CFTC Chairman Releases White Paper on “Cross-Border Swaps Regulation Version 2.0”: White Paper Proposes New Approach to Providing Exemptions and Other Relief from CFTC’s Dodd-Frank Swaps Rules for Certain Non-U.S. Clearinghouses, Trading Venues, and Swap Dealing Businesses

Sullivan & Cromwell LLP - October 5, 2018

On October 1, 2018, Commodity Futures Trading Commission (“CFTC”) Chairman Christopher Giancarlo released a White Paper titled “Cross-Border Swaps Regulation Version 2.0: A Risk-Based Approach with Deference to Comparable Non-U.S. Regulation” (the “White Paper”). The release of the White Paper follows Chairman Giancarlo’s remarks at a City of London event on September 4, 2018 and directs the CFTC to modify its approach to cross-border regulation in a way that is “better calibrated to mitigate systemic risk” and that fosters “innovation, competition, and international cooperation.” The White Paper begins with a broad review of U.S. and global swaps reform efforts and then sets forth a set of principles to guide the cross-border application of the CFTC’s Dodd-Frank swaps rules. Next, it reviews the CFTC’s approach to applying its Dodd-Frank swaps rules in the cross-border context and recommends a series of improvements, exemptions and relief that would address non-U.S. clearinghouses, trading venues, and swap dealing businesses.