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[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[S. 1691 Introduced in Senate (IS)]

111th CONGRESS
  1st Session
                                S. 1691

      To comprehensively regulate derivatives markets to increase 
         transparency and reduce risks in the financial system.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                           September 22, 2009

   Mr. Reed introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL

 
      To comprehensively regulate derivatives markets to increase 
         transparency and reduce risks in the financial system.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Comprehensive 
Derivatives Regulation Act of 2009''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings.
           TITLE I--REGULATION OF SECURITY-BASED DERIVATIVES

Sec. 101. Definitions.
Sec. 102. Rationalization of financial product oversight.
Sec. 103. Required clearing of standardized derivative through central 
                            counterparties and the use of trade 
                            repositories.
Sec. 104. Prudential supervision and regulation of significant 
                            security-based derivatives market 
                            participants and incentives for trading on 
                            regulated exchanges.
Sec. 105. Recordkeeping and reporting requirements for derivatives 
                            market participants.
Sec. 106. Prohibition of market manipulation, fraud, and other market 
                            abuses.
Sec. 107. Protections for marketing security-based swaps to certain 
                            persons.
Sec. 108. Enforcement.
Sec. 109. Enforceability of security-based swaps.
Sec. 110. Transfer and rights of certain CFTC employees.
          TITLE II--REGULATION OF COMMODITY-BASED DERIVATIVES

Sec. 201. Definitions.
Sec. 202. Rationalization of financial product oversight.
Sec. 203. Required clearing of standardized derivatives through central 
                            counterparties and use of trade 
                            repositories.
Sec. 204. Prudential supervision and regulation of significant 
                            commodity-based derivatives market 
                            participants and incentives for trading on 
                            regulated exchanges.
Sec. 205. Recordkeeping and reporting requirements for derivatives 
                            market participants.
Sec. 206. Prohibition of market manipulation, fraud, and other market 
                            abuses.
Sec. 207. Protections for marketing commodity-based swaps to certain 
                            persons.
Sec. 208. Commodity-based swap execution facilities.
Sec. 209. Enforcement.
Sec. 210. Enforceability of commodity-based swaps.
                      TITLE III--OTHER PROVISIONS

Sec. 301. Margining and other risk management standards for central 
                            counterparties.
Sec. 302. Determining the status of swaps.
Sec. 303. Study and report on implementation.
Sec. 304. Rulemaking.
Sec. 305. Effective date.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) in recent years, the over-the-counter derivatives 
        market has grown rapidly, but regulators have lacked key 
        information and adequate authority to address systemic and 
        other risks posed by unregulated derivatives trading;
            (2) excessive risk taking among market participants, 
        combined with limited regulatory oversight of such products, 
        was a significant cause of the recent financial crisis;
            (3) lack of transparency in the markets has contributed to 
        market instability and uncertainty, and has resulted in a less 
        efficient marketplace;
            (4) customized derivative products provide key benefits to 
        certain market participants and should be permitted under 
        comprehensive regulation, but all derivatives activities should 
        be accompanied by appropriate risk management and prudential 
        standards; and
            (5) the trading of derivatives on regulated exchanges 
        should be encouraged because of the significant associated 
        market efficiencies.

           TITLE I--REGULATION OF SECURITY-BASED DERIVATIVES

SEC. 101. DEFINITIONS.

    (a) Definitions Under the Securities Exchange Act of 1934.--Section 
3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)) is 
amended--
            (1) in paragraph (10), by inserting ``security-based 
        swap,'' after ``security future,'';
            (2) in paragraph (13), by adding at the end the following: 
        ``For any security-based swap, such terms include the 
        execution, termination (prior to its scheduled maturity date), 
        assignment, exchange, or similar transfer or conveyance of, or 
        extinguishing of rights or obligations under, a security-based 
        swap, as the context may require.'';
            (3) in paragraph (14), by adding at the end the following: 
        ``For any security-based swap, such terms include the 
        execution, termination (prior to its scheduled maturity date), 
        assignment, exchange, or similar transfer or conveyance of, or 
        extinguishing of rights or obligations under, a security-based 
        swap, as the context may require.''; and
            (4) by adding at the end the following:
            ``(65) Derivative.--The term `derivative' means--
                    ``(A) any future, forward, swap, warrant, put, 
                call, straddle, option, or privilege on or related to--
                            ``(i) any security, or group or index of 
                        securities (including any interest therein or 
                        based on the value thereof); or
                            ``(ii) any issuer of securities or group or 
                        index of issuers of securities (including any 
                        interest therein or based on the value 
                        thereof); and
                    ``(B) any contract of sale for future delivery of 
                any commodity (or option on such contract).
            ``(66) Swap.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the term `swap' means any agreement, 
                contract, or transaction that--
                            ``(i) is a put, call, cap, floor, collar, 
                        or similar option of any kind for the purchase 
                        or sale of, or based on the value of, 1 or more 
                        interest or other rates, currencies, 
                        commodities, indices, quantitative measures, or 
                        other financial or economic interests or 
                        property of any kind;
                            ``(ii) provides for any purchase, sale, 
                        payment, or delivery (other than a dividend on 
                        an equity security) that is dependent on the 
                        occurrence, nonoccurrence, or the extent of the 
                        occurrence of an event or contingency 
                        associated with a potential financial, 
                        economic, or commercial consequence;
                            ``(iii) provides on an executory basis for 
                        the exchange, on a fixed or contingent basis, 
                        of 1 or more payments based on the value or 
                        level of 1 or more interest or other rates, 
                        currencies, commodities, securities, 
                        instruments of indebtedness, indices, 
                        quantitative measures, or other financial or 
                        economic interests or property of any kind, or 
                        any interest therein or based on the value 
                        thereof, and that transfers, as between the 
                        parties to the transaction, in whole or in 
                        part, the financial risk associated with a 
                        future change in any such value or level 
                        without also conveying a current or future 
                        direct or indirect ownership interest in an 
                        asset (including any enterprise or investment 
                        pool) or liability that incorporates the 
                        financial risk so transferred, any such 
                        agreement, contract, or transaction commonly 
                        known as an interest rate swap, including a 
                        rate floor, rate cap, rate collar, cross-
                        currency rate swap, basis swap, currency swap, 
                        equity index swap, equity swap, debt index 
                        swap, debt swap, credit spread, credit default 
                        swap, credit swap, weather swap, energy swap, 
                        metal swap, agricultural swap, emissions swap, 
                        or commodity swap;
                            ``(iv) is an agreement, contract, or 
                        transaction that is, or in the future becomes, 
                        commonly known to the trade as a swap; or
                            ``(v) is any combination or permutation of, 
                        or option on, any agreement, contract, or 
                        transaction described in any of clauses (i) 
                        through (iv).
                    ``(B) Exclusions.--The term `swap' does not 
                include--
                            ``(i) any contract of sale for future 
                        delivery traded on or subject to the rules of 
                        any board of trade designated as a contract 
                        market under section 5 of the Commodity 
                        Exchange Act (7 U.S.C. 7)--
                                    ``(I) on a commodity other than a 
                                security; or
                                    ``(II) that is not based on or 
                                subject to the occurrence of a bona 
                                fide contingency that might reasonably 
                                be expected to affect or be affected by 
                                the creditworthiness of a party other 
                                than a party to such contract;
                            ``(ii) any sale of any cash commodity or 
                        security for deferred or delayed shipment or 
                        delivery;
                            ``(iii) any put, call, straddle, option, or 
                        privilege on any security, certificate of 
                        deposit, or group or index of securities, 
                        including any interest therein or based, in 
                        whole or in part, on the value thereof, whether 
                        physically or cash settled;
                            ``(iv) any put, call, straddle, option, or 
                        privilege entered into on a national securities 
                        exchange registered pursuant to section 6(a) 
                        relating to foreign currency;
                            ``(v) any agreement, contract, or 
                        transaction providing for the purchase or sale 
                        of 1 or more securities on a fixed basis, 
                        whether physically or cash settled;
                            ``(vi) any agreement, contract, or 
                        transaction providing for the purchase or sale 
                        of 1 or more securities on a contingent basis, 
                        unless such agreement, contract, or transaction 
                        predicates such purchase or sale on the 
                        occurrence of a bona fide contingency that 
                        might reasonably be expected to affect or be 
                        affected by the creditworthiness of a party 
                        other than a party to the agreement, contract, 
                        or transaction;
                            ``(vii) any note, bond, or evidence of 
                        indebtedness that is a security (as defined in 
                        section 2(a)(1) of the Securities Act of 1933 
                        (15 U.S.C. 77b(a)(1)) or paragraph (10) of this 
                        subsection);
                            ``(viii) any agreement, contract, or 
                        transaction that is--
                                    ``(I) based on, or references, a 
                                security; and
                                    ``(II) entered into directly or 
                                through an underwriter (as defined in 
                                section 2(a)(11) of the Securities Act 
                                of 1933 (15 U.S.C. 77b(a)(11))) by the 
                                issuer of such security;
                            ``(ix) any security future product (as 
                        defined in paragraph (56));
                            ``(x) any hybrid instrument that is 
                        predominantly a banking product, as provided in 
                        section 405 of the Commodity Futures 
                        Modernization Act of 2000 (Public Law 106-554; 
                        114 Stat. 2763A-455), or any hybrid instrument 
                        that is predominantly a security, as provided 
                        in section 2(f) of the Commodity Exchange Act 
                        (as in effect on the day before the date of 
                        enactment of the Comprehensive Derivatives 
                        Regulation Act of 2009);
                            ``(xi) any agreement, contract, or 
                        transaction that is an insurance or endowment 
                        policy or annuity contract or optional annuity 
                        contract issued by a corporation that is 
                        subject to the supervision of the insurance 
                        commissioner, bank commissioner, or any agency 
                        or officer performing like functions, of any 
                        State; or
                            ``(xii) any identified banking product 
                        specified in paragraphs (1) through (5) of 
                        section 206(a) of the Gramm-Leach-Bliley Act 
                        (15 U.S.C. 78c note), mortgage or mortgage 
                        purchase commitment, or any sale of installment 
                        loan contracts or receivables, if any such 
                        product or instrument is not marketed or sold 
                        as an alternative to a swap.
            ``(67) Eligible contract participant.--The term `eligible 
        contract participant' means--
                    ``(A) acting for its own account--
                            ``(i) a financial institution (as defined 
                        in section 1a(15) of the Commodity Exchange Act 
                        (7 U.S.C. 1(a)(15)), as in effect on the day 
                        before the date of enactment of the 
                        Comprehensive Derivatives Regulation Act of 
                        2009);
                            ``(ii) an insurance company that is 
                        regulated by a State, or that is regulated by a 
                        foreign government and is subject to comparable 
                        regulation, as determined by the Commission, 
                        including a regulated subsidiary or affiliate 
                        of such an insurance company;
                            ``(iii) an investment company that is 
                        subject to regulation under the Investment 
                        Company Act of 1940 (15 U.S.C. 80a-1 et seq.) 
                        or a foreign person performing a similar role 
                        or function subject as such to foreign 
                        regulation (regardless of whether each investor 
                        in the investment company or the foreign person 
                        is itself an eligible contract participant);
                            ``(iv) a commodity pool that--
                                    ``(I) has total net assets 
                                exceeding $5,000,000; and
                                    ``(II) is formed and operated by a 
                                person that is subject to regulation 
                                under the Commodity Exchange Act (7 
                                U.S.C. 1 et seq.) or a foreign person 
                                performing a similar role or function 
                                subject as such to foreign regulation 
                                (regardless of whether each investor in 
                                the commodity pool or the foreign 
                                person is itself an eligible contract 
                                participant);
                            ``(v) a corporation, partnership, 
                        proprietorship, organization, trust, or other 
                        entity--
                                    ``(I) that has total net assets 
                                exceeding $10,000,000; or
                                    ``(II) that--
                                            ``(aa) has total net assets 
                                        exceeding $5,000,000; and
                                            ``(bb) enters into an 
                                        agreement, contract, or 
                                        transaction in connection with 
                                        the conduct of the business of 
                                        the entity or to manage the 
                                        risk associated with an asset 
