SECURITIES AND EXCHANGE COMMISSION

SECURITIES AND EXCHANGE COMMISSION

17 CFR Parts 240, 242, and 249

Release No. 34-69491; File Nos. S7-27-10, S7-32-10, S7-34-10, S7-35-10, S7-43-10, S7-03-11,

S7-06-11, S7-08-11, S7-25-11, S7-40-11, S7-05-12, S7-08-12

RIN 3235–AK74, 3235–AK77, 3235–AK80, 3235–AK79, 3235–AK88, 3235–AK91, 3235–

AK93, 3235–AL13, 3235–AL10, 3235–AL05, 3235-AL12

REOPENING OF COMMENT PERIODS FOR CERTAIN RULEMAKING RELEASES

AND POLICY STATEMENT APPLICABLE TO SECURITY-BASED SWAPS

PROPOSED PURSUANT TO THE SECURITIES EXCHANGE ACT OF 1934 AND THE

DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT

AGENCY:

Securities and Exchange Commission.

ACTION:

Reopening of comment periods.

SUMMARY: The Securities and Exchange Commission (“Commission”) is reopening the

comment periods for its outstanding rulemaking releases, published in the Federal Register and

listed herein, that concern security-based swaps (“SB swaps”) and SB swap market participants

and were proposed pursuant to certain provisions of Title VII of the Dodd-Frank Wall Street

Reform and Consumer Protection Act (the “Dodd-Frank Act”) and the Securities Exchange Act

of 1934 (the “Exchange Act”), among other provisions (together, the “Proposed Rules”). The

Commission is also reopening the comment period for its Statement of General Policy on the

Sequencing of the Compliance Dates for Final Rules Applicable to Security-Based Swaps

adopted pursuant to the Exchange Act and the Dodd-Frank Act, published in the Federal Register

on June 14, 2012 (the “Policy Statement”). The reopening of these comment periods is intended

to allow interested persons additional time to analyze and comment upon the Proposed Rules and

the Policy Statement in light of the Commission’s proposal of substantially all of the rules

required to be adopted by Title VII of the Dodd-Frank Act, its proposal of rules and

interpretations addressing the application of the SB swap provisions of Title VII of the Dodd-

Frank Act to cross-border SB swap transactions and non-U.S. persons that act in capacities

regulated under the Dodd-Frank Act (the “Cross-Border Proposed Rules”), and the Commodity

Futures Trading Commission’s (the “CFTC”) adoption of substantially all of the rulemakings

establishing the new regulatory framework for swaps. All comments received to date on the

Proposed Rules and the Policy Statement will be considered and need not be resubmitted.

DATES:

For the Proposed Rules and the Policy Statement, the comment periods are re-

opened until July 22, 2013.

ADDRESSES:

Comments may be submitted by any of the following methods:

Electronic Comments:

•

Use the Commission’s Internet comment form (http://www.sec.gov/rules/proposed.shtml);

•

Send an email to rule-comments@sec.gov. Please include the file number for the specific

action being commented upon on the subject line; or

•

Use the Federal Rulemaking portal (http://www.regulations.gov). Follow the instructions for

submitting comments.

Paper Comments:

•

Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and

Exchange Commission, 100 F Street, NE, Washington, DC 20549-1090.

All submissions should refer to the file number for the specific action being commented upon.

This file number should be included on the subject line if e-mail is used. To help us process and

review your comments more efficiently, please use only one method. We will post all comments

on the Commission’s Internet website (http://www.sec.gov). Comments also are available for

website viewing and printing at the Commission’s Public Reference Room, 100 F Street, NE,

Washington, DC 20549, on official business days between the hours of 10:00 am and 3:00 pm.

2

All comments received will be posted without change; we do not edit personal identifying

information from submissions. You should submit only information that you wish to make

available publicly.

FOR FURTHER INFORMATION CONTACT: With respect to this release, Ann Parker

McKeehan, Special Counsel, at (202) 551-5797, or Jason Williams, Attorney-Adviser, at (202)

551-5763, Office of Derivatives Policy, Division of Trading and Markets, Securities and

Exchange Commission, 100 F Street, NE, Washington, DC 20549. With respect to a particular

action discussed herein, the Commission staff member listed in the action.

