May 22, 2020
Mr. Christopher Kirkpatrick
Secretary of the Commission
Commodity Futures Trading Commission
Three Lafayette Centre
1155 21st Street NW
Washington, DC 20581
Comments on the Proposed Rule: Amendments to the Swap Data Recordkeeping andReporting Requirements (RIN 3038-AE31)
Dear Mr. Kirkpatrick:We, the Japanese Bankers Association (JBA), would like to express our gratitude for thisopportunity to comment on the Proposed Rule: “Amendments to the Swap Data Recordkeeping
and Reporting Requirements” (“Amendments”) issued by the Commodity Futures Trading
Commission (CFTC) on February 20, 2020. We respectfully expect that the following comments
will contribute to your further discussion.
[General Comments]
We generally support the Amendments since our understanding is that it proposes to review thedefinitions, simplify the reporting requirements and introduce new requirements regarding swap
identifiers in consideration of the “Roadmap to Achieve High Quality Swaps Data” announced
in July 2017 and relevant international swap data harmonization efforts. From a perspective ofreporting entities, however, we respectfully request that the CFTC fully consider the followings
in finalizing the rule.
 Consideration to regulatory implementation by other jurisdictions
It is our understanding that one of the reasons that the CFTC amend its rules is
consideration to global harmonization advocated by the Financial Stability Board as wellas the Committee on Payments and Market Infrastructures (CPMI) and the International
Organization of Securities Commissions (IOSCO). Significant elements of such global
harmonization would be the implementation timeline and technical details of the rules. In
that respect, we have a strong concern over Unique Transaction Identifiers (UTIs), inparticular, and would like to make the following requests.
(1) Implementation timeline of UTIs
The Amendments state that the CFTC expects to implement the rules on UTIs on

December 31, 2020 in accordance with the international agreement. However, some of thejurisdictions that were initially planning to implement UTIs in April 2020 have deferred
the implementation. 123 A suggestion is also raised in ESMA consultation that aconsiderable period of time is needed for the implementation4. It is, therefore, realistic toconsider that only a few major jurisdictions will be able to implement UTIs by the end of2020.
If the U.S. implements UTIs ahead of others at the end of 2020 while other jurisdictions
have not established a UTI generation framework, it may create confusion with regard tothe treatment of UTIs in cross-border transactions. Taking into consideration that the UTI
generation responsibility is determined on a transaction-by-transaction basis, aligning theimplementation timeline across jurisdictions will be more beneficial relative to otherregulations. The UTI implementation timeline, therefore, should be finalized afterdeliberation across national competent authorities with due consideration of thepreparation period needed for the implementation.
With respect to the Unique Product Identifier (UPI) and critical data elements other than
UTI and UPI (CDE), the international agreement assumes the implementation of themaround the autumn of 2022 whereas the U.S. assumes one year from the final rulemakings.
Since market participants would need a considerable amount of time and funds for costs
to establish necessary processes and procedures (e.g. system updates), we request theCFTC to determine the implementation timeline after due consideration to allow asufficient preparation period.
We would like to suggest, as one of the best solutions, that the implementation timeline ofUTI be deferred to coincide with that of UPI and CDE, in light of proposals offered in theESMA consultation. That would promote preparations, such as for system developments,
efficiently among market participants.
(2) UTI implementation rules
The rules for determining the UTI generation responsibility for some transactions in theAmendments are slightly modified from the IOSCO’s Technical Guidance to more
accommodate practical needs. However, if other jurisdictions apply different UTI
1HKMA and SFC (March 2020) Notice - Mandating the use of Unique Transaction Identifier for the reportingobligation
2ASIC(March 2020) ASIC Corporations (Amendment) Instrument 2020/242
3MAS(February 2020) Securities and Futures (Reporting of Derivatives Contracts) (Amendment) Regulations
2020
4ESMA (March 2020) Consultation regarding Technical standards on reporting, data quality, data access andregistration of Trade Repositories under EMIR REFIT

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generation rules by, for example, faithfully adopting that of the IOSCO’s, suchinconsistencies in UTI generation rules may give rise to confusion in cross-bordertransactions. We therefore request the CFTC to give due consideration, in particular, to thecomments to be provided by market participants on the Amendments.
Especially, in the case of cross-jurisdictional swaps, the Amendments require the use of a
UTI generated according to the rules of the jurisdiction with the earliest reporting deadline
for CFTC reporting purposes. If other jurisdictions with a regulatory reporting deadline
earlier than the deadline of the CFTC rules do not mandate the UTI or do use an identifierdifferent from the UTI required under the CFTC rules or global rules, it would be difficult
for a counterparty in such jurisdictions to generate a UTI. From practical perspectives, notonly static data (e.g. the counterparty’s country of incorporation, registration as a dealer)
but many other elements (e.g. the locations of arrangement, negotiation and execution ofeach transaction, the location of booking and the business day convention) havecomplicated effects on the determination. It is therefore difficult to accurately identify thereporting deadline of each counterparty’s jurisdiction.
In view of the above, designing flexible rules5, such as allowing a change to the UTI
generation responsibility in accordance with a bilateral agreement, would avoid doublecounting of the same transaction and meet the regulatory goal of collecting accuratetransaction data.

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Another possible option would be to adopt a logic that enables easy determination of the UTI responsibility(e.g. Payer/Receiver, Seller/Buyer) and that can be easily implemented in systems in a similar manner with theexisting ISDA Tie Breaker Logic.