                                        or liability owned or incurred 
                                        or reasonably likely to be 
                                        owned or incurred by the entity 
                                        in the conduct of the business 
                                        of the entity;
                            ``(vi) an employee benefit plan that is 
                        subject to the Employee Retirement Income 
                        Security Act of 1974 (29 U.S.C. 1001 et seq.), 
                        a governmental employee benefit plan, or a 
                        foreign person performing a similar role or 
                        function that is subject as such to foreign 
                        regulation--
                                    ``(I) that has total assets 
                                exceeding $5,000,000; or
                                    ``(II) the investment decisions of 
                                which are made by--
                                            ``(aa) an investment 
                                        adviser or commodity trading 
                                        advisor that is subject to 
                                        regulation under the Investment 
                                        Advisers Act of 1940 (15 U.S.C. 
                                        80b-1 et seq.) or the Commodity 
                                        Exchange Act (7 U.S.C. 1 et 
                                        seq.);
                                            ``(bb) a foreign person 
                                        performing a similar role or 
                                        function that is subject as 
                                        such to foreign regulation;
                                            ``(cc) a financial 
                                        institution (as defined in 
                                        section 1a(15) of the Commodity 
                                        Exchange Act (7 U.S.C. 
                                        1(a)(15)), as in effect on the 
                                        day before the date of 
                                        enactment of the Comprehensive 
                                        Derivatives Regulation Act of 
                                        2009); or
                                            ``(dd) an insurance company 
                                        described in clause (ii), or a 
                                        regulated subsidiary or 
                                        affiliate of such an insurance 
                                        company;
                            ``(vii)(I) a governmental entity (including 
                        the United States, a State, or a foreign 
                        government) or political subdivision of a 
                        governmental entity;
                            ``(II) a multinational or supranational 
                        government entity; or
                            ``(III) an instrumentality, agency, or 
                        department of an entity described in subclause 
                        (I) or (II),
                        except that such term does not include an 
                        entity, political subdivision, instrumentality, 
                        agency, or department referred to in subclause 
                        (I) or (III), unless the entity, political 
                        subdivision, instrumentality, agency, or 
                        department owns and invests on a discretionary 
                        basis $50,000,000 or more in investments, 
                        provided that, with respect to any State or 
                        entity, political subdivision, agency, or 
                        department of a State, such amount is exclusive 
                        of any proceeds from any offering of municipal 
                        securities;
                            ``(viii)(I) a broker or dealer that is 
                        subject to regulation under this title or a 
                        foreign person performing a similar role or 
                        function that is subject as such to foreign 
                        regulation, except that, if the broker or 
                        dealer or foreign person is a natural person or 
                        proprietorship, the broker or dealer or foreign 
                        person shall not be considered to be an 
                        eligible contract participant, unless the 
                        broker or dealer or foreign person also meets 
                        the requirements of clause (v) or (xi);
                            ``(II) an associated person of a registered 
                        broker or dealer concerning the financial or 
                        securities activities, of which, the registered 
                        person makes and keeps records under section 
                        15C(b) or 17(h); and
                            ``(III) an investment bank holding company 
                        (as defined in section 17(i));
                            ``(ix) a futures commission merchant that 
                        is subject to regulation under the Commodity 
                        Exchange Act or a foreign person performing a 
                        similar role or function that is subject as 
                        such to foreign regulation, except that, if the 
                        futures commission merchant or foreign person 
                        is a natural person or proprietorship, the 
                        futures commission merchant or foreign person 
                        shall not be considered to be an eligible 
                        contract participant, unless the futures 
                        commission merchant or foreign person also 
                        meets the requirements of clause (v) or (xi);
                            ``(x) a floor broker or floor trader that 
                        is subject to regulation under the Commodity 
                        Exchange Act in connection with any transaction 
                        that takes place on or through the facilities 
                        of a registered entity (as defined in section 
                        1a(29) of the Commodity Exchange Act (7 U.S.C. 
                        1(a)(29)), as in effect on the day before the 
                        date of enactment of the Comprehensive 
                        Derivatives Regulation Act of 2009, other than 
                        an electronic trading facility with respect to 
                        a significant price discovery contract), or an 
                        exempt board of trade operating under section 
                        5d of the Commodity Exchange Act (7 U.S.C. 7a-
                        3), or any affiliate thereof, on which such 
                        person regularly trades; or
                            ``(xi) a natural person who--
                                    ``(I) owns and invests on a 
                                discretionary basis not less than 
                                $10,000,000;
                                    ``(II) owns and invests on a 
                                discretionary basis not less than 
                                $5,000,000 and who enters into the 
                                agreement, contract, or transaction in 
                                order to manage the risk associated 
                                with an asset owned or liability 
                                incurred, or reasonably likely to be 
                                owned or incurred, by the individual; 
                                or
                                    ``(III) is an officer or director 
                                of an entity (or a person performing 
                                similar functions) and who enters into 
                                the agreement, contract, or transaction 
                                in order to manage the risk associated 
                                with the securities of such entity 
                                owned by the individual at the time of 
                                entering into the agreement, contract, 
                                or transaction;
                    ``(B)(i) a person described in clause (i), (ii), 
                (iv), (v), (viii), (ix), or (x) of subparagraph (A) or 
                in subparagraph (C), acting as broker or performing an 
                equivalent agency function on behalf of another person 
                described in subparagraph (A) or (C); or
                    ``(ii) an investment adviser that is subject to 
                regulation under the Investment Advisers Act of 1940 
                (15 U.S.C. 80b-1 et seq.), a commodity trading advisor 
                that is subject to regulation under the Commodity 
                Exchange Act (7 U.S.C. 1 et seq.), a foreign person 
                performing a similar role or function that is subject 
                as such to foreign regulation, or a person described in 
                clause (i), (ii), (iv), (v), (viii), (ix), or (x) of 
                subparagraph (A) or in subparagraph (C), in any such 
                case acting as investment manager or fiduciary (but 
                excluding a person acting as broker or performing an 
                equivalent agency function) for another person 
                described in subparagraph (A) or (C) and who is 
                authorized by such person to commit such person to the 
                transaction; or
                    ``(C) any other person that the Commission 
                determines by rule, jointly with the Commodity Futures 
                Trading Commission, to be an eligible contract 
                participant, in light of the financial or other 
                qualifications of the person.
            ``(68) Person associated with a significant security-based 
        derivatives market participant.--
                    ``(A) In general.--The term `person associated with 
                a significant security-based derivatives market 
                participant' or `associated person of a significant 
                security-based derivatives market participant' means--
                            ``(i) any partner, officer, director, or 
                        branch manager of a significant security-based 
                        derivatives market participant (including any 
                        individual who holds a similar status or 
                        performs a similar function with respect to any 
                        partner, officer, director, or branch manager 
                        of a significant security-based derivatives 
                        market participant);
                            ``(ii) any person that directly or 
                        indirectly controls, is controlled by, or is 
                        under common control with a significant 
                        security-based derivatives market participant; 
                        and
                            ``(iii) any employee of a significant 
                        security-based derivatives market participant.
                    ``(B) Exclusion.--Other than for purposes of 
                section 15F(e)(2), the term `person associated with a 
                significant commodity-based derivatives market 
                participant' or `associated person of a significant 
                security-based derivatives market participant' does not 
                include any person associated with a significant 
                security-based derivatives market participant, the 
                functions of which are solely clerical or ministerial.
            ``(69) Security derivative.--The term `security derivative' 
        means--
                    ``(A) any derivative, other than a derivative 
                instrument swap, on or related to--
                            ``(i) any security, or group or index of 
                        securities (including any interest therein or 
                        based on the value thereof); or
                            ``(ii) any issuer of securities or group or 
                        index of issuers of securities (including any 
                        interest therein or based on the value 
                        thereof); and
                    ``(B) any security that the Commission by rule, 
                regulation, or order determines is a security 
                derivative.
            ``(70) Security-based swap.--The term `security-based swap' 
        means a swap, of which a material term--
                    ``(A) is based on the price, yield, value, or 
                volatility of any security or any group or index of 
                securities, or any interest therein, other than 
                interest rate or currency;
                    ``(B) is dependent on the occurrence, 
                nonoccurrence, or the extent of the occurrence of an 
                event or contingency associated with a potential 
                financial, economic, or commercial consequence that is 
                related to or based on a security, an interest in a 
                security, an issuer of a security, or group or index of 
                securities, or interests in securities or issuers of 
                securities, or based on the value of any of the 
                foregoing;
                    ``(C) provides for the purchase or sale of 1 or 
                more securities on a contingent basis, whether 
                physically or cash settled, if such agreement, 
                contract, or transaction predicates such purchase or 
                sale on the occurrence of a bona fide contingency that 
                might reasonably be expected to affect or be affected 
                by the creditworthiness of a party other than a party 
                to the agreement, contract, or transaction; or
                    ``(D) allows for settlement of the swap by delivery 
                of, or by reference to, any security.
            ``(71) Significant security-based derivatives market 
        participant.--The term `significant security-based derivatives 
        market participant' means--
                    ``(A) any person (other than an investment company 
                registered under the Investment Company Act of 1940) 
                that is engaged in the business of purchasing or 
                selling one or more security-based swaps (or security 
                derivatives, as the Commission determines by rule, 
                regulation, or order) for such person's own account or 
                for others, or making a market in security-based swaps 
                (or security derivatives, as the Commission determines 
                by rule, regulation, or order), the purchases or sales 
                of which are not solely for the purpose of managing the 
                risk associated with--
                            ``(i) an asset that is or is anticipated to 
                        be owned, produced, manufactured, processed, or 
                        merchandised;
                            ``(ii) potential changes in the value of 
                        services to be purchased or provided, or 
                        anticipated to be purchased or provided; or
                            ``(iii) a liability incurred or anticipated 
                        to be incurred by such person that is not, or 
                        is not related to, a security-based swap; or
                    ``(B) any other person designated by the 
                Commission, by rule, regulation, or order, after 
                consultation with the Commodity Futures Trading 
                Commission, as necessary or appropriate in the public 
                interest, the protection of investors, or in 
                furtherance of the purposes of this title.
            ``(72) Trade repository.--The term `trade repository' means 
        any person that collects, calculates, processes, or prepares 
        information with respect to transactions or positions in 
        security-based swaps or security derivatives by the Commission 
        under section 17C(d)(1)(A)(ii).''.
    (b) Definitions Under the Securities Act of 1933.--Section 2(a) of 
the Securities Act of 1933 (15 U.S.C. 77b(a)) is amended--
            (1) in paragraph (1), by inserting ``security-based swap,'' 
        after ``security future,'';
            (2) in paragraph (3), by adding at the end the following: 
        ``Any offer or sale of a security-based swap (or other security 
        derivative as the Commission determines by rule or regulation) 
        by or on behalf of the issuer of the securities upon which such 
        security-based swap or security derivative is based or is 
        referenced, an affiliate of the issuer, or an underwriter, 
        shall constitute a contract for sale of, sale of, offer for 
        sale, or offer to sell such securities.''; and
            (3) by adding at the end the following:
            ``(17) The terms `derivative', `swap', `security 
        derivative' and `security-based swap' have the same meanings as 
        in paragraphs (65), (66), (69), and (70), respectively, of 
        section 3(a) of the Securities Exchange Act of 1934.
            ``(18) The terms `purchase' or `sale' of a security-based 
        swap, shall be deemed to mean the execution, termination (prior 
        to its scheduled maturity date), assignment, exchange, or 
        similar transfer or conveyance of, or extinguishing of rights 
        or obligations under, a security-based swap, as the context may 
        require.''.

