CFTC Issues Final Rule 13-49: Exempting Qualified Cooperatives from Clearing Requirements

The CFTC has issued a final rule exempting swaps entered into by qualified cooperatives from clearing requirements under Section 2(h)(1)(A) ("Standard for Clearing") of the CEA, and Part 50 ("Clearing Requirement") of CTFC regulations. The final rule permits a qualifying cooperative to elect not to clear a swap subject to the clearing requirement, provided that the cooperative's members are either non-financial entities or other cooperatives whose members are non-financial entities. The swap must be entered in connection with originating loans to cooperative members, or it must hedge or mitigate commercial risk related to loans or swaps with members.

See: CFTC Press Release; CFTC Letter No. 13-49.See also: Final Rule in Federal Register.