SUPPLEMENTARY INFORMATION:

I.

Background

Subtitle B of Title VII of the Dodd Frank Act 1 (“Title VII”) amends the Securities Act of

1933 (“Securities Act”) 2 and the Exchange Act 3 to substantially expand the regulation of the SB

swap market with a goal of establishing a new regulatory framework within which this market

can evolve in a more transparent, efficient, fair, accessible, and competitive manner. 4 Under the

Dodd-Frank Act, regulatory authority over derivatives is divided between the Commission and

the CFTC, with the Commission having authority over SB swaps, the CFTC having authority

over swaps, which represent the overwhelming majority of the overall market for derivatives

subject to the Dodd-Frank Act, and the Commission and the CFTC jointly regulating mixed

swaps. 5

1

Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203, 124 Stat. 1376 (2010).

2

15 U.S.C. 77a et seq.

3

15 U.S.C. 78a et seq.

4

See generally Subtitle B of Title VII.

Section 712(d) of the Dodd-Frank Act provides that the Commission and the CFTC, in consultation with the

Board of Governors of the Federal Reserve System, shall further define the terms “swap” and “security-based

5

3

The Title VII amendments to the Exchange Act generally require, among other things: (1)

the registration and comprehensive oversight of security-based swap dealers and major securitybased swap participants; 6 (2) the reporting of SB swaps to a registered security-based swap data

repository (“SDR”), or to the Commission (if the SB swap is uncleared and no SDR will accept

the SB swap), and dissemination of SB swap information to the public; 7 (3) the clearing of SB

swaps at a registered clearing agency (or a clearing agency that is exempt from registration) if

the Commission makes a determination that such SB swaps are required to be cleared, unless an

exception from the mandatory clearing requirement applies; 8 and (4) if an SB swap is subject to

the clearing requirement, the execution of the SB swap transaction on an exchange, on a

security-based swap execution facility (“SB SEF”) registered under the Exchange Act, 9 or on an

swap,” among others. These terms are defined in sections 721 and 761 of the Dodd-Frank Act and the Commission

and the CFTC have adopted further definitions of these terms in a joint rulemaking. See Further Definition of

“Swap,” “Security-Based Swap,” and “Security-Based Swap Agreement”; Security-Based Swap Agreement

Recordkeeping, Release No. 33-9338 (July 18, 2012); 77 FR 48208 (Aug. 13, 2012) (“Product Definitions Rules”).

6

See section 15F of the Exchange Act, 15 U.S.C. 78o-10.

7

See section 3(a)(75) of the Exchange Act, 15 U.S.C. 78c(a)(75) (defining the term “security-based swap data

repository”); section 13(m) of the Exchange Act (regarding public availability of SB swap data); section 13(n) of the

Exchange Act (regarding requirements related to SDRs); and section 13A of the Exchange Act (regarding reporting

and recordkeeping requirements for certain SB swaps). See also Security-Based Swap Data Repository

Registration, Duties, and Core Principles, Release No. 34-63347 (Nov. 19, 2010), 75 FR 77306 (Dec. 10, 2010);

corrected at 75 FR 79320 (Dec. 20, 2010) and 76 FR 2287 (Jan. 13, 2011); and Regulation SBSR – Reporting and

Dissemination of Security-Based Swap Information, Release No. 34-63346 (Nov. 19, 2010), 75 FR 75208 (Dec. 2,

2010).

8

See section 3C(a)(1) of the Exchange Act, 15 U.S.C. 78c-3(a)(1). See also Process for Submissions for Review of

Security-Based Swaps for Mandatory Clearing and Notice Filing Requirements for Clearing Agencies; Technical

Amendments to Rule 19b-4 and Form 19b-4 Applicable to All Self-Regulatory Organizations, Release No. 3463557 (Dec. 15, 2010), 75 FR 82490 (Dec. 30, 2010).