SEC. 102. RATIONALIZATION OF FINANCIAL PRODUCT OVERSIGHT.

    (a) Repeal of Swap Agreement Exclusion.--
            (1) Repeal of laws.--The following provisions of law are 
        repealed:
                    (A) Sections 206A, 206B, and 206C of the Gramm-
                Leach-Bliley Act (15 U.S.C. 78c note).
                    (B) Section 2A of the Securities Act of 1933 (15 
                U.S.C. 77b-1).
                    (C) Section 17(d) of the Securities Act of 1933 (15 
                U.S.C. 77q(d)).
                    (D) Section 3A of the Securities Exchange Act of 
                1934 (15 U.S.C. 78c-1).
                    (E) Section 9(i) of the Securities Exchange Act of 
                1934 (15 U.S.C. 78i(i)).
                    (F) Section 15(i) of the Securities Exchange Act of 
                1934 (15 U.S.C. 78o(i)), as added by section 303(f) of 
                the Commodity Futures Modernization Act of 2000 (Public 
                Law 106-554; 114 Stat. 2763A-455).
                    (G) Section 16(g) of the Securities Exchange Act of 
                1934 (15 U.S.C. 78p(g)).
                    (H) Section 20(f) of the Securities Exchange Act of 
                1934 (15 U.S.C. 78t(f)).
                    (I) Section 21A(g) of the Securities Exchange Act 
                of 1934 (15 U.S.C. 78u-1(g)).
            (2) Conforming amendment to the securities act of 1933.--
        Section 17(a) of the Securities Act of 1933 (15 U.S.C. 77q(a)) 
        is amended by striking ``or any security-based swap agreement 
        (as defined in section 206B of the Gramm-Leach-Bliley Act)''.
            (3) Conforming amendments to the securities exchange act of 
        1934.--The Securities Exchange Act of 1934 (15 U.S.C. 78a et 
        seq.) is amended--
                    (A) in section 9(a) (15 U.S.C. 78i(a))--
                            (i) in paragraph (1)--
                                    (I) by striking ``For the'' and 
                                inserting ``for the''; and
                                    (II) by striking the period at the 
                                end an inserting a semicolon; and
                            (ii) by striking paragraphs (2) through (5) 
                        and inserting the following:
            ``(2) to effect, alone or with 1 or more other persons, a 
        series of transactions in any security registered on a national 
        securities exchange or in connection with any security-based 
        swap (or security derivative, as the Commission determines by 
        rule, regulation, or order) with respect to such security 
        creating actual or apparent active trading in such security, or 
        raising or depressing the price of such security, for the 
        purpose of inducing the purchase or sale of such security by 
        others;
            ``(3) if a broker or dealer, or other person selling or 
        offering for sale or purchasing or offering to purchase the 
        security to induce the purchase or sale of any security 
        registered on a national securities exchange or any security-
        based swap (or security derivative, as the Commission 
        determines by rule, regulation, or order) with respect to such 
        security by the circulation or dissemination in the ordinary 
        course of business of information to the effect that the price 
        of any such security will or is likely to rise or fall because 
        of market operations of any 1 or more persons conducted for the 
        purpose of raising or depressing the price of such security;
            ``(4) if a broker or dealer, or the person selling or 
        offering for sale or purchasing or offering to purchase the 
        security, to make, regarding any security registered on a 
        national securities exchange or any security-based swap (or 
        security derivative, as the Commission determines by rule, 
        regulation, or order) with respect to such security, for the 
        purpose of inducing the purchase or sale of such security or 
        such security-based swap (or security derivative, as the 
        Commission determines by rule, regulation, or order), any 
        statement which was, at the time and in the light of the 
        circumstances under which it was made, false or misleading with 
        respect to any material fact, and which the broker, dealer, or 
        such person knew or had reasonable grounds to believe was false 
        or misleading;
            ``(5) for a consideration, received directly or indirectly 
        from a broker or dealer, or other person selling or offering 
        for sale or purchasing or offering to purchase the security, to 
        induce the purchase of any security registered on a national 
        securities exchange or any security-based swap (or security 
        derivative, as the Commission determines by rule, regulation, 
        or order) with respect to such security by the circulation or 
        dissemination of information to the effect that the price of 
        any such security will or is likely to rise or fall because of 
        the market operations of any one or more persons conducted for 
        the purpose of raising or depressing the price of such 
        security; or'';
                    (B) in section 10(b) (15 U.S.C. 78j(b))--
                            (i) by striking ``or any securities-based 
                        swap agreement (as defined in section 206B of 
                        the Gramm-Leach-Bliley Act),''; and
                            (ii) by striking ``Rules promulgated under 
                        subsection (b)'' and all that follows through 
                        ``as they apply to securities'';
                    (C) in section 15(c)(1) (15 U.S.C. 78o(c)(1))--
                            (i) in subparagraph (A) by striking ``, or 
                        any security-based swap agreement (as defined 
                        in section 206B of the Gramm-Leach-Bliley 
                        Act),''; and
                            (ii) in each of subparagraphs (B) and (C), 
                        by striking ``swap agreement (as defined in 
                        section 206B of the Gramm-Leach-Bliley Act)'' 
                        each place that term appears and inserting 
                        ``swap'';
                    (D) in section 16(a)(2)(C) (15 U.S.C. 
                78p(a)(2)(C)), by striking ``swap agreement (as defined 
                in section 206(b) of the Gramm-Leach-Bliley Act)'' and 
                inserting ``swap (or security derivative, as the 
                Commission determines by rule, regulation, or order)'';
                    (E) in section 16(a)(3)(B) (15 U.S.C. 
                78p(a)(3)(B)), by striking ``security-based swap 
                agreement'' and inserting ``swap (or security 
                derivative, as the Commission determines by rule, 
                regulation, or order)'';
                    (F) in section 16(b) (15 U.S.C. 78p(b))--
                            (i) by striking ``(as defined in section 
                        206B of the Gramm-Leach-Bliley Act)'' each 
                        place that term appears and inserting ``; (or 
                        security derivative, as the Commission 
                        determines by rule, regulation, or order)''; 
                        and
                            (ii) by striking ``swap agreement'' each 
                        place that term appears and inserting ``swap 
                        (or security derivative, as the Commission 
                        determines by rule, regulation, or order)'';
                    (G) in section 20(d) (15 U.S.C. 78t(d)), by 
                striking ``or security-based swap agreement (as defined 
                in section 206B of the Gramm-Leach-Bliley Act) with 
                respect to such security'' and inserting ``, security 
                futures product or swap''; and
                    (H) in section 21A(a)(1) (15 U.S.C. 78u-1(a)(1)), 
                by striking ``or security-based swap agreement (as 
                defined in section 206B of the Gramm-Leach-Bliley 
                Act)''.
    (b) Rationalization of Security Futures Oversight.--
            (1) Amendments to the securities exchange act of 1934.--The 
        Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
        amended--
                    (A) in section 3(a) of (15 U.S.C. 78c(a)), by 
                striking paragraph (55) and inserting the following:
            ``(55) The term `security future'--
                    ``(A) means a contract of sale for future delivery 
                of a security or an index of securities, including any 
                interest therein or based on the value thereof, or 
                based on any financial, economic, or commercial 
                occurrence, extent of an occurrence, contingency, or 
                consequence that is related to or based on a security, 
                an interest in a security, an issuer of a security, or 
                group or index of securities, or interests in 
                securities or issuers of securities, or based on the 
                value of any of the foregoing, other than an exempted 
                security under paragraph (12), as in effect on the date 
                of enactment of the Futures Trading Act of 1982 (other 
                than a municipal security, under paragraph (29), as in 
                effect on the date of enactment of the Futures Trading 
                Act of 1982); and
                    ``(B) does not include any security-based swap.'';
                    (B) in section 6 (15 U.S.C. 78f)--
                            (i) by striking subsections (g), (i), and 
                        (k);
                            (ii) by redesignating subsections (h) and 
                        (j) as subsections (g) and (h), respectively; 
                        and
                            (iii) in subsection (g), as so 
                        redesignated--
                                    (I) in paragraph (2)--
                                            (aa) by striking ``(A)''; 
                                        and
                                            (bb) by striking ``and (B) 
                                        meet the criteria specified in 
                                        section 2(a)(1)(D)(i) of the 
                                        Commodity Exchange Act'';
                                    (II) in paragraph (3)(A), by 
                                striking ``security of a narrow-based 
                                security'' and inserting ``of an'';
                                    (III) in paragraph (3)(D), by 
                                striking ``and the Commodity Futures 
                                Trading Commission jointly determine'' 
                                and inserting ``determines'';
                                    (IV) in paragraph (3)(G), by 
                                striking ``the prohibition against dual 
                                trading in section 4j of the Commodity 
                                Exchange Act (7 U.S.C. 6j) and the 
                                rules and regulations thereunder or'';
                                    (V) in paragraph (4)(A), by 
                                striking ``and the Commodity Futures 
                                Trading Commission, by rule, 
                                regulation, or order, may jointly'' and 
                                inserting ``may, by rule, regulation, 
                                or order,'';
                                    (VI) in paragraph (4)(B), by 
                                striking ``and the Commodity Futures 
                                Trading Commission, by order, may 
                                jointly'' and inserting ``may, by 
                                order,'';
                                    (VII) in paragraph (6)--
                                            (aa) by striking ``and the 
                                        Commodity Futures Trading 
                                        Commission'';
                                            (bb) by striking 
                                        ``jointly''; and
                                            (cc) by striking ``and the 
                                        Commodity Exchange Act''; and
                                    (VIII) in paragraph (7)--
                                            (aa) by striking 
                                        subparagraph (A) and inserting 
                                        the following:
                    ``(A) Notwithstanding paragraph (2), until the 
                compliance date, a national securities exchange or 
                national securities association that is registered 
                pursuant to section 15A(a) may trade a security futures 
                product that does not conform with any listing standard 
                promulgated to meet the requirement specified in 
                subparagraph (E) of paragraph (3).''; and
                                            (bb) in subparagraph (B), 
                                        by striking ``and the Commodity 
                                        Futures Trading Commission 
                                        shall jointly'' and inserting 
                                        ``shall'';
                    (C) in section 7 (15 U.S.C. 78g)--
                            (i) in subsection (c)(2)(A)(ii), by 
                        striking ``and the Commodity Futures Trading 
                        Commission shall jointly'' and inserting 
                        ``shall'';
                            (ii) in subsection (c)(2)(A), by striking 
                        ``and the Commodity Futures Trading Commission 
                        have not jointly'' and inserting ``has not''; 
                        and
                            (iii) in subsection (c)(2)(B)--
                                    (I) by striking ``and the Commodity 
                                Futures Trading Commission shall 
                                jointly'' and inserting ``shall''; and
                                    (II) by striking ``and the 
                                Commodity Futures Trading Commission 
                                jointly deem'' and inserting ``deems'';
                    (D) in section 11A (15 U.S.C. 78k-1), by striking 
                subsection (e);
                    (E) in section 12(k) (15 U.S.C. 78l(k))--
                            (i) in paragraph (1), by striking ``If the 
                        actions described in subparagraph (A) or (B) 
                        involve a security futures product, the 
                        Commission shall consult with and consider the 
                        views of the Commodity Futures Trading 
                        Commission.''; and
                            (ii) in paragraph (2)(B), by striking ``If 
                        the actions described in subparagraph (A) 
                        involve a security futures product, the 
                        Commission shall consult with and consider the 
                        views of the Commodity Futures Trading 
                        Commission.'';
                    (F) in section 15 (15 U.S.C. 78o)--
                            (i) in subsection (b), by striking 
                        paragraphs (11) and (12); and
                            (ii) in subsection (c)(3)--
                                    (I) by striking ``(A) No'' and 
                                inserting ``No''; and
                                    (II) by striking subparagraph (B);
                    (G) in section 15A (15 U.S.C. 78o-3), by striking 
                subsections (k), (l), and (m);
                    (H) in section 17(b) (15 U.S.C. 78q(b))--
                            (i) in paragraph (1)--
                                    (I) by striking ``(1)'' and all 
                                that follows through ``All records'' 
                                and inserting ``All records'';
                                    (II) by striking ``of a--'' and all 
                                that follows through ``(A) registered'' 
                                and inserting ``of a registered''; and
                                    (III) by striking ``; or'' and all 
                                that follows through the end of 
                                subparagraph (B) and inserting a 
                                period; and
                            (ii) by striking paragraphs (2) through 
                        (4);
                    (I) in section 17A(b) (15 U.S.C. 78q-1(b))--
                            (i) by striking paragraph (7); and
                            (ii) by redesignating paragraph (8) as 
                        paragraph (7);
                    (J) in section 19 (15 U.S.C. 78s)--
                            (i) in subsection (b)--
                                    (I) by striking paragraphs (7) and 
                                (9); and
                                    (II) by redesignating paragraph (8) 
                                as paragraph (7); and
                            (ii) in subsection (d), by striking 
                        paragraph (3);
                    (K) in section 21 (15 U.S.C. 78u), by striking 
                subsection (i); and
                    (L) in section 28(e) (15 U.S.C. 78bb(e)), by 
                striking paragraph (4).
            (2) Conforming amendments to the securities act of 1933.--
        The Securities Act of 1933 (15 U.S.C. 77 et seq.) is amended--
                    (A) in section 2(a) (15 U.S.C. 77b(a)), by striking 
                paragraph (16) and inserting the following:
            ``(16) The terms `security future' and `security futures 
        product' have the same meanings as in sections 3(a)(55) and 
        3(a)(56), respectively, of the Securities Exchange Act of 
        1934.''; and
                    (B) in section 3(a)(14)(A) (15 U.S.C. 
                77c(a)(14)(A)), by striking ``or exempt from 
                registration under subsection (b)(7) of such section 
                17A''.
            (3) Conforming amendment to the investment company act of 
        1940.--Section 2(a)(52) of the Investment Company Act of 1940 
        (15 U.S.C. 80a-2(a)(52)) is amended to read as follows:
            ``(52) The term `security future' has the same meaning as 
        in section 3(a)(55) of the Securities Exchange Act of 1934.''.
            (4) Conforming amendment to the investment advisers act of 
        1940.--Section 202(a)(27) of the Investment Advisers Act of 
        1940 (15 U.S.C. 80b-2(a)(27)) is amended to read as follows:
            ``(27) The term `security future' has the same meaning as 
        in section 3(a)(55) of the Securities Exchange Act of 1934.''.
            (5) Conforming amendments to the securities investor 
        protection act of 1970.--The Securities Investor Protection Act 
        of 1970 (15 U.S.C. 78aaa et seq.) is amended--
                    (A) in section 3(a)(2)(A) (15 U.S.C. 
                78ccc(a)(2)(A))--
                            (i) in clause (i), by inserting ``and'' 
                        after the semicolon at the end;
                            (ii) in clause (ii), by striking ``; and'' 
                        and inserting a period; and
                            (iii) by striking clause (iii); and
                    (B) in section 16(14) (15 U.S.C. 78lll(14)), by 
                striking ``section 3(a)(55)(A)'' and inserting 
                ``section 3(a)(55)''.
    (c) Clarification of the Status of Event Contracts.--
            (1) Amendments to the securities exchange act of 1934.--
        Section (3)(a)(10) of the Securities Exchange Act of 1934 (15 
        U.S.C. 78c(a)(10) is amended--
                    (A) by striking ``term `security' means any note'' 
                and inserting the following: ``term `security'--
                    ``(A) means--
                            ``(i) any note'';
                    (B) by striking ``or any certificate'' and 
                inserting the following: ``; or
                            ``(ii) any certificate''; and
                    (C) by striking ``any of the foregoing, but shall 
                not'' and inserting the following: ``any security 
                described in clause (i); or
                            ``(iii) any agreement, contract, or 
                        transaction that is associated with a 
                        financial, economic, or commercial occurrence, 
                        extent of an occurrence, contingency, or 
                        consequence that is related to or based on a 
                        security, an interest in a security, an issuer 
                        of a security, or group or index of securities, 
                        or interests in securities or issuers of 
                        securities, or based on the value of any of the 
                        foregoing or any security described in clause 
                        (i) or (ii); and
                    ``(B) does not''.
            (2) Amendments to the securities act of 1933.--Section 
        (2)(a)(1) of the Securities Act of 1933 (15 U.S.C. 77b(a)(1)) 
        is amended--
                    (A) by striking ``means any note'' and inserting 
                the following: ``means--
                    ``(A) any note'';
                    (B) by striking ``, or any certificate'' and 
                inserting the following: ``; or
                    ``(B) any certificate''; and
                    (C) by striking ``any of the foregoing.'' and 
                inserting the following: ``any security described in 
                subparagraph (A); or
                    ``(C) any agreement, contract, or transaction that 
                is associated with a financial, economic, or commercial 
                occurrence, extent of an occurrence, contingency, or 
                consequence that is related to or based on a security, 
                an interest in a security, an issuer of a security, or 
                group or index of securities, or interests in 
                securities or issuers of securities, or based on the 
                value of any of the foregoing or any security described 
                in subparagraph (A) or (B).''.

SEC. 103. REQUIRED CLEARING OF STANDARDIZED DERIVATIVES THROUGH CENTRAL 
              COUNTERPARTIES AND THE USE OF TRADE REPOSITORIES.

    The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended by inserting after section 17B (15 U.S.C. 78q-2) the following 
new section:

``SEC. 17C. USE OF CLEARING AGENCIES AND TRADE REPOSITORIES FOR 
              DERIVATIVES TRANSACTIONS.