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[Comments to the Questions]II. Proposed Amendments to Part 45
A. § 45.1 – Definitions(1) Does the Commission’s proposed definition of “execution date” present problems for
SEFs, DCMs, SDRs, or reporting counterparties? Should the Commission instead
adopt a definition that aligns with other regulations, including, for instance, the definitionof “day of execution” in § 23.501(a)(5)(i)?

(Comment)
It is considered that the proposed definition of “execution date” presents problems as it isdetermined by reference to eastern time (EST). In light of its use at the global level and ensuringconsistency, the execution date should be determined by reference to Coordinated Universal
Time (UTC). Furthermore, we request the CFTC to also apply UTC to other required swap dataelements (e.g. Execution timestamp, Valuation timestamp) consistently although theAmendments do not specify the time standard applicable to such timestamps.
(Rationale)
The Amendments clarify a definition of “execution date” to §45.1, specifying that it “wouldmean the date, determined by reference to eastern time, on which swap execution has occurred.”This, however, is inconsistent with the global norm. For example, the CDE Technical Guidance
stipulates that the execution timestamp is based on UTC and the final report on “ClockSynchronisation” published by IOSCO in January 2020 recommends that business clocks should
be synchronised to UTC as well.
If the Amendments adopt EST without considering global consistency or globally unified
definition, certain locations of reporting entities may unevenly bear burdens (due to the timelag), and excessive practical burdens may incur due to summer time adjustments, systemmodifications and reporting differences from other jurisdictions.
D. § 45.4 – Swap Data Reporting: Continuation Data(7) Does the Commission’s proposal to no longer require non-SD/MSP/DCO reporting
counterparties to report valuation data raise any concerns about the Commission’s ability
to monitor systemic risk in the U.S. swaps market?

(Comment)
We have no particular concern in this respect and support the proposal.
(Rationale)
As the activities by non-SD/MSP/DCO reporting counterparties in the U.S. swaps market arelimited, they would not raise any concerns about the CFTC’s ability to monitor systemic risk.
4H. § 45.10 – Reporting to a Single SDR(10) Would the Commission’s proposal to permit reporting counterparties to change SDRs
raise any operational issues for reporting counterparties, SDRs, or non-reporting
counterparties?

(Comment)
Changing SDRs would not raise any particular concern. It is, however, preferable to ensure
consistency between SDRs in terms of data elements and formats with a view to simplifying theprocess for changing SDRs.
K. § 45.13 – Required Data Standards(14) The CPMI-IOSCO Governance Arrangements for critical OTC derivatives dataelements (other than UTI and UPI) (“CDE Governance Arrangements”), assigned ISO toexecute the maintenance functions for the CDE data elements included in the CDE
Technical Guidance. Some of the reasons include that almost half of the CDE dataelements are already tied to an ISO standard and because ISO has significant experience
maintaining data standards, specifically in financial services. CPMI and IOSCO, in the CDE
Governance Arrangements, also decided that the CDE data elements should be included inthe ISO 20022 data dictionary and supported the development of an ISO 20022-compliant
message for CDE data elements. Given these factors, should the Commission consider
mandating ISO 20022 message scheme for reporting to SDRs?

(Comment)
The CFTC should consider global harmonization in determining whether to mandate ISO 20022
message scheme.
(Rationale)
We have no objection to the adoption of ISO 20022 message scheme from the perspective ofdata standardization as it is an international agreement. Nonetheless, if ISO 20022 message
scheme is mandated while some jurisdictions do not adopt the scheme, entities would need toprepare duplicated reporting data, one is for such jurisdictions and the other is for the CFTC,
which may give rise to confusion. It is therefore advisable to ensure harmonization at the globallevel.
[Others]
 Consideration of changes to the requirement for obtaining an LEI
In §45.6, each derivatives clearing organization (DCO) and each financial entity reporting
counterparty executing a swap with a counterparty that does not have an LEI is obligated tocause, prior to reporting any required swap creation data for such swap, an LEI to be assigned
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to the counterparty including if necessary through third-party registration. Obtaining an LEI on
behalf of the counterparty is significantly impractical due to its costs, the possibility ofoverlapped LEI acquisition and other relevant factors. We therefore request that the CFTC
consider changing this requirement so that it will be sufficient for the DCO and financial entities
to “recommend” the counterparty to obtain an LEI or to take other similar actions.
 Clarification of “in the manner provided in § 45.13(b) each business day”
§45.13 referred to in the proposed §45.4(c)(2) is a provision pertaining to data validation anddoes not specify the reporting and valuation deadlines. In the case of reporting swap valuation
data, we would like the CFTC to clarify the base date for the valuation rate and the reporting
deadline of such data.
 Changes to the additional validation requirements (the deadline for re-submitting thereport when it does not satisfy the data validation procedures of the swap datarepository (SDR))
With respect to the re-submission of the required swap data report to the SDR when the initialreport has not satisfied the SDR’s data validation procedures and notification of data validation
error message was sent, we request that the CFTC consider allowing entities to re-submit thereport “as soon as practicable after recognition of the notification” or “within a certain timeframe
after recognition of the notification,” instead of “within the applicable time deadline” asproposed in §45.13(b). This request is made on the basis that it is necessary to consider eachjurisdiction’s holidays, such notifications by SDR cannot be identified by systems on a real-timebasis in some cases and the proposed deadline causes a significant burden.

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