9

15 U.S.C. 78c-4.

4

SB SEF that has been exempted from registration by the Commission under the Exchange Act, 10

unless no SB SEF or exchange makes such SB swap available for trading. 11

The Commission has proposed substantially all of the rules required to be adopted by

Title VII. 12 The Commission also has adopted the following rules:

•

Joint rules with the CFTC that further define the terms “swap dealer,” “security-based swap

dealer,” “major swap participant,” “major security-based swap participant,” and “eligible

contract participant;” 13

•

Rules that establish the procedure by which clearing agencies submit SB swaps for a

determination as to whether those instruments should be subject to mandatory clearing; 14

•

Joint rules with the CFTC that further define the terms “swap,” “security-based swap,” and

“security-based swap agreement” and regarding the regulation of mixed swaps and SB swap

agreement recordkeeping; 15 and

•

Rules that establish standards for how registered clearing agencies should manage their risks

and run their operations. 16

10

Id. at 78c-4(e).

11

See section 3C(g) of the Exchange Act, 15 U.S.C. 78c-3(g) and section 3C(h) of the Exchange Act, 15 U.S.C.

78c-3(h). See also section 3(a)(77) of the Exchange Act, 15 U.S.C. 78c(77) (defining the term “security-based swap

execution facility”). See also Registration and Regulation of Security-Based Swap Execution Facilities, Release No.

34-63825 (Feb. 2, 2011), 76 FR 10948 (Feb. 28, 2011).

12

The Commission has not yet proposed rules regarding the reporting and recordkeeping requirements to which

security-based swap dealers and major security-based swap participants will be subject pursuant to Exchange Act

section 15F(f). 15 U.S.C. 78o-10(f).

13

See Further Definition of “Swap Dealer,” “Security-Based Swap Dealer,” “Major Swap Participant,” “Major

Security-Based Swap Participant” and “Eligible Contract Participant”, Release No. 34-66868 (Apr. 27, 2012), 77 FR

30596 (May 23, 2012) (“Entity Definitions Rules”).

14

See Process for Submissions for Review of Security-Based Swaps for Mandatory Clearing and Notice Filing

Requirements for Clearing Agencies; Technical Amendments to Rule 19b-4 and Form 19b-4 Applicable to All SelfRegulatory Organizations, Release No. 34-67286 (June 28, 2012), 77 FR 41602 (July 13, 2012) (“Clearing

Procedures Rules”).

15

See Product Definitions Rules, supra note 5.

5

Most recently, the Commission has proposed the Cross-Border Proposed Rules, which

address the treatment of cross-border SB swap transactions and non-U.S. persons acting in

capacities regulated under Title VII. 17 While the Commission may propose additional rules

pertaining to SB swaps that are not mandated by Title VII, SB swap market participants and

other members of the public now have a substantially complete picture of the Commission’s

proposed regulatory framework for SB swaps. Additionally, the CFTC has adopted nearly all of

the rules establishing the swaps regulatory regime. 18

II.

Reopening of Comment Periods

In light of the substantially complete picture of the proposed SB swap regulatory regime and

the CFTC’s adoption of many of the rulemakings creating the swaps regulatory regime, the

Commission is reopening the comment period of the Proposed Rules and the Policy Statement

until [insert date 60 days from publication in the Federal Register] to provide the public with

an additional opportunity to analyze and comment upon the proposed SB swap regulatory

framework, either in part or as a whole. Commenters may submit, and the Commission will

consider, comments on any aspect of the Proposed Rules and the Policy Statement. In addition

to the questions raised in the Proposed Rules and the Policy Statement, the Commission

specifically seeks comments on the following:

16

See Clearing Agency Standards, Release No. 34-68080 (Oct. 22, 2012), 77 FR 66219 (Nov. 2, 2012) (“Clearing

Agency Standards”).

17

See Cross-Border Application of Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act;

Re-Proposal of Regulation SBSR and Certain Rules and Forms Relating to the Registration of Security-Based Swap

Dealers and Major Security-Based Swap Participants, Release No. 34-_______ (____, 2013).

18

CFTC Chairman Gary Gensler has noted that the CFTC has “largely completed the swaps market rulemaking,

with 80 percent behind us….” Gary Gensler, Chairman, Commodity Futures Trading Comm’n, Opening Remarks at

CFTC Public Roundtable on “Futurization of Swaps” (Jan. 31, 2013) (transcript available at

http://www.cftc.gov/PressRoom/SpeechesTestimony/opagensler-130).