    ``(a) Findings.--Congress finds that--
            ``(1) the proliferation of over-the-counter security-based 
        swaps poses unacceptable risks to the financial system;
            ``(2) clearing standardized security-based swaps through 
        well-regulated central counterparties would reduce systemic 
        risk in the financial system;
            ``(3) the markets for standardized security-based swaps 
        suffer from a lack of reliable and accurate transaction 
        information that is available to the public, investors, and 
        regulators; and
            ``(4) weaknesses in the regulation of markets for 
        standardized security-based swaps have detracted from the 
        efficiency and transparency of trading in such markets and 
        hampered the surveillance and oversight of such markets.
    ``(b) Purposes.--The purposes of this section are--
            ``(1) to establish well-regulated markets for standardized 
        security-based swaps to promote efficiency and transparency of 
        trading and enhance the surveillance and oversight of such 
        markets; and
            ``(2) to promote the public interest, the protection of 
        investors, and the maintenance of fair and orderly markets to 
        assure--
                    ``(A) the prompt and accurate clearance and 
                settlement of transactions in standardized security-
                based swaps;
                    ``(B) the prompt and accurate reporting of 
                transactions in security-based swaps to a trade 
                repository or a registered clearing agency;
                    ``(C) the establishment of linked or coordinated 
                facilities for clearance and settlement of transactions 
                in securities, securities options, contracts of sale 
                for future delivery and options thereon, commodity 
                options, and derivatives;
                    ``(D) availability to the public, investors, and 
                regulators of reliable and accurate quotation and 
                transaction information in security-based swaps;
                    ``(E) economically efficient execution of 
                transactions in security-based swaps; and
                    ``(F) fair competition among markets in the trading 
                of security-based swaps.
    ``(c) Use of Derivatives Clearing Agencies.--
            ``(1) In general.--Any person that is a party to a 
        security-based swap (or security derivative, as the Commission 
        determines by rule, regulation, or order) that the Commission 
        determines is `standardized' shall submit such instrument for 
        clearing to a registered clearing agency within the period 
        specified by rule of the Commission.
            ``(2) Definition of `standardized'.--
                    ``(A) In general.--The Commission shall, by rule, 
                define the term `standardized' for purposes of this 
                section.
                    ``(B) Factors.--In defining the term 
                `standardized', the Commission shall--
                            ``(i) be consistent with the public 
                        interest, the protection of investors, the 
                        safeguarding of securities and funds, the 
                        maintenance of fair competition among market 
                        participants and among clearing agencies, and 
                        the purposes of this section;
                            ``(ii)(I) consult with, and consider the 
                        views of, the Commodity Futures Trading 
                        Commission and the Board of Governors of the 
                        Federal Reserve System; and
                            ``(II) seek to maintain comparability, to 
                        the maximum extent practicable, with the 
                        definition of the Commodity Futures Trading 
                        Commission of the term `standardized' for 
                        purposes of section 4r of the Commodity 
                        Exchange Act; and
                            ``(iii) to the extent applicable to a 
                        particular security-based swap or security 
                        derivative or class of security-based swaps or 
                        security derivatives, consider--
                                    ``(I) whether a clearing agency is 
                                prepared to clear the security-based 
                                swap or security derivative, and such 
                                clearing agency has in place effective 
                                risk management systems;
                                    ``(II) the availability or ability 
                                to facilitate standard documentation of 
                                terms of the security-based swap or 
                                security derivative;
                                    ``(III) the liquidity of the 
                                security-based swap or security 
                                derivative and its underlying security, 
                                security of a reference entity, or 
                                group or index thereof;
                                    ``(IV) the ability to value the 
                                security-based swap or security 
                                derivative, underlying security, or 
                                security of a reference entity, or 
                                group or index thereof consistently 
                                with an accepted pricing methodology, 
                                including the availability of intraday 
                                prices; and
                                    ``(V) such other factors as are 
                                consistent with the purposes of this 
                                section.
            ``(3) Exemption authority.--
                    ``(A) In general.--The Commission by rule or order, 
                as the Commission deems necessary or appropriate in the 
                public interest or for the protection of investors, may 
                conditionally or unconditionally exempt from the 
                requirements of this subsection and the rules issued 
                under this subsection, any person, transaction, or 
                security.
                    ``(B) Prior consultation with the commodity futures 
                trading commission and the board of governors of the 
                federal reserve system.--
                            ``(i) Consultation.--Before acting by rule 
                        or order to exempt any person, transaction, or 
                        security from the requirements of this 
                        subsection or the rules issued under this 
                        subsection, the Commission shall consult with, 
                        and consider the views of, the Commodity 
                        Futures Trading Commission and the Board of 
                        Governors of the Federal Reserve System 
                        concerning whether such exemption is necessary 
                        and appropriate for the reduction of risk and 
                        in the public interest.
                            ``(ii) Prohibition on issuance.--Not later 
                        than 45 days prior to issuing any exemption 
                        under this subparagraph, the Commission shall 
                        send a notice to the Commodity Futures Trading 
                        Commission and the Board of Governors 
                        describing such exemption. If either the 
                        Commodity Futures Trading Commission or the 
                        Board of Governors issues a finding under 
                        clause (i) that such an exemption does not meet 
                        the standard described in clause (i), the 
                        Commission may not issue such exemption.
                            ``(iii) Deadline.--Any finding by the 
                        Commodity Futures Trading Commission or the 
                        Board of Governors of the Federal Reserve 
                        System shall be made and provided in writing to 
                        the Commission not later than 30 days after the 
                        date of receipt of notice of a proposed 
                        exemption by the Commission.
                            ``(iv) Nondelegation.--Action by the 
                        Commodity Futures Trading Commission or the 
                        Board of Governors under this subparagraph may 
                        not be delegated.
    ``(d) Trade Repositories.--
            ``(1) Use of trade repositories.--
                    ``(A) In general.--Any person that enters into or 
                effects a transaction in a security-based swap (or 
                security derivative, as the Commission determines by 
                rule, regulation, or order) shall submit such 
                transaction for clearing to a registered clearing 
                agency or report such transaction to a trade repository 
                registered in accordance with this subsection within 
                the period specified by rule of the Commission.
                    ``(B) Required reporting authorized.--The 
                Commission may, by rule, require any person to report 
                to any registered clearing agency and registered trade 
                repository such transaction information as the 
                Commission deems necessary or appropriate, to permit 
                such clearing agency or trade repository to meet the 
                purposes of this section.
                    ``(C) Exemption authority.--The Commission by rule, 
                regulation, or order, as the Commission deems 
                consistent with the public interest or the protection 
                of investors, may conditionally or unconditionally 
                exempt from the requirements of this paragraph and the 
                rules issued under this paragraph any person, 
                transaction, or security that enters into or effects a 
                transaction in a security or class of securities.
            ``(2) Registration.--A trade repository may register for 
        purposes of this subsection by filing with the Commission an 
        application in such form as the Commission, by rule, may 
        prescribe, containing the rules of the trade repository and 
        such other information and documentation as the Commission, by 
        rule, may prescribe as necessary or appropriate in the public 
        interest, for the protection of investors, or for the prompt 
        and accurate collection, calculation, processing, and 
        preparation of information regarding security-based swaps or 
        security derivatives.
            ``(3) Commission procedures for applications.--
                    ``(A) Notice.--On the filing of an application for 
                registration pursuant to paragraph (2), the Commission 
                shall publish notice of the filing and afford 
                interested persons an opportunity to submit written 
                data, views, and arguments concerning such application.
                    ``(B) Actions.--Not later than 90 days after the 
                date of publication of a notice under subparagraph (A) 
                (or within such longer period as to which the applicant 
                consents), the Commission shall--
                            ``(i) by order, grant such registration; or
                            ``(ii) institute proceedings to determine 
                        whether registration should be denied.
                    ``(C) Procedure for denials.--
                            ``(i) In general.--Proceedings instituted 
                        under subparagraph (B)(ii) shall--
                                    ``(I) include notice of the grounds 
                                for denial under consideration and 
                                provide an opportunity for a hearing; 
                                and
                                    ``(II) be concluded not later than 
                                180 days after the date of publication 
                                of notice of the filing of the 
                                application for registration under 
                                subparagraph (A).
                            ``(ii) Actions.--At the conclusion of such 
                        proceedings, the Commission, by order, shall 
                        grant or deny the subject registration.
                            ``(iii) Extensions.--The Commission may 
                        extend the time for conclusion of the 
                        proceedings under subparagraph (C) for--
                                    ``(I) not longer than an additional 
                                60 days, if the Commission finds good 
                                cause for such extension and publishes 
                                its reasons for so finding; or
                                    ``(II) for such longer period as to 
                                which the applicant consents.
                    ``(D) Standards for granting registration.--The 
                Commission shall grant the registration of a trade 
                repository for purposes of this section if the 
                Commission finds that the trade repository is so 
                organized, and has the capacity to be able--
                            ``(i) to assure the prompt, accurate, and 
                        reliable performance of its functions as a 
                        trade repository;
                            ``(ii) to comply with the provisions of 
                        this title (including rules and regulations 
                        issued under this title); and
                            ``(iii) to carry out the functions of a 
                        trade repository in a manner consistent with 
                        the purposes of this section.
                    ``(E) Standards for denial.--The Commission shall 
                deny the registration of a trade repository if the 
                Commission does not make the findings described in 
                subparagraph (D).
            ``(4) Withdrawal of registration.--
                    ``(A) In general.--A registered trade repository 
                may, upon such terms and conditions as the Commission 
                deems necessary or appropriate in the public interest 
                or for the protection of investors, withdraw from 
                registration under this section by filing a written 
                notice of withdrawal with the Commission.
                    ``(B) Cancellation.--If the Commission finds that 
                any trade repository is no longer in existence or has 
                ceased to do business in the capacity specified in its 
                application for registration under this section, the 
                Commission, by order, shall cancel the registration.
            ``(5) Access to trade repository services.--
                    ``(A) Notice of prohibition or limitation.--
                            ``(i) In general.--If any registered trade 
                        repository prohibits or limits any person in 
                        respect of access to services offered, directly 
                        or indirectly, by the trade repository, the 
                        registered trade repository shall promptly file 
                        notice of the prohibition with the Commission, 
                        in such form and containing such information as 
                        the Commission, by rule, may prescribe as 
                        necessary or appropriate in the public interest 
                        or for the protection of investors.
                            ``(ii) Review by commission.--Any 
                        prohibition or limitation on access to services 
                        with respect to which a registered trade 
                        repository is required by this subparagraph to 
                        file notice shall be subject to review by the 
                        Commission, on its own motion or upon 
                        application by any person aggrieved thereby, 
                        filed not later than 30 days after such notice 
                        has been filed with the Commission and received 
                        by such aggrieved person, or within such longer 
                        period as the Commission may determine.
                            ``(iii) Stays.--Application to the 
                        Commission for review, or the institution of 
                        review by the Commission on its own motion, 
                        shall not operate as a stay of a prohibition or 
                        limitation described in clause (i), unless the 
                        Commission otherwise orders, summarily or after 
                        notice and opportunity for hearing on the 
                        question of a stay (which hearing may consist 
                        solely of the submission of affidavits or 
                        presentation of oral arguments).
                            ``(iv) Expedited procedure.--The Commission 
                        shall establish for appropriate cases an 
                        expedited procedure for consideration and 
                        determination of the question of a stay.
                    ``(B) Standards of review.--In any proceeding to 
                review the prohibition or limitation of any person in 
                respect of access to services offered by a registered 
                trade repository--
                            ``(i) if the Commission finds after notice 
                        and opportunity for hearing, that such 
                        prohibition or limitation is consistent with 
                        the provisions of this title and the rules and 
                        regulations thereunder, and that such person 
                        has not been discriminated against unfairly, 
                        the Commission, by order, shall dismiss the 
                        proceeding; and
                            ``(ii) if the Commission does not make any 
                        such finding, or if it finds that such 
                        prohibition or limitation imposes any burden on 
                        competition that is not necessary or 
                        appropriate in furtherance of the purposes of 
                        this title, the Commission, by order, shall set 
                        aside the prohibition or limitation and require 
                        the registered trade repository to permit such 
                        person access to the services offered by the 
                        registered trade repository to which the 
                        prohibition or limitation applied.
            ``(6) Administrative proceeding authority.--If the 
        Commission finds, on the record after notice and opportunity 
        for hearing, that such action is necessary or appropriate in 
        the public interest, for the protection of investors, or 
        otherwise in furtherance of the purposes of this title and that 
        a registered trade repository has violated or is unable to 
        comply with any provision of this title or the rules or 
        regulations thereunder, the Commission, by order, may--
                    ``(A) censure or place limitations upon the 
                activities, functions, or operations of any registered 
                trade repository; or
                    ``(B) suspend for a period of not longer than 12 
                months or revoke the registration of any such trade 
                repository.
            ``(7) Rulemaking authority.--No registered trade repository 
        shall, directly or indirectly, engage in any activity as a 
        trade repository in contravention of such rules and regulations 
        as the Commission may prescribe as appropriate in the public 
        interest, for the protection of investors, or otherwise in 
        furtherance of the purposes of this title, including to assure 
        that all persons may obtain on terms that are fair and 
        reasonable and not unreasonably discriminatory such transaction 
        and position information for security-based swaps and security 
        derivatives as is disseminated by any clearing agency or trade 
        repository.
            ``(8) Consultation.--
                    ``(A) In general.--Prior to adopting any rules 
                applicable to trade repositories pursuant to section 
                17(a), the Commission shall consult with, and shall 
                consider the views of, the Commodity Futures Trading 
                Commission.
                    ``(B) Comparability.--The Commission and the 
                Commodity Futures Trading Commission shall seek to 
                maintain comparability, to the maximum extent 
                practicable, of their respective recordkeeping and 
                reporting requirements for trade repositories.
    ``(e) Timing.--The Commission may, by rule, specify the date by 
which persons are required--
            ``(1) to submit transactions in standardized security-based 
        swaps and security derivatives for clearing to a clearing 
        agency pursuant to subsection (c); and
            ``(2) to submit transactions in security-based swaps and 
        security derivatives for clearing to a clearing agency or 
        report transactions in such instruments to a registered trade 
        repository pursuant to subsection (d).
    ``(f) Collection, Consolidation, and Dissemination of Information 
on Transactions and Positions in Security-Based Swaps and Security 
Derivatives.--
            ``(1) Commission action required.--The Commission shall, 
        consistent with the public interest, the protection of 
        investors, the maintenance of fair and orderly markets, and the 
        purposes of this section, use the authority of the Commission 
        under this title to facilitate--
                    ``(A) the collection, consolidation, and 
                dissemination of information on transactions and 
                positions in security-based swaps and security 
                derivatives; and
                    ``(B) the establishment of coordinated facilities 
                for the consolidation of information on transactions 
                and positions in security-based swaps and security 
                derivatives.
            ``(2) Actions required of registered entities.--The 
        Commission, by rule, regulation, or order is authorized to 
        require each clearing agency that clears or proposes to clear 
        transactions in security-based swaps and security derivatives, 
        and each trade repository registered or applying to become 
        registered under this section, in such form and frequency as 
        the Commission shall prescribe as necessary or appropriate in 
        the public interest, for the protection of investors, or 
        otherwise in furtherance of the purposes of this title--
                    ``(A) to disseminate certain transaction or 
                position information in security-based swaps and 
                security derivatives; and
                    ``(B) to assure the prompt, accurate, reliable, and 
                fair collection, processing, distribution, and 
                publication of information with respect to transactions 
                and positions, as appropriate, cleared by such clearing 
                agency or reported to such registered trade 
                repository.''.

SEC. 104. PRUDENTIAL SUPERVISION AND REGULATION OF SIGNIFICANT 
              SECURITY-BASED DERIVATIVES MARKET PARTICIPANTS AND 
              INCENTIVES FOR TRADING ON REGULATED EXCHANGES.

    (a) Regulation of Significant Security-Based Derivatives Market 
Participants.--The Securities Exchange Act of 1934 (15 U.S.C. 78a et 
seq.) is amended by inserting after section 15E (15 U.S.C. 78o-7) the 
following:

``SEC. 15F. REGULATION OF SIGNIFICANT SECURITY-BASED DERIVATIVES MARKET 
              PARTICIPANTS.

