SEC Proposes Securities-Based Swap Recordkeeping, Reporting and Notification Requirements

On May 2, 2014, the Securities and Exchange Commission (SEC)published in the Federal Register proposed regulations1 that would implement the recordkeeping, reporting and notification requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) applicable to registered security-based swap dealers (SBSDs), major security-based swap participants (MSBSPs) and broker-dealers engaged in security based swap activities.

The SEC proposal focuses on four basic classifications of registered entities:

(1) Broker-dealers that are not registered as SBSDs or MSBSPs, but are engaged in security-based swap activities (stand-alone broker-dealers),

(2) SBSDs and MSBSPs that are dually registered as broker dealers (broker-dealer SBSDs and broker-dealer MSBSPs),

(3) SBSDs and MSBSPs that are not dually registered as broker dealers (stand-alone SBSDs and stand-alone MSBSPs), and

(4) SBSDs and MSBSPs that also are banks (bank SBSDs and bank MSBSPs). Collectively, we refer to these four categories of registered entities as broker-dealers, SBSDs and MSBSPs.

This client alert summarizes the key aspects of the SEC’s proposal. The SEC will accept comments on its proposal through July 1, 2014.

Please see full memorandum below for more information.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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