SEC and ECB Sign MOU on Cross-Border Supervision of SBSDs

The SEC and the European Central Bank ("ECB") entered into a Memorandum of Understanding ("MOU"), setting forth the terms for consultation, cooperation and the exchange of information between the regulators in the oversight of certain security-based swap dealers ("SBSDs").

The MOU is intended to aid in the SEC's oversight of SEC-registered SBSDs that are subject to the Single Supervisory Mechanism (which is the EU's cross-national-border regulatory group). The MOU includes guidelines for ongoing notifications, request-based information sharing, and periodic consultations. In addition, the MOU outlines the parameters for on-site visits, during which the SEC and the ECB seek to examine the internal documents of firms regulated by the other agency.

The MOU will also facilitate the SEC's supervision of any substituted compliance orders the SEC grants, including those already granted for SBSDs in France and Germany.