    ``(a) Registration by Significant Security-Based Derivatives Market 
Participants.--It shall be unlawful for any significant security-based 
derivatives market participant to make use of the mails or any means or 
instrumentality of interstate commerce to effect any transactions in, 
or to induce or attempt to induce the purchase or sale of, any 
security-based swap (or security derivative, as the Commission 
determines by rule, regulation, or order), unless such significant 
security-based derivatives market participant has registered in 
accordance with subsection (b).
    ``(b) Manner of Registration of Significant Security-Based 
Derivatives Market Participants.--
            ``(1) In general.--A significant security-based derivatives 
        market participant may register for purposes of this section by 
        filing with the Commission an application for registration, in 
        such form and containing such information and documentation 
        concerning such significant security-based derivatives market 
        participant and any persons associated with such significant 
        security-based derivatives market participant as the 
        Commission, by rule, regulation, or order may prescribe as 
        necessary or appropriate in the public interest or for the 
        protection of investors.
            ``(2) Commission action.--
                    ``(A) Timing.--Not later than 45 days after the 
                date of filing of an application under paragraph (1) 
                (or within such longer period as to which the applicant 
                consents), the Commission shall--
                            ``(i) by order, grant registration; or
                            ``(ii) institute proceedings to determine 
                        whether registration should be denied.
                    ``(B) Commission proceedings.--Proceedings 
                described in subparagraph (A)(ii) shall--
                            ``(i) include notice of the grounds for 
                        denial under consideration and opportunity for 
                        hearing; and
                            ``(ii) be concluded within 120 days of the 
                        date of the filing of the application for 
                        registration.
                    ``(C) Grant or denial.--At the conclusion of 
                proceedings under this paragraph, the Commission, by 
                order, shall grant or deny any application for 
                registration.
                    ``(D) Extension authorized.--The Commission may 
                extend the time for the conclusion of proceedings under 
                this paragraph for not longer than an additional 90 
                days if the Commission finds good cause for such 
                extension and publishes its reasons for so finding, or 
                for such longer period as to which the applicant 
                consents.
                    ``(E) Conditions of grant or denial of 
                applications.--The Commission shall--
                            ``(i) grant an application for registration 
                        of a significant security-based derivatives 
                        market participant, if the Commission finds 
                        that the requirements of this section are 
                        satisfied; and
                            ``(ii) deny such registration, if the 
                        Commission does not make a finding described in 
                        clause (i), or finds that if the applicant were 
                        so registered, its registration would be 
                        subject to suspension or revocation under 
                        subsection (e).
            ``(3) Withdrawal authorized.--Any person that has filed an 
        application pursuant to paragraph (1) may, upon such terms and 
        conditions as the Commission deems necessary or appropriate in 
        the public interest, for the protection of investors, or 
        otherwise in furtherance of the purposes of this title, 
        withdraw such application by filing a written withdrawal with 
        the Commission.
    ``(c) Business Conduct Requirements.--
            ``(1) Prohibition.--It shall be unlawful for any 
        significant security-based derivatives market participant and 
        such other persons as the Commission may determine, by rule, 
        regulation, or order, to make use of the mails or any means or 
        instrumentality of interstate commerce to effect any 
        transaction in, or to induce or attempt to induce the purchase 
        or sale of, any security-based swap (or security derivative, as 
        the Commission determines by rule, regulation, or order), 
        unless such person complies with such business conduct 
        requirements as the Commission and the Commodity Futures 
        Trading Commission, in consultation with the appropriate 
        regulatory authorities, may jointly prescribe, by rule, 
        regulation, or order, as necessary or appropriate in the public 
        interest, for the protection of investors, and otherwise in 
        furtherance of the purposes of this title.
            ``(2) Content.--Business conduct requirements under 
        paragraph (1) shall--
                    ``(A) establish the standard of care required for a 
                significant security-based derivatives market 
                participant and such other persons to verify that any 
                counterparty meets the eligibility standards for an 
                eligible contract participant or qualified 
                institutional buyer;
                    ``(B) require disclosure by the significant 
                security-based derivatives market participant and such 
                other persons to any counterparty to the transaction 
                of--
                            ``(i) material product-specific information 
                        about the risks and characteristics of the 
                        security-based swap (or security derivative, as 
                        the Commission determines by rule, regulation, 
                        or order);
                            ``(ii) the source and amount of any fees or 
                        other material remuneration that the 
                        significant security-based derivatives market 
                        participant and such other persons would 
                        directly or indirectly expect to receive in 
                        connection with the security-based swap (or 
                        security derivative, as the Commission 
                        determines by rule, regulation, or order); and
                            ``(iii) any other material incentives or 
                        conflicts of interest that the significant 
                        security-based derivatives market participant 
                        and such other persons may have in connection 
                        with the security-based swap (or security 
                        derivative, as the Commission determines by 
                        rule, regulation, or order);
                    ``(C) establish a minimum standard of conduct for a 
                significant security-based derivatives market 
                participant and such other persons with respect to any 
                counterparty, other than a qualified institutional 
                buyer, for--
                            ``(i) providing disclosure of the general 
                        risks and characteristics of any security-based 
                        swap (or security derivative, as the Commission 
                        determines by rule, regulation, or order);
                            ``(ii) communicating in a fair and balanced 
                        manner based on principles of fair dealing and 
                        good faith;
                            ``(iii) assessing the appropriateness of 
                        any security-based swap (or security 
                        derivative, as the Commission determines by 
                        rule, regulation, or order) for the 
                        counterparty, except that, if the counterparty 
                        is an eligible contract participant, the 
                        significant security-based derivatives market 
                        participant may rely on a representation 
                        described in clause (iv)(VI) that the 
                        transaction is appropriate for such 
                        counterparty; and
                            ``(iv) with respect to a counterparty that 
                        is an eligible contract participant within the 
                        meaning of subclause (I) or (II) of section 
                        3(a)(67)(A)(vii), having a reasonable basis to 
                        believe that the counterparty has an 
                        independent representative that--
                                    ``(I) has sufficient knowledge to 
                                evaluate the transaction and risks;
                                    ``(II) is not subject to a 
                                statutory disqualification;
                                    ``(III) is independent of the 
                                significant security-based derivatives 
                                market participant;
                                    ``(IV) undertakes a duty to act in 
                                the best interests of the counterparty 
                                it represents;
                                    ``(V) makes appropriate 
                                disclosures; and
                                    ``(VI) will provide written 
                                representations to the eligible 
                                contract participant regarding fair 
                                pricing and the appropriateness of the 
                                transaction;
                    ``(D) require the availability of information about 
                any security or the issuer of any security referenced 
                in a security-based swap (or security derivative, as 
                the Commission determines by rule, regulation, or 
                order), or upon which such security-based swap (or 
                security derivative, as the Commission determines by 
                rule, regulation, or order) is based; and
                    ``(E) establish such other standards and 
                requirements as the Commission, acting jointly with the 
                Commodity Futures Trading Commission and in 
                consultation with the appropriate regulatory 
                authorities, may determine are necessary or appropriate 
                in the public interest, for the protection of 
                investors, or otherwise in furtherance of the purposes 
                of this title.
    ``(d) Statutory Disqualification.--Except to the extent otherwise 
specifically provided by rule, regulation, or order of the Commission, 
it shall be unlawful for a significant derivatives market participant 
to permit any associated person of such significant derivatives market 
participant who is subject to a statutory disqualification to effect or 
be involved in effecting transactions in security-based swaps (or 
security derivatives, as the Commission determines by rule, regulation, 
or order) on behalf of such significant derivatives market participant, 
if such significant derivatives market participant knew, or in the 
exercise of reasonable care should have known, of such statutory 
disqualification.
    ``(e) Administrative Proceeding Authority.--
            ``(1) In general.--The Commission, by order, shall censure, 
        place limitations on the activities, functions, or operations 
        of, or reject the filing of any significant security-based 
        derivatives market participant that has registered with the 
        Commission pursuant to subsection (b) if it finds, on the 
        record after notice and opportunity for hearing, that such 
        action is in the public interest and that such significant 
        security-based derivatives market participant, or any person 
        associated with such significant security-based derivatives 
        market participant effecting or involved in effecting 
        transactions in security-based swaps (or security derivatives, 
        as the Commission determines by rule, regulation, or order) on 
        behalf of such significant security-based derivatives market 
        participant, whether prior or subsequent to becoming so 
        associated--
                    ``(A) has committed or omitted any act, or is 
                subject to an order or finding, enumerated in 
                subparagraph (A), (D), or (E) of section 15(b)(4);
                    ``(B) has been convicted of any offense specified 
                in subparagraph (B) of section 15(b)(4) during the 10-
                year period preceding the date of commencement of the 
                proceedings under this paragraph;
                    ``(C) is enjoined from any action, conduct, or 
                practice specified in section 15(b)(4)(C);
                    ``(D) is subject to an order or a final order 
                specified in subparagraph (F) or (H), respectively, of 
                section 15(b)(4); or
                    ``(E) has been found by a foreign financial 
                regulatory authority to have committed or omitted any 
                act, or violated any foreign statute or regulation, 
                enumerated in section 15(b)(4)(G).
            ``(2) Associated persons.--With respect to any person who 
        is associated, who is seeking to become associated, or at the 
        time of the alleged misconduct, who was associated or was 
        seeking to become associated, with a significant security-based 
        derivatives market participant for the purpose of effecting or 
        being involved in effecting any security-based swaps (or 
        security derivatives, as the Commission determines by rule, 
        regulation, or order) on behalf of such significant security-
        based derivatives market participant, the Commission, by order, 
        shall censure, place limitations on the activities or functions 
        of such person, or suspend for a period of not longer than 12 
        months, or bar such person from being associated with a 
        significant security-based derivatives market participant, if 
        the Commission finds, on the record after notice and 
        opportunity for a hearing, that such action is in the public 
        interest, and that such person--
                    ``(A) has committed or omitted any act, or is 
                subject to an order or finding, enumerated in 
                subparagraph (A), (D), or (E) of section 15(b)(4);
                    ``(B) has been convicted of any offense specified 
                in section 15(b)(4)(B) during the 10-year period 
                preceding the date of commencement of the proceedings 
                under this paragraph;
                    ``(C) is enjoined from any action, conduct, or 
                practice specified in section 15(b)(4)(C);
                    ``(D) is subject to an order or a final order 
                specified in subparagraph (F) or (H), respectively, of 
                section 15(b)(4); or
                    ``(E) has been found by a foreign financial 
                regulatory authority to have committed or omitted any 
                act, or violated any foreign statute or regulation, 
                enumerated in section 15(b)(4)(G).
            ``(3) Additional prohibitions.--It shall be unlawful--
                    ``(A) for any person as to whom an order under 
                paragraph (2) is in effect, without the consent of the 
                Commission, willfully to become, or to be, associated 
                with a significant security-based derivatives market 
                participant in contravention of such order; or
                    ``(B) for any significant security-based 
                derivatives market participant to permit such a person, 
                without the consent of the Commission, to become or 
                remain, a person associated with the significant 
                security-based derivatives market participant in 
                contravention of an order under paragraph (2), if such 
                significant security-based derivatives market 
                participant knew, or in the exercise of reasonable care 
                should have known, of the order.
    ``(f) Capital and Margin Requirements.--
            ``(1) In general.--It shall be unlawful for any person to 
        conduct business as a significant security-based derivatives 
        market participant, unless such person meets at all times such 
        minimum capital and margin requirements as the appropriate 
        regulatory authorities shall jointly prescribe, by rule or 
        regulation, as necessary or appropriate in the public interest 
        or for the protection of investors and consistent with the 
        purposes of this title to provide safeguards with respect to 
        the financial responsibility and related practices of the 
        significant security-based derivatives market participant.
            ``(2) Capital considerations.--In setting capital 
        requirements for significant security-based derivatives market 
        participants, the appropriate regulatory authorities shall 
        consider, among other things--
                    ``(A) the liquidity of each security-based swap (or 
                security derivative, as the Commission determines by 
                rule, regulation, or order), including whether such 
                instrument is traded on a liquid market, and whether it 
                is centrally cleared; and
                    ``(B) whether the security-based swap (or security 
                derivative, as the Commission determines by rule, 
                regulation, or order) is used to offset or hedge 
                another instrument or asset owned by such significant 
                security-based derivative market participant.
            ``(3) Margin requirements.--The appropriate regulatory 
        authorities shall jointly prescribe margin requirements, which 
        may permit the use of non-cash collateral, that apply to 
        security-based swaps (or security derivatives, as the 
        Commission determines by rule, regulation, or order) entered 
        into by a significant security-based derivatives market 
        participant, as the appropriate regulatory authorities jointly 
        deem necessary or appropriate for the purpose of, among other 
        things--
                    ``(A) preserving the financial integrity of markets 
                trading security-based swaps (or security derivatives); 
                and
                    ``(B) preventing systemic risk.
            ``(4) Commission rules.--Nothing in this section prevents 
        the Commission from prescribing capital and margin requirements 
        that are higher or more restrictive than the joint rules 
        adopted under this subsection for significant security-based 
        derivatives market participants for which it is the appropriate 
        regulatory authority.
    ``(g) Appropriate Regulatory Authority Defined.--For purposes of 
this section, the term `appropriate regulatory authority' means--
            ``(1) the appropriate Federal banking agency (as defined in 
        section 3 of the Federal Deposit Insurance Act (12 U.S.C. 
        1813)) with respect to a significant security-based derivatives 
        market participant that is an insured depository institution 
        (as defined in section 3 of the Federal Deposit Insurance Act 
        (12 U.S.C. 1813)), other than an affiliate of an insured 
        depository institution;
            ``(2) the Federal Housing Finance Agency, with respect to a 
        significant security-based derivatives market participant that 
        is a regulated entity (as defined in section 1301 of the 
        Federal Housing Enterprises Financial Safety and Soundness Act 
        of 1992 (12 U.S.C. 4502));
            ``(3) the Commodity Futures Trading Commission, with 
        respect to a significant security-based derivatives market 
        participant that is--
                    ``(A) a futures commission merchant or an 
                introducing broker (as defined in paragraphs (20) and 
                (23) of section 1a of the Commodity Exchange Act, 
                respectively), other than a broker or dealer registered 
                pursuant to section 15(b) of this title (other than 
                paragraph (11) thereof) or an affiliate of an insured 
                depository institution; or
                    ``(B) a commodity pool operator or commodity 
                trading advisor (as defined in paragraphs (5) and (6) 
                of section 1a of the Commodity Exchange Act, 
                respectively), other than an affiliate of an insured 
                depository institution; and
            ``(4) the Commission, with respect to any other significant 
        security-based derivatives market participant for which there 
        is not another appropriate regulatory authority otherwise 
        specified in this subsection.
    ``(h) Enforcement Authority.--Each appropriate regulatory authority 
shall have sole authority to enforce compliance with the rules adopted 
under subsection (f) in the case of each significant security-based 
derivatives market participant for which it is the appropriate 
regulatory authority, as defined in subsection (g).''.
    (b) Exemption From Broker or Dealer Registration.--Section 15(b) of 
the Securities Exchange Act of 1934 (15 U.S.C. 78o(b)) is amended by 
adding at the end the following:
            ``(13) Exemption for significant security-based derivatives 
        market participants.--A person shall be exempt from the 
        registration requirements of this section, to the extent that 
        such person engages in transactions in security-based swaps, if 
        such person would otherwise be required to register under this 
        section only because such person effects transactions in 
        security-based swaps with eligible contract participants and is 
        a significant security-based derivatives market participant 
        that has registered in accordance with section 15F(b).''.

SEC. 105. RECORDKEEPING AND REPORTING REQUIREMENTS FOR DERIVATIVES 
              MARKET PARTICIPANTS.

    (a) Recordkeeping and Examination Requirements for Security-Based 
Derivative Market Participants.--Section 17 of the Securities Exchange 
Act of 1934 (15 U.S.C. 78q) is amended by adding at the end the 
following:
    ``(l) Recordkeeping by Market Participants in Security-Based Swaps 
or Security Derivatives; Examinations.--
            ``(1) Recordkeeping.--
                    ``(A) In general.--Effective not later than 180 
                days after the date of enactment of this subsection, 
                the Commission shall, by rule, regulation, or order, 
                require each significant security-based derivatives 
                market participant, and such other persons as the 
                Commission, by rule, regulation, or order, determines, 
                to create, keep current, and maintain for prescribed 
                periods such records, furnish such copies thereof (and 
                make and disseminate such reports) relating to 
                security-based swaps (or security derivatives, as the 
                Commission determines by rule, regulation, or order) to 
                the Commission, as necessary or appropriate in the 
                public interest, for the protection of investors, or 
                otherwise in furtherance of the purposes of this title.
                    ``(B) Minimum requirements.--At a minimum, the 
                actions of the Commission under subparagraph (A) shall 
                require, as applicable, the creation and maintenance of 
                client information records, agreements, client ledger 
                information, trade blotters, memoranda of agreements to 
                enter into confirmations, position records, and 
                communications relating to transactions in security-
                based swaps (or security derivatives, as the Commission 
                determines by rule, regulation, or order) and the 
                reporting of transactions and position data.
            ``(2) Examinations.--All records of significant security-
        based derivatives market participants and such other persons 
        described in paragraph (1) are subject at any time, or from 
        time to time, to such reasonable periodic, special, or other 
        examinations by representatives of the Commission, as the 
        Commission deems necessary or appropriate in the public 
        interest, for the protection of investors, or otherwise in 
        furtherance of the purposes of this title.''.
    (b) Reporting by Significant Security-Based Derivatives Market 
Participants.--Section 13 of the Securities Exchange Act of 1934 (15 
U.S.C. 78m) is amended by adding at the end the following new 
subsection:
    ``(m) Reporting by Significant Security-Based Derivatives Market 
Participants.--
            ``(1) In general.--For the purpose of monitoring the impact 
        of transactions in security-based swaps and, as appropriate, 
        security derivatives, and for the purpose of otherwise 
        assisting the Commission in the enforcement of this title, any 
        significant security-based derivatives market participant that 
        purchases or sells security-based swaps (or security 
        derivatives, as the Commission determines by rule, regulation, 
        or order) shall report such information as the Commission may, 
        by rule, regulation, or order, prescribe as necessary or 
        appropriate in the public interest, for the protection of 
        investors, or otherwise in furtherance of the purposes of this 
        title.
            ``(2) Considerations.--In exercising its authority under 
        this subsection, the Commission shall take into account--
                    ``(A) existing reporting systems;
                    ``(B) the costs associated with reporting such 
                information; and
                    ``(C) the relationship between the United States 
                and international securities and derivatives markets.
            ``(3) Limitation on disclosure.--
                    ``(A) In general.--Notwithstanding any other 
                provision of law, the Commission may not be compelled 
                to disclose any information required by Commission 
                rule, regulation, or order to be reported to the 
                Commission under this subsection.
                    ``(B) Exception.--Nothing in this subsection 
                shall--
                            ``(i) authorize the Commission to withhold 
                        information from Congress; or
                            ``(ii) prevent the Commission from 
                        complying with--
                                    ``(I) a request for information 
                                from any other Federal department or 
                                agency requesting information for 
                                purposes within the scope of its 
                                jurisdiction; or
                                    ``(II) an order of a court of the 
                                United States in an action brought by 
                                the United States or the Commission.
                    ``(C) Treatment for title 5 purposes.--For purposes 
                of section 552 of title 5, United States Code, this 
                subsection shall be considered a statute described in 
                subsection (b)(3)(B) of such section 552.''.
    (c) Beneficial Ownership Reporting.--Section 13 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78m) is amended--
            (1) in subsection (d)(1), by inserting after ``Alaska 
        Native Claims Settlement Act,'' the following: ``or otherwise 
        becomes or is deemed to become a beneficial owner of any of the 
        foregoing, upon the purchase or sale of a security-based swap 
        or security derivative that the Commission may define, by rule, 
        and'';
            (2) in subsection (g)(1), by inserting after ``subsection 
        (d)(1) of this section'' the following: ``or otherwise becomes 
        or is deemed to become a beneficial owner of any security of a 
        class described in subsection (d)(1) upon the purchase or sale 
        of a security-based swap or security derivative that the 
        Commission may define, by rule''; and
            (3) in subsection (f)(1), by inserting after ``section 
        (13)(d)(1) of this title'' the following: ``, or otherwise 
        becomes or is deemed to become a beneficial owner of any 
        security of a class described in subsection (d)(1) upon the 
        purchase or sale of a security-based swap or security 
        derivative that the Commission may define, by rule,''.
    (d) Institutional Investment Manager Reporting.--Section 13 of the 
Securities Exchange Act of 1934 (15 U.S.C. 78m) is amended--
            (1) in subsection (f)(1), by inserting before ``shall file 
        reports'' the following: ``or security-based swaps or security 
        derivatives that the Commission may define by rule, having such 
        values as the Commission may determine, by rule''; and
            (2) in subsection (f)(3), by inserting before ``updated 
        as'' the following: ``and security-based swaps or security 
        derivatives that the Commission may define, by rule''.
    (e) Reporting by Corporate Insiders.--Section 16(f) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78p(f)) is amended by 
inserting ``or security-based swaps'' after ``security futures 
products''.
    (f) Recordkeeping by Trade Repositories.--Section 17(a)(1) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78q(a)(1)) is amended by 
inserting ``registered trade repository,'' after ``registered 
securities information processor,''.