6

•

The economic consequences and effects, including costs and benefits, of the Proposed Rules,

either individually or as a whole, including any related quantitative or qualitative

information. Please specify whether such information includes the costs and benefits of

systems, policies, or procedures already implemented to comply with the CFTC’s adoption of

final rules and interpretive orders pertaining to Title VII (together, the “CFTC Rules”);

•

The overall framework and approach to implementation detailed in the Proposed Rules and

the Policy Statement;

•

The relationship of the Proposed Rules to any parallel requirements of other authorities,

including the CFTC and relevant foreign regulatory authorities;

•

With respect to the CFTC Rules, whether and to what extent the Commission in adopting its

own rules should emphasize consistency with the CFTC Rules versus adopting rules that are

more tailored to the SB swap market, with inclusion of any specific examples where

consistency or tailoring of a particular rule or rule set is more critically important; and

•

Whether there are any areas where additional rules or interpretations should be proposed or

formal guidance provided and if so, why.

The comment periods for the following actions are being reopened until [insert date 60 days

from publication in the Federal Register]: 19

19

The comment periods for the Entity Definitions Rules, the Clearing Procedures Rules, the Product Definitions

Rules, and the Clearing Agency Standards are not being reopened given that, as noted in Section I above, these rules

have been adopted by the Commission.

7

Date Published

in the Federal

Register

Title and Release Number of Rulemaking

Date Closed

10/26/2010

Ownership Limitations and Governance Requirements for Security-Based

Swap Clearing Agencies, Security-Based Swap Execution Facilities, and

National Securities Exchanges with Respect to Security-Based Swaps under

Regulation MC (Release No. 34-63107, File No. S7-27-10) and Reopening

of Comment Period (Release No. 34-64018)

4/29/2011

11/8/2010

Prohibition Against Fraud, Manipulation, and Deception in Connection with

Security-Based Swaps (Release No. 34-63236, File No. S7-32-10)

12/23/2010

12/2/2010

Regulation SBSR – Reporting and Dissemination of Security-Based Swap

Information (Release No. 34-63346, File No. S7-34-10)

1/18/2011

12/10/2010

Security-Based Swap Data Repository Registration, Duties, and Core

Principles (Release No. 34-63347, File No. S7-35-10)

1/24/2011

12/21/2010

End-User Exception to Mandatory Clearing of Security-Based Swaps

(Release No. 34-63556, File No. S7-43-10)

2/4/2011

1/21/2011

Trade Acknowledgement and Verification of Security-Based Swap

Transactions (Release No. 34-63727, File No. S7-03-11)

2/22/2011

2/28/2011

Registration and Regulation of Security-Based Swap Execution Facilities

(Release No. 34-63825, File No. S7-06-11)

4/4/2011

3/16/2011

Clearing Agency Standards for Operation and Governance (Release No. 3464017, File No. S7-08-11), other than those portions adopted by the

Clearing Agency Standards (Release No. 34-68080)

4/29/2011

7/18/2011

Business Conduct Standards for Security-Based Swap Dealers and Major

Security-Based Swap Participants (Release No. 34-64766, File No. S7-2511)

8/29/2011

10/24/2011

Registration of Security-Based Swap Dealers and Major Security-Based

Swap Participants (Release No. 34-65543, File No. S7-40-11)

12/19/2011

6/14/2012

Statement of General Policy on the Sequencing of the Compliance Rules

Applicable to the Security-Based Swaps Adopted Pursuant to the Securities

Exchange Act of 1934 and the Dodd-Frank Wall Street Reform and

Consumer Protection Act (Release No. 34-67177, File No. S7-05-12)

8/13/2012

11/23/2012

Capital, Margin, and Segregation Requirements for Security-Based Swap

Dealers and Major Security-Based Swap Participants and Capital

Requirements for Broker-Dealers (Release No. 34-68071, File No. S7-0812) and Extension of Comment Period (Release No. 34-68660)

2/22/2013

8

All comments received to date on the Proposed Rules and the Policy Statement will be

considered and need not be resubmitted.

By the Commission.

Elizabeth M. Murphy

Secretary

Date: May 1, 2013

9