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SIFMA, the International Securities Lending Association ("ISLA") and the International Capital Market Association ("ICMA") (collectively, the "associations") responded to a Prudential Regulation Authority consultation paper that proposed new rules requiring the recognition of UK resolution stays in certain financial contracts. The consultation paper, titled " Contractual Stays in Financial Contracts Governed by Third-Country Law " concerns contracts governing derivatives, repurchase and reverse repurchase transactions and securities lending transactions governed by the laws of jurisdictions

Commentary by Nihal Patel

FINRA filed a proposed rule change to amend FINRA Rule 4210 to establish margin requirements for "To-Be-Announced" transactions ("TBAs") and other forward-settling transactions in agency securities. The proposal follows on recommendations for margining in these transactions made by the New York Federal Reserve Bank's Treasury Market Practice Group ("TMPG"). The new requirements would apply to: (i) TBA transactions, inclusive of adjustable rate mortgage transactions; (ii) Specified Pool Transactions; and (iii) certain transactions in Collateralized Mortgage Obligations (collectively "Covered

FINRA's revised proposal to amend FINRA Rule 4210 ("Margin Requirements") was published in the Federal Register. The amendments would establish margin requirements for (i) to-be-announced transactions ("TBAs"), (ii) Specified Pool Transactions and (iii) transactions in Collateralized Mortgage Obligations. Comments on the proposal must be submitted by November 10, 2015.

SIFMA expressed concern about the clarity, operational feasibility and potential negative impact of FINRA’s proposal to establish margin requirements for transactions in the “to-be-announced” ("TBA") market. SIFMA filed a comment letter in response to FINRA's proposal to amend FINRA Rule 4210 ("Margin Requirements"). In the letter, SIFMA expressed significant concerns about the "impact of the proposal on the mortgage market (particularly as to whether the burdens of certain aspects of the proposal will cause either member firms or their counterparties to withdraw from parts of the market)."

ISDA published the 2015 ISDA Universal Resolution Stay Protocol (the "2015 ISDA Protocol") which "enables parties to amend the terms of their Protocol Covered Agreements to contractually recognize the cross-border application of special resolution regimes applicable to certain financial companies and support the resolution of certain financial companies under the United States Bankruptcy Code." In addition, SIFMA, the International Capital Market Association ("ICMA") and the International Securities Lending Association ("ISLA"), in coordination with ISDA and the Financial Stability Board