SEC. 106. PROHIBITION OF MARKET MANIPULATION, FRAUD, AND OTHER MARKET 
              ABUSES.

    (a) Rulemaking Authority To Prevent Fraud, Manipulation, and 
Deceptive Conduct in Security-Based Swaps and Security Derivatives.--
Section 9 of the Securities Exchange Act of 1934 (15 U.S.C. 78i), as 
amended by this Act, is amended by adding at the end the following:
    ``(j) Deceptive Conduct in Security-Based Swaps and Security 
Derivatives.--
            ``(1) In general.--It shall be unlawful for any person, 
        directly or indirectly, by the use of any means or 
        instrumentality of interstate commerce or of the mails, or of 
        any facility of any national securities exchange, to effect any 
        transaction in, or to induce or attempt to induce the purchase 
        or sale of, any security-based swap or security derivative, in 
        connection with which such person engages in any fraudulent, 
        deceptive, or manipulative act or practice, makes any 
        fictitious quotation, or engages in any transaction, practice, 
        or course of business which operates as a fraud or deceit upon 
        any person.
            ``(2) Rulemaking required.--The Commission shall, for 
        purposes of this subsection, by rule, regulation, or order, 
        define and prescribe means reasonably designed to prevent 
        transactions, acts, practices, and courses of business that are 
        fraudulent, deceptive, or manipulative, and fictitious 
        quotations.
            ``(3) Consultation.--In adopting rules under this 
        subsection, the Commission shall consult with the Commodity 
        Futures Trading Commission and seek to maintain comparability 
        of such rules with similar rules of the Commodity Futures 
        Trading Commission.''.
    (b) Additions of Security-Based Swaps to Certain Antimanipulation 
Provisions.--Section 9(b) of the Securities Exchange Act of 1934 (15 
U.S.C. 78i(b)) is amended by striking paragraphs (1) through (3) and 
inserting the following:
            ``(1) any transaction in connection with any security 
        whereby any party to such transaction acquires--
                    ``(A) any put, call, straddle, or other option or 
                privilege of buying the security from or selling the 
                security to another without being bound to do so;
                    ``(B) any security futures product on or related to 
                the security; or
                    ``(C) any security-based swap involving the 
                security or the issuer of the security;
            ``(2) any transaction in connection with any security with 
        relation to which that person has, directly or indirectly, any 
        interest in any--
                    ``(A) put, call, straddle, option, or privilege 
                described in paragraph (1);
                    ``(B) security futures product described in 
                paragraph (1); or
                    ``(C) security-based swap described in paragraph 
                (1); or
            ``(3) any transaction in any security for the account of 
        any person who that person has reason to believe has, and who 
        actually has, directly or indirectly, any interest in any--
                    ``(A) put, call, straddle, option, or privilege 
                described in paragraph (1);
                    ``(B) security futures product with relation to 
                such security described in paragraph (1); or
                    ``(C) any security-based swap involving such 
                security or the issuer of such security.''.
    (c) Position Limits and Position Accountability for Security-Based 
Swaps or Security Derivatives.--The Securities Exchange Act of 1934 (15 
U.S.C. 78a et seq.) is amended by inserting after section 10A the 
following new section:

``SEC. 10B. POSITION LIMITS AND POSITION ACCOUNTABILITY FOR SECURITY-
              BASED SWAPS OR SECURITY DERIVATIVES.

    ``(a) Rulemaking Authority.--
            ``(1) In general.--As a means reasonably designed to 
        prevent fraud or manipulation, the Commission, by rule, 
        regulation, or order, as necessary or appropriate in the public 
        interest, for the protection of investors, or otherwise in 
        furtherance of the purposes of this title, may--
                    ``(A) prescribe requirements regarding the size of 
                positions that may be held by or on behalf of any 
                person or persons in any security-based swap (or 
                security derivative, as the Commission determines by 
                rule, regulation, or order) and any security on which 
                such security-based swap (or security derivative) is 
                based or referenced, or as to which the issuer of such 
                security is referenced; and
                    ``(B) require any person that effects transactions 
                for his own account or the account of others in any 
                security-based swap (or security derivative, as the 
                Commission determines by rule, regulation, or order) 
                and any security on which such security-based swap (or 
                security derivative) is based or referenced, or the 
                issuer of such security is referenced, to report such 
                information as the Commission may prescribe regarding 
                any position or positions in security-based swaps (or 
                security derivatives) and any security on which such 
                security-based swap (or security derivative) is based 
                or referenced, or as to which the issuer of such 
                security is referenced.
            ``(2) Exemptions authorized.--The Commission, by rule, 
        regulation, or order, may conditionally or unconditionally 
        exempt any person or class of persons, any security-based swap 
        (or security derivative) or class of security-based swaps (or 
        security derivatives), or any transaction or class of 
        transactions from any requirement that the Commission may 
        establish under this subsection.
    ``(b) Self-Regulatory Organizations.--As a means reasonably 
designed to prevent fraud or manipulation, the Commission, by rule, 
regulation, or order, as necessary or appropriate in the public 
interest, for the protection of investors, or otherwise in furtherance 
of the purposes of this title, may direct a self-regulatory 
organization--
            ``(1) to adopt rules regarding the size of positions in any 
        security-based swap (or security derivative) and any security 
        on which such security-based swap (or security derivative) is 
        based or referenced, or as to which the issuer of such security 
        is referenced that may be held by--
                    ``(A) any member of such self-regulatory 
                organization; or
                    ``(B) any person for whom a member of such self-
                regulatory organization effects transactions in such 
                security-based swap, security derivative, or other 
                security; and
            ``(2) to adopt rules reasonably designed to assure 
        compliance with requirements prescribed by the Commission under 
        subsection (a).''.
    (d) State Gaming and Bucket Shop Laws.--Section 28(a) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78bb(a)) is amended to read 
as follows:
    ``(a) State Gaming and Bucket Shop Laws.--
            ``(1) In general.--Except as provided in subsection (f), 
        the rights and remedies provided by this title shall be in 
        addition to any and all other rights and remedies that may 
        exist at law or in equity, but no person permitted to maintain 
        a suit for damages under the provisions of this title shall 
        recover, through satisfaction of judgment in 1 or more actions, 
        a total amount in excess of the actual damages of that person 
        due to the act that is the subject of the action.
            ``(2) Rule of construction.--Except as otherwise 
        specifically provided in this title, nothing in this title 
        shall affect the jurisdiction of the securities commission (or 
        any agency or officer performing like functions) of any State 
        over any security or any person, to the extent that the 
        exercise thereof does not conflict with the provisions of this 
        title or the rules and regulations thereunder.
            ``(3) Gaming laws.--No provision of State law which 
        prohibits or regulates the making or promoting of wagering or 
        gaming contracts, or the operation of `bucket shops' or other 
        similar or related activities, shall invalidate--
                    ``(A) any put, call, straddle, option, privilege, 
                or other security that is subject to regulation under 
                this title (except a security-based swap and any 
                security that has a pari-mutual payout or otherwise is 
                determined by the Commission, acting by rule, 
                regulation, or order, to be appropriately subject to 
                such laws), or apply to any activity which is 
                incidental or related to the offer, purchase, sale, 
                exercise, settlement, or closeout of any such security;
                    ``(B) any security-based swap between eligible 
                contract participants; or
                    ``(C) any security-based swap effected on a 
                national securities exchange that is registered 
                pursuant to section 6(b).
            ``(4) Security futures product.--No provision of State law 
        regarding the offer, sale, or distribution of securities shall 
        apply to any transaction in a security futures product, except 
        that this paragraph may not be construed as limiting any State 
        antifraud law of general applicability.''.

SEC. 107. PROTECTIONS FOR MARKETING SECURITY-BASED SWAPS TO CERTAIN 
              PERSONS.

    (a) Trading in Security-Based Swaps.--Section 6 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78f), as amended by this Act, is 
amended by adding at the end the following:
    ``(i) Eligible Contract Participants.--It shall be unlawful for any 
person to effect a transaction in a security-based swap with or for a 
person that is not an eligible contract participant, unless such 
transaction is effected on a national securities exchange registered 
pursuant to subsection (b).''.
    (b) Registration of Security-Based Swaps.--Section 5 of the 
Securities Act of 1933 (15 U.S.C. 77e) is amended by adding at the end 
the following:
    ``(d) Registration of Security-Based Swaps.--Notwithstanding the 
provisions of section 3 or 4, unless a registration statement meeting 
the requirements of section 10(a) is in effect with respect to a 
security-based swap, it shall be unlawful for any person, directly or 
indirectly, to make use of any means or instruments of transportation 
or communication in interstate commerce or of the mails to offer to 
sell, offer to buy, or purchase, sell, or buy a security-based swap to 
any person who is not an eligible contract participant, as defined in 
section 3(a)(66) of the Securities Exchange Act of 1934.''.

SEC. 108. ENFORCEMENT.

    Section 21 of the Securities Exchange Act of 1934 (15 U.S.C. 78u) 
is amended by adding at the end the following:
    ``(j) Enforcement of Provisions Applicable to Derivatives Market 
Participants.--
            ``(1) In general.--In addition to enforcement by the 
        Commission under the securities laws of compliance with 
        sections 6(l), 13(m), 15F(a), 15F(c), 15F(d), 17(l), 17C(b)(1), 
        and 17C(c)(1), compliance with such sections shall be enforced 
        under--
                    ``(A) section 8 of the Federal Deposit Insurance 
                Act (12 U.S.C. 1818), by the appropriate Federal 
                banking agency, in the case of an insured depository 
                institution, as those terms are defined in section 3 of 
                that Act (12 U.S.C. 1813), other than an affiliate of 
                an insured depository institution, as defined in 
                section 3 of that Act (12 U.S.C. 1813);
                    ``(B) the Commodity Exchange Act (7 U.S.C. 1 et 
                seq.), by the Commodity Futures Trading Commission, in 
                the case of a futures commission merchant, introducing 
                broker, commodity pool operator, or commodity trading 
                advisor, as those terms are defined in sections 1a of 
                the Commodity Exchange Act, other than an affiliate of 
                an insured depository institution, as defined in 
                section 3 of the Federal Deposit Insurance Act (12 
                U.S.C. 1813); and
                    ``(C) the Federal Housing Enterprises Financial 
                Safety and Soundness Act of 1992 (12 U.S.C. 4501 et 
                seq.), by the Federal Housing Finance Agency, in the 
                case of a regulated entity, as defined in section 1303 
                of the Federal Housing Enterprises Financial Safety and 
                Soundness Act of 1992 (12 U.S.C. 4502).
            ``(2) Violations treated as violations of other laws.--For 
        purposes of the exercise by any agency referred to in paragraph 
        (1), a violation of sections 6(l), 13(m), 15F(a), 15F(c), 
        15F(d), 17(l), 17C(b)(1), and 17C(c)(1) of this title shall be 
        deemed to be a violation of a requirement imposed under that 
        provision of law. In addition to its powers under any provision 
        of law specifically referred to in paragraph (1), each of the 
        agencies referred to in that paragraph may exercise, for the 
        purpose of enforcing compliance with sections 6(l), 13(m), 
        15F(a), 15F(c), 15F(d), 17(l), 17C(b)(1), and 17C(c)(1) of this 
        title, any other authority conferred on such agency by law.''.

SEC. 109. ENFORCEABILITY OF SECURITY-BASED SWAPS.

    Section 29(b)(2) of the Securities Exchange Act of 1934 (15 U.S.C. 
78cc(b)(2)) is amended by striking ``and (B)'' and inserting the 
following: ``, (B) that no agreement, contract, or transaction that is 
a security-based swap shall be void, voidable, or unenforceable by 
either party to such security-based swap, and no party thereto shall be 
entitled to rescind, or recover any payment made with respect to, such 
security-based swap under this section or any other provision of 
securities laws based solely on the failure of either party to the 
agreement, contract, or transaction to satisfy its respective 
obligations under sections 6(l), 10B, 13, 15(b), 15F, 17, and 17C of 
this title with respect to such security-based swap, and (C)''.

SEC. 110. TRANSFER AND RIGHTS OF CERTAIN CFTC EMPLOYEES.

    (a) Transfer.--Each employee of the Commodity Futures Trading 
Commission (in this section referred to as the ``CFTC'') whose position 
and responsibilities would be more effectively utilized at the 
Securities and Exchange Commission (in this section referred to as the 
``SEC''), based on this Act and the amendments made by this Act, as 
determined by the Secretary of the Treasury, shall be transferred to 
the SEC for employment, not later than 60 days after the date of 
enactment of this Act. Such transfer shall be deemed a transfer of 
function for purposes of section 3503 of title 5, United States Code.
    (b) Guaranteed Positions.--
            (1) In general.--Each employee transferred under subsection 
        (a) shall be guaranteed a position with equivalent status, 
        tenure, pay and benefits as that held on the day immediately 
        preceding the transfer, subject to paragraph (2).
            (2) No involuntary separation or reduction.--An employee 
        transferred under subsection (a) holding a permanent position 
        on the day immediately preceding the transfer may not be 
        involuntarily separated or reduced in grade or compensation 
        during the 12-month period beginning on the date of transfer, 
        except for cause, or, in the case of a temporary employee, 
        separated in accordance with the terms of the appointment of 
        the employee.
    (c) Appointment Authority for Excepted and Senior Executive Service 
Employees.--
            (1) In general.--In the case of an employee of the CFTC 
        occupying a position in the excepted service or the Senior 
        Executive Service, such employee shall, on and after the date 
        of transfer to the SEC, be deemed to be appointed under the 
        appointment authority of the SEC for filling an equivalent 
        position at the SEC, subject to paragraph (2).
            (2) Declining application of equivalent appointment 
        authority.--The Chairman of the SEC may decline the application 
        of the equivalent appointment authority of the SEC to an 
        employee of the CFTC occupying a position in the excepted 
        service or the Senior Executive Service under paragraph (1) to 
        the extent that the authority by which the employee was 
        appointed by the CFTC relates to--
                    (A) a position excepted from the competitive 
                service because of its confidential, policymaking, 
                policy-determining, or policy-advocating character; or
                    (B) a noncareer position in the Senior Executive 
                Service (within the meaning of section 3132(a)(7) of 
                title 5, United States Code).
    (d) Reorganization.--If the Chairman of the SEC determines, after 
the end of the 1-year period beginning on the date of enactment of this 
Act, that a reorganization of the combined workforce is required, that 
reorganization shall be deemed a major reorganization for purposes of 
affording affected employee retirement under section 8336(d)(2) or 
8414(b)(1)(B) of title 5, United States Code.

