The SEC final rule to establish security-based swap capital, margin and segregation requirements was published in the Federal Register. The effective date is October 21, 2019. The compliance date for both the new rules and rule amendments will be 18 months after the later of either (i) the effective date of the final rules establishing recordkeeping and reporting requirements for SBSDs, or (ii) the effective date of the final rules concerning the cross-border application of certain security-based swap requirements.
As previously covered, the adopted rules will, among other things:
establish minimum capital requirements, where there is not a prudential regulator, for security-based swap dealers ("nonbank SBSDs");
increase the minimum net capital requirements for broker-dealers that use internal models to compute net capital;
adopt capital requirements for security-based swap dealers and swap-related amendments to the rules for broker-dealers that are not registered as SBSDs;
adopt security-based swap margin requirements for nonbank SBSDs;
adopt segregation requirements for SBSDs and stand-alone broker-dealers for cleared and non-cleared security-based swaps; and
allow foreign SBSDs to request substituted compliance regarding capital and margin requirements.
The SEC adopted new rules and rule amendments to establish security-based swap capital, margin and segregation requirements.
Cadwalader attorneys reviewed the SEC's security-based swap rules under Dodd-Frank Title VII in light of the agency taking action to reopen the comment period on capital, margin and segregation requirements.
The reopening of the comment period and request for additional comment on capital, margin and segregation requirements for security-based swap dealers was published in the Federal Register.
The SEC reopened the comment period on proposed new rules and amendments relating to capital, margin and segregation requirements for security-based swaps.
SEC Commissioner Hester Peirce laid out the Commission's agenda for implementing security-based swap rules under Title VII of Dodd-Frank.
On June 21, 2019, the SEC adopted new rules and rule amendments that establish security-based swap capital, margin and segregation requirements.
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