On November 16, 2012, the United States Department of the Treasury (the “Treasury Department”) issued a final determination (the “Final Determination”) regarding the treatment of foreign exchange swaps and certain foreign exchange forwards under the Commodity Exchange Act (the “CEA”). When adding “swaps” to the list of commodity interests regulated under the CEA, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) defined “swaps” broadly to encompass most over-the-counter derivatives contracts, including foreign exchange swaps and foreign exchange forwards. However, the Dodd-Frank Act also authorized the Treasury Department to determine that foreign exchange swaps, certain foreign exchange forwards, or both, should not be regulated as swaps under the CEA. In the Final Determination, the Treasury Department exercised the authority granted by the Dodd-Frank Act to exempt both foreign exchange swaps and certain foreign exchange forwards from the definition of “swap.” The Final Determination will be effective upon publication in the Federal Register, which is expected within the next few weeks.

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