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.