          TITLE II--REGULATION OF COMMODITY-BASED DERIVATIVES

SEC. 201. DEFINITIONS.

    Section 1a of the Commodity Exchange Act (7 U.S.C. 1a) is amended--
            (1) by striking paragraphs (1), (25), (31), and (32);
            (2) by redesignating paragraphs (2) through (4), (5) 
        through (8), (9) through (24), (26) through (28), (29), (30), 
        (33), and (34) as paragraphs (1) through (3), (7) through (10), 
        (12) through (27), (28) through (30), (32), (33), (35), and 
        (37), respectively;
            (3) by inserting after paragraph (3) (as redesignated by 
        paragraph (2) of this section) the following:
            ``(4) Commodity-based swap.--The term `commodity-based 
        swap' means a swap that is not a security-based swap, as 
        defined in section 3(a) of the Securities Exchange Act of 1934 
        (15 U.S.C. 78c(a)).
            ``(5) Commodity-based swap execution facility.--The term 
        `commodity-based swap execution facility' means a trading 
        facility registered under section 5h.
            ``(6) Commodity derivative.--The term `commodity 
        derivative' means any derivative that is a contract of sale for 
        future delivery of any commodity (or option on a contract of 
        sale for future delivery of any commodity) subject to the 
        exclusive jurisdiction of the Commission under this Act, other 
        than a swap.'';
            (4) by inserting after paragraph (10) (as redesignated by 
        paragraph (2) of this section) the following:
            ``(11) Derivative.--The term `derivative' has the meaning 
        given the term in section 3(a) of the Securities Exchange Act 
        of 1934 (15 U.S.C. 78c(a)).'';
            (5) by inserting after paragraph (30) (as redesignated by 
        paragraph (2) of this section) the following:
            ``(31) Person associated with a significant commodity-based 
        derivatives market participant.--
                    ``(A) In general.--The term `person associated with 
                a significant commodity-based derivatives market 
                participant' means--
                            ``(i) any partner, officer, director, or 
                        branch manager of a significant commodity-based 
                        derivatives market participant (including any 
                        individual who holds a similar status or 
                        performs a similar function with respect to any 
                        partner, officer, director, or branch manager 
                        of a significant commodity-based derivatives 
                        market participant);
                            ``(ii) any person that directly or 
                        indirectly controls, is controlled by, or is 
                        under common control with a significant 
                        commodity-based derivatives market participant; 
                        and
                            ``(iii) any employee of a significant 
                        commodity-based derivatives market participant.
                    ``(B) Exclusion.--Other than for purposes of 
                section 4s, the term `person associated with a 
                significant commodity-based derivatives market 
                participant' does not include any person associated 
                with a significant commodity-based derivatives market 
                participant the functions of which are solely clerical 
                or ministerial.'';
            (6) in paragraph (32) (as redesignated by paragraph (2) of 
        this section)--
                    (A) by striking subparagraph (D) and inserting the 
                following:
                    ``(D) a commodity-based swap execution facility 
                registered under section 5h;'';
                    (B) in subparagraph (E), by striking the period and 
                inserting a semicolon; and
                    (C) by adding at the end the following:
                    ``(F) a significant commodity-based derivatives 
                market participant; and
                    ``(G) a trade repository under section 4r.'';
            (7) by inserting after paragraph (33) (as redesignated by 
        paragraph (2) of this section) the following:
            ``(34) Significant commodity-based derivatives market 
        participant.--
                    ``(A) In general.--The term `significant commodity-
                based derivatives market participant' means--
                            ``(i) any person that is engaged in the 
                        business of purchasing or selling 1 or more 
                        commodity-based swaps for the account of the 
                        person or for any other individual or entity, 
                        or making a market in commodity-based swaps, 
                        and the 1 or more purchases or sales of which 
                        are not solely for the purpose of managing the 
                        risk associated with--
                                    ``(I) an asset that is, or is 
                                anticipated to be, owned, produced, 
                                manufactured, processed, or 
                                merchandised;
                                    ``(II) potential changes in the 
                                value of services to be purchased or 
                                provided, or anticipated to be 
                                purchased or provided; or
                                    ``(III) a liability incurred or 
                                anticipated to be incurred by a person 
                                that is not, or is not related to, a 
                                commodity-based swap; or
                            ``(ii) any other person designated by the 
                        Commission, after consultation with the 
                        Securities and Exchange Commission, by rule, 
                        regulation, or order as is appropriate to 
                        further--
                                    ``(I) the interests of the public;
                                    ``(II) the protection of market 
                                participants; or
                                    ``(III) the purposes of this Act.
                    ``(B) Exclusion.--The term `significant commodity-
                based derivatives market participant' does not include 
                an investment company registered under the Investment 
                Company Act of 1940 (15 U.S.C. 80a-1 et seq.).'';
            (8) by inserting after paragraph (35) (as redesignated by 
        paragraph (2) of this section) the following:
            ``(36) Swap.--The term `swap' has the meaning given the 
        term in section 3(a) of the Securities Exchange Act of 1934 (15 
        U.S.C. 78c(a)).''; and
            (9) by adding at the end the following:
            ``(38) Trade repository.--The term `trade repository' means 
        any person that collects, calculates, processes, or prepares 
        information with respect to 1 or more transactions or positions 
        in 1 or more commodity-based swaps.''.

SEC. 202. RATIONALIZATION OF FINANCIAL PRODUCT OVERSIGHT.

    (a) CFTC Authority Over Commodity-Based Swaps.--
            (1) Amendments to commodity futures modernization act of 
        2000.--
                    (A) Definitions.--Section 402 of the Commodity 
                Futures Modernization Act of 2000 (7 U.S.C. 27) is 
                amended by striking subsection (d).
                    (B) Exclusion of covered swap agreements.--Section 
                407 of the Commodity Futures Modernization Act of 2000 
                (7 U.S.C. 27e) is repealed.
                    (C) Contract enforcement.--Section 408 of the 
                Commodity Futures Modernization Act of 2000 (7 U.S.C. 
                27f) is amended by striking subsections (b) and (c) and 
                inserting the following:
    ``(b) Preemption.--This title shall supersede and preempt the 
application of any State or local law that prohibits or regulates 
gaming or the operation of bucket shops (other than antifraud 
provisions of general applicability) in the case of a hybrid instrument 
that is predominantly a banking product.''.
            (2) Amendments to commodity exchange act.--
                    (A) In general.--Section 2 of the Commodity 
                Exchange Act (7 U.S.C. 2) is amended--
                            (i) in subsection (a)(1)--
                                    (I) in the first sentence of 
                                subparagraph (A), by striking 
                                ``subparagraphs (C) and (D) of this 
                                paragraph and subsections (c) through 
                                (i) of this section'' and inserting 
                                ``subparagraph (C) and subsections (c) 
                                through (e)'';
                                    (II) in subparagraph (C), by 
                                striking clauses (ii) through (v) and 
                                inserting the following:
                            ``(ii) Contracts of sale for future 
                        delivery.--This Act shall not apply to, and the 
                        Commission shall have no jurisdiction to 
                        designate a board of trade as a contract market 
                        for any contract of sale (or option on such 
                        contract) for future delivery--
                                    ``(I) of any security, or interest 
                                in a security or based on the value of 
                                a security (other than an exempted 
                                security under section 3(a) of the 
                                Securities Exchange Act of 1934 (15 
                                U.S.C. 78c(a)), as in effect on the 
                                date of enactment of the Futures 
                                Trading Act of 1982 (other than any 
                                municipal security, as defined in that 
                                section 3(a), as in effect on the date 
                                of enactment of the Futures Trading Act 
                                of 1982), or any group or index of such 
                                securities or any interest in a 
                                security or based on the value of a 
                                security; or
                                    ``(II) based on any financial, 
                                economic, or commercial occurrence, 
                                extent of an occurrence, contingency, 
                                or consequence that is related to or 
                                based on a security, an interest in a 
                                security, or an issuer of a security, 
                                or based on the value of any of the 
                                foregoing (other than an exempted 
                                security under section 3(a) of the 
                                Securities Exchange Act of 1934 (15 
                                U.S.C. 78c(a)), as in effect on the 
                                date of enactment of the Futures 
                                Trading Act of 1982 (other than any 
                                municipal security, as defined in that 
                                section 3(a), as in effect on the date 
                                of enactment of the Futures Trading Act 
                                of 1982), or any group or index of such 
                                securities, or interests in such 
                                securities or issuers of such 
                                securities, or based on the value of 
                                any of the foregoing.''; and
                                    (III) by striking subparagraphs 
                                (D), (E), and (F);
                            (ii) by striking subsections (d), (e), (g), 
                        (h), and (i);
                            (iii) by inserting after subsection (c) the 
                        following:
    ``(d) Commodity-Based Swaps.--Nothing in this Act (other than 
subsections (a)(1)(B), (a)(1)(C), (e) and (f), sections 4a, 4b, 4b-1, 
4c(a), 4c(b), 4o, 4r, 4s, 4t, 5b, 5c, 5h, 6(c), 6(d), 6c, 6d, 8, 8a, 9, 
12(e)(2), 12(f), 13(a), 13(b), 21, and 22(a)(4) and such other 
provisions of this Act as are applicable by the terms of the provisions 
to registered entities and Commission registrants) governs or applies 
to a commodity-based swap.''; and
                            (iv) by redesignating subsection (f) as 
                        subsection (e).
                    (B) Conforming amendments.--
                            (i) Section 1a of the Commodity Exchange 
                        Act (7 U.S.C. 1a) (as amended by section 
                        201(2)) is amended in paragraph (35) by 
                        inserting before the period at the end the 
                        following: ``(as in effect on the day before 
                        the date of enactment of the Comprehensive 
                        Derivatives Regulation Act of 2009)''.
                            (ii) Section 5c(a)(1) of the Commodity 
                        Exchange Act (7 U.S.C. 7a-2(a)(1)) is amended 
                        by striking ``, and section 2(h)(7) with 
                        respect to significant price discovery 
                        contracts,''.
                            (iii) Section 5d(a) of the Commodity 
                        Exchange Act (7 U.S.C. 7a-3(a)) is amended in 
                        the second sentence by striking ``subparagraphs 
                        (C) and (D) of section 2(a)(1)'' and inserting 
                        ``section 2(a)(1)(C)''.
                            (iv) Section 5e of the Commodity Exchange 
                        Act (7 U.S.C. 7b) is amended by striking ``, or 
                        revocation of the right'' and all that follows 
                        through ``significant price discovery 
                        contract,''.
                            (v) Section 6(b) of the Commodity Exchange 
                        Act (7 U.S.C. 8(b)) is amended in the first 
                        sentence by striking ``, or to revoke the 
                        right'' and all that follows through 
                        ``significant price discovery contract,''.
                            (vi) Section 22(b)(1)(A) of the Commodity 
                        Exchange Act (7 U.S.C. 25(b)(1)(A)) is amended 
                        by striking ``section 2(h)(7) or''.
                            (vii) Section 408(2)(C) of the Federal 
                        Deposit Insurance Corporation Improvement Act 
                        of 1991 (12 U.S.C. 4421(2)(C)) is amended--
                                    (I) by striking ``, 2(d), 2(f), or 
                                2(g)''; and
                                    (II) by striking ``2(h) or''.
            (3) Amendments to the gramm-leach-bliley act.--Section 206 
        of the Gramm-Leach-Bliley Act (15 U.S.C. 78c note) is amended--
                    (A) in subsection (a)--
                            (i) in paragraph (4), by inserting ``or'' 
                        after the semicolon at the end;
                            (ii) in paragraph (5) by striking ``; or'' 
                        at the end and inserting a period; and
                            (iii) by striking paragraph (6);
                    (B) by striking subsection (b); and
                    (C) by redesignating subsections (c) and (d) as 
                subsections (b) and (c), respectively.
    (b) Rationalization of Security Futures Oversight.--
            (1) In general.--
                    (A) Rulemaking authority to address duplicative 
                regulations of dual registrants.--Section 4d of the 
                Commodity Exchange Act (7 U.S.C. 6d) is amended by 
                striking subsection (c).
                    (B) Registration of futures commission merchants, 
                introducing brokers, and floor brokers.--Section 4f(a) 
                of the Commodity Exchange Act (7 U.S.C. 6f(a)) is 
                amended--
                            (i) in paragraph (1), by striking ``(1)''; 
                        and
                            (ii) by striking paragraphs (2) through 
                        (4).
                    (C) Dual trading.--Section 4j of the Commodity 
                Exchange Act (7 U.S.C. 6j) is repealed.
                    (D) Exemptions for associated persons or securities 
                broker-dealers.--Section 4k of the Commodity Exchange 
                Act (7 U.S.C. 6k) is amended by striking paragraph (5) 
                (as added by section 252(d) of the Commodity Futures 
                Modernization Act of 2000 (114 Stat. 2763A-448)).
                    (E) Election to trade excluded and exempt 
                commodities.--Section 5a of the Commodity Exchange Act 
                (7 U.S.C. 7a) is amended by striking subsection (g).
                    (F) Obligation to address duplicative regulation of 
                dual registrants.--Section 5c of the Commodity Exchange 
                Act (7 U.S.C. 7a-2) is amended by striking subsection 
                (f).
                    (G) Designation of securities exchanges and 
                associations as contract markets.--Section 5f of the 
                Commodity Exchange Act (7 U.S.C. 7b-1) is repealed.
                    (H) Notification of investigations and enforcement 
                actions.--Section 6 of the Commodity Exchange Act is 
                amended by striking subsection (g) (7 U.S.C. 9c).
                    (I) Action to enjoin or restrain violations.--
                Section 6c of the Commodity Exchange Act (7 U.S.C. 13a-
                1) is amended by striking subsection (h).
                    (J) Public disclosure.--Section 8(a) of the 
                Commodity Exchange Act (7 U.S.C. 12(a)) is amended by 
                striking paragraph (3).
                    (K) Market reports.--Section 16 of the Commodity 
                Exchange Act (7 U.S.C. 20) is amended by striking 
                subsection (e).
                    (L) Obligation to address duplicative regulation of 
                dual registrants.--Section 17 of the Commodity Exchange 
                Act (7 U.S.C. 21) is amended--
                            (i) by striking subsection (r); and
                            (ii) by redesignating subsection (q) (as 
                        added by section 233(5) of Public Law 97-444 
                        (96 Stat. 2320)) as subsection (r).
            (2) Conforming amendments to the commodity exchange act.--
                    (A) Section 1a of the Commodity Exchange Act (7 
                U.S.C. 1a) (as amended by section 201(2)) is amended in 
                paragraph (28), by striking the second sentence.
                    (B) Section 4(c)(1) of the Commodity Exchange Act 
                (7 U.S.C. 6(c)(1)) is amended by striking ``(except 
                subparagraphs (C)(ii) and (D) of section 2(a)(1), 
                except that the Commission and the Securities and 
                Exchange Commission may by rule, regulation, or order 
                jointly exclude any agreement, contract, or transaction 
                from section 2(a)(1)(D))''.
                    (C) Section 5a of the Commodity Exchange Act (7 
                U.S.C. 7a) is amended--
                            (i) in subsection (b)--
                                    (I) in paragraph (2)--
                                            (aa) by striking 
                                        subparagraph (D); and
                                            (bb) by redesignating 
                                        subparagraphs (E) and (F) as 
                                        subparagraphs (D) and (E), 
                                        respectively; and
                                    (II) in paragraph (3)(B)(ii), by 
                                striking ``or, if the person trades 
                                only security futures products on the 
                                facility, a national securities 
                                association registered under section 
                                15A(a) of the Securities Exchange Act 
                                of 1934''; and
                            (ii) in subsection (e)(1), by striking 
                        ``With respect to transactions other than 
                        transactions in security futures products, a'' 
                        and inserting ``A''.
                    (D) Section 6(b) of the Commodity Exchange Act (7 
                U.S.C. 8(b)) is amended in the first sentence by 
                striking ``or section 5f''.
                    (E) Section 12(e)(2) of the Commodity Exchange Act 
                (7 U.S.C. 16(e)(2)) is amended--
                            (i) in subparagraph (A), by striking ``an 
                        electronic trading facility excluded under 
                        section 2(e) of this Act'' and inserting ``a 
                        commodity-based swap execution facility'';
                            (ii) in subparagraph (B)--
                                    (I) by striking ``, 2(d), 2(f), or 
                                2(g)'' and inserting ``or 2(e)'';
                                    (II) by striking ``2(h) or''; and
                                    (III) by striking the period at the 
                                end and inserting ``; and''; and
                            (iii) by inserting after subparagraph (B) 
                        the following:
                    ``(C) a commodity-based swap.''.

