities are required to begin clearing iTraxx CDS indices that are subject to the clearing requirement under section 2(h) ("Clearing Requirements") of the CEA and Regulations 50.2 ("Treatment of Swaps Subject to a Clearing Requirement") and 50.4(b) ("Classes of Swaps Required to Be Cleared"). All other entities will be subject to the mandatory clearing requirement by October 23, 2013.

See: CFTC Press Release.