Financial Regulators Seek Public Comment for Joint Study on Stable Value Contracts

Jack Humphrey, Regulatory journalist
August 19, 2011 /

The Securities and Exchange Commission and the Commodity Futures Trading Commission (CFTC) have approved for publication in the Federal Register a request seeking public comment in relation to the conduct of a joint study on stable value contracts.

Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act covers the comprehensive regulation of swaps and security-based swaps and includes definitions of key terms relating to such regulation.

Under Title VII, the SEC and CFTC are required to jointly conduct a study to determine whether stable value contracts fall within the definition of a swap, and if so, whether exempting such contracts from the swap definition is appropriate and in the public interest.

The Dodd-Frank Act requires the SEC and CFTC to make the determination in consultation with the Department of Labor, the Department of the Treasury, and the state entities that regulate the issuers of stable value contracts.

If the the two federal agencies determine that SVCs fall within the definition of a swap, they jointly shall determine if an exemption for SVCs from the definition of a swap is appropriate and in the public interest.

Public comments must be received on or before 30 days after publication in the Federal Register.

 

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