SEC. 203. REQUIRED CLEARING OF STANDARDIZED DERIVATIVES THROUGH CENTRAL 
              COUNTERPARTIES AND USE OF TRADE REPOSITORIES.

    (a) In General.--The Commodity Exchange Act is amended by inserting 
after section 4q (7 U.S.C. 6o-1) the following:

``SEC. 4R. REQUIRED CLEARING OF STANDARDIZED DERIVATIVES THROUGH 
              CENTRAL COUNTERPARTIES AND USE OF TRADE REPOSITORIES.

    ``(a) Findings.--Congress finds that--
            ``(1) the proliferation of over-the-counter commodity-based 
        swaps poses unacceptable risks to the financial system;
            ``(2) clearing standardized commodity-based swaps through 
        well-regulated central counterparties would reduce systemic 
        risk in the financial system;
            ``(3) the markets for standardized commodity-based swaps 
        suffer from a lack of reliable and accurate transaction 
        information that is available to the public, market 
        participants, producers, and regulators; and
            ``(4) weaknesses in the regulation of markets for 
        standardized commodity-based swaps have detracted from the 
        efficiency and transparency of trading in the markets and 
        hampered the surveillance and oversight of the markets.
    ``(b) Purposes.--The purposes of this section are--
            ``(1) to establish well-regulated markets for standardized 
        commodity-based swaps that promote efficiency and transparency 
        of trading and enhance the surveillance and oversight of the 
        markets; and
            ``(2) to promote the public interest, the protection of 
        market participants, and the maintenance of fair and orderly 
        markets by ensuring--
                    ``(A) the prompt and accurate clearance and 
                settlement of transactions in standardized commodity-
                based swaps;
                    ``(B) the prompt and accurate reporting of 
                transactions in commodity-based derivative instruments 
                to a trade repository or a derivatives clearing 
                organization;
                    ``(C) the establishment of linked or coordinated 
                facilities for clearance and settlement of transactions 
                in securities, securities options, contracts of sale 
                for future delivery and options on the contracts, 
                commodity options, and derivatives;
                    ``(D) the availability to the public, market 
                participants, producers, and regulators of reliable and 
                accurate quotation and transaction information in 
                commodity-based swaps;
                    ``(E) economically efficient execution of 
                transactions in commodity-based swaps; and
                    ``(F) fair competition among markets in the trading 
                of commodity-based swaps.
    ``(c) Use of Derivatives Clearing Organizations.--
            ``(1) In general.--Any person that is a party to a 
        commodity-based swap that the Commission determines is 
        `standardized' shall submit such instrument for clearing to a 
        derivatives clearing organization within the period specified 
        by the rules of the Commission.
            ``(2) Definition of `standardized'.--
                    ``(A) In general.--The Commission shall by rule, 
                define the term `standardized' for purposes of this 
                section.
                    ``(B) Factors.--In defining the term 
                `standardized', the Commission shall--
                            ``(i) be consistent with--
                                    ``(I) the public interest;
                                    ``(II) the protection of market 
                                participants;
                                    ``(III) the safeguarding of 
                                commodity-based swap transactions and 
                                funds;
                                    ``(IV) the maintenance of fair 
                                competition among market participants 
                                and among derivatives clearing 
                                organizations; and
                                    ``(V) the purposes of this section;
                            ``(ii)(I) consult with, and consider the 
                        views of, the Securities and Exchange 
                        Commission and the Board of Governors of the 
                        Federal Reserve System; and
                            ``(II) seek to maintain comparability, to 
                        the maximum extent practicable, with the 
                        Securities and Exchange Commission definition 
                        of `standardized' for purposes of section 17C 
                        of the Securities Exchange Act of 1934; and
                            ``(iii) to the extent it is applicable to a 
                        particular commodity-based swap or class of 
                        commodity-based derivative swaps, consider--
                                    ``(I) whether a derivatives 
                                clearing organization is prepared to 
                                clear the commodity-based swap and the 
                                derivatives clearing organization has 
                                effective risk management systems;
                                    ``(II) the availability or ability 
                                to facilitate standard documentation of 
                                the terms of the commodity-based swap;
                                    ``(III) the liquidity of the 
                                commodity-based swap and the underlying 
                                commodity or group or index of the 
                                commodity-based swap;
                                    ``(IV) the ability to value the 
                                commodity-based swap, or underlying 
                                commodity, consistently with an 
                                accepted pricing methodology, including 
                                the availability of intraday prices; 
                                and
                                    ``(V) such other factors as are 
                                consistent with the purposes of this 
                                section.
            ``(3) Exemptions.--
                    ``(A) In general.--The Commission, by rule or 
                order, as the Commission considers appropriate in the 
                public interest or the protection of market 
                participants, may conditionally or unconditionally 
                exempt from the requirements of this subsection and the 
                rules issued under this subsection any person, 
                transaction, or standardized commodity-based swap.
                    ``(B) Prior consultation with securities and 
                exchange commission and board of governors of the 
                federal reserve system.--
                            ``(i) Consultation.--Before acting by rule 
                        or order to exempt any person, transaction, or 
                        standardized commodity-based swap from this 
                        subsection, the Commission shall consult with, 
                        and consider the views of, the Securities and 
                        Exchange Commission and the Board of Governors 
                        of the Federal Reserve System concerning 
                        whether the exemption is appropriate for the 
                        reduction of risk and in the public interest.
                            ``(ii) Notice required.--Forty-five days 
                        prior to issuing any exemption, the Commission 
                        shall send a notice to the Securities and 
                        Exchange Commission and the Board of Governors 
                        of the Federal Reserve System describing such 
                        exemption.
                            ``(iii) Prohibition on issuance.--If either 
                        the Securities and Exchange Commission or the 
                        Board of Governors of the Federal Reserve 
                        System issues a finding that such an exemption 
                        does not meet the standard in clause (i), the 
                        Commission shall not grant the exemption.
                            ``(iv) Deadline.--Any finding by the 
                        Securities and Exchange Commission or the Board 
                        of Governors of the Federal Reserve System 
                        shall be made and received in writing by the 
                        Commission not later than 30 days after the 
                        date of receipt of a notice of a proposed 
                        exemption by the Commission.
                            ``(v) Nondelegation.--Action by the 
                        Securities and Exchange Commission or the Board 
                        of Governors under this subparagraph may not be 
                        delegated.
    ``(d) Trade Repositories.--
            ``(1) Use of trade repositories.--
                    ``(A) In general.--Any person that enters into or 
                effects a transaction in a commodity-based swap shall 
                submit the transaction for clearing to a derivatives 
                clearing organization or report the transaction to a 
                trade repository registered in accordance with this 
                subsection within the period specified by any rule 
                adopted under subsection (e).
                    ``(B) Information.--The Commission may, by rule, 
                require any person to report to derivatives clearing 
                organizations and registered trade repositories such 
                transaction information as the Commission considers 
                appropriate to permit the derivatives clearing 
                organizations and trade repositories to meet the 
                purposes of this section.
            ``(2) Registration.--A trade repository may register for 
        purposes of this subsection by filing with the Commission an 
        application in such form as the Commission, by rule, may 
        prescribe containing the rules of the trade repository and such 
        other information and documents as the Commission, by rule, may 
        prescribe as appropriate in the public interest, for the 
        protection of market participants, or for the prompt and 
        accurate collection, calculation, processing, and preparation 
        of information regarding transactions and positions in 
        commodity-based swap.
            ``(3) Commission procedures for applications.--
                    ``(A) In general.--On the filing of an application 
                for registration pursuant to paragraph (2), the 
                Commission shall publish notice of the filing and 
                afford interested persons an opportunity to submit 
                written data, views, and arguments concerning the 
                application.
                    ``(B) Actions.--Not later than 90 days after the 
                date of the publication of the notice (or, with the 
                consent of the applicant, a longer period), the 
                Commission shall--
                            ``(i) by order grant the registration; or
                            ``(ii) institute proceedings to determine 
                        whether the registration should be denied.
                    ``(C) Procedure for denials.--
                            ``(i) In general.--The proceedings 
                        described in subparagraph (B)(ii) shall--
                                    ``(I) include notice of the grounds 
                                for denial under consideration and an 
                                opportunity for a hearing; and
                                    ``(II) be concluded not later than 
                                180 days after the date of publication 
                                of notice of the filing of the 
                                application for registration.
                            ``(ii) Actions.--At the conclusion of the 
                        proceedings the Commission, by order, shall 
                        grant or deny the registration.
                            ``(iii) Extensions.--The Commission may 
                        extend the time for the conclusion of the 
                        proceedings for--
                                    ``(I) not more than 60 days if the 
                                Commission--
                                            ``(aa) finds good cause for 
                                        the extension; and
                                            ``(bb) publishes a 
                                        description of the reasons of 
                                        the Commission for the finding; 
                                        or
                                    ``(II) with the consent of the 
                                applicant, a longer period.
                    ``(D) Standards for granting registration.--The 
                Commission shall grant the registration of a trade 
                repository for purposes of this section if the 
                Commission finds that the trade repository is so 
                organized, and has the capacity--
                            ``(i) to assure the prompt, accurate, and 
                        reliable performance of the functions of a 
                        trade repository;
                            ``(ii) to comply with this Act (including 
                        rules and regulations issued under this Act); 
                        and
                            ``(iii) to carry out the functions of a 
                        trade repository in a manner consistent with 
                        the purposes of this section.
                    ``(E) Standard for denial of registration.--The 
                Commission shall deny the registration of a trade 
                repository if the Commission does not make a finding 
                described in subparagraph (D).
            ``(4) Withdrawal of registration.--
                    ``(A) In general.--A registered trade repository 
                may, on such terms and conditions as the Commission 
                considers appropriate in the public interest or for the 
                protection of market participants, withdraw from 
                registration by filing a written notice of withdrawal 
                with the Commission.
                    ``(B) Cancellation.--If the Commission finds that 
                any trade repository is no longer in existence or has 
                ceased to do business in the capacity specified in the 
                application of the trade repository for registration, 
                the Commission, by order, shall cancel the 
                registration.
            ``(5) Access to trade repository services.--
                    ``(A) Notice of prohibition or limitation on 
                access.--
                            ``(i) In general.--If any registered trade 
                        repository prohibits or limits any person 
                        access to services offered, directly or 
                        indirectly, by the trade repository, the 
                        registered trade repository shall promptly file 
                        notice of the prohibition or limitation with 
                        the Commission.
                            ``(ii) Content.--A notice under clause (i) 
                        shall be in such form and contain such 
                        information as the Commission, by rule, may 
                        prescribe as appropriate in the public interest 
                        or for the protection of investors.
                    ``(B) Review by commission.--Any prohibition or 
                limitation on access to services with respect to which 
                a registered trade repository is required by 
                subparagraph (A) to file notice shall be subject to 
                review by the Commission on--
                            ``(i) the motion of the Commission; or
                            ``(ii) application by any person aggrieved 
                        by the prohibition or limitation filed--
                                    ``(I) not later than 30 days after 
                                the date on which the notice described 
                                in subparagraph (A) has been filed with 
                                the Commission and received by the 
                                aggrieved person; or
                                    ``(II) within such longer period as 
                                the Commission may determine.
                    ``(C) Stays.--
                            ``(i) In general.--Application to the 
                        Commission for review, or the institution of 
                        review by the Commission on the motion of the 
                        Commission, shall not operate as a stay of the 
                        prohibition or limitation, unless the 
                        Commission otherwise orders, summarily or after 
                        notice and opportunity for hearing on the 
                        question of a stay.
                            ``(ii) Hearing.--A hearing under clause (i) 
                        may consist solely of the submission of 
                        affidavits or presentation of oral arguments.
                            ``(iii) Expedited procedure.--The 
                        Commission shall establish for appropriate 
                        cases an expedited procedure for consideration 
                        and determination of the question of a stay.
                    ``(D) Standards of review.--
                            ``(i) Dismissal of proceedings.--In any 
                        proceeding to review the prohibition or 
                        limitation of any person to access to services 
                        offered by a registered trade repository, the 
                        Commission, by order, shall dismiss the 
                        proceeding if the Commission finds, after 
                        notice and opportunity for hearing, that--
                                    ``(I) the prohibition or limitation 
                                is consistent with this Act (including 
                                rules and regulations); and
                                    ``(II) the person has not been 
                                discriminated against unfairly.
                            ``(ii) Access to services.--If the 
                        Commission does not make a finding described in 
                        clause (i) or the Commission finds that the 
                        prohibition or limitation imposes any burden on 
                        competition that is not appropriate in 
                        furtherance of the purposes of this Act, the 
                        Commission, by order, shall--
                                    ``(I) set aside the prohibition or 
                                limitation; and
                                    ``(II) require the registered trade 
                                repository to permit the person access 
                                to the services offered by the 
                                registered trade repository to which 
                                the prohibition or limitation applied.
            ``(6) Administrative proceeding authority.--The Commission, 
        by order, may censure or place limitations on the activities, 
        functions, or operations of any registered trade repository or 
        suspend for a period not exceeding 12 months or revoke the 
        registration of any trade repository, if the Commission finds, 
        on the record after notice and opportunity for hearing, that--
                    ``(A) the censure, placing of limitations, 
                suspension, or revocation is appropriate in the public 
                interest, for the protection of market participants, or 
                otherwise in furtherance of the purposes of this Act; 
                and
                    ``(B) the trade repository has violated or is 
                unable to comply with any provision of this Act 
                (including rules or regulations).
            ``(7) Rulemaking authority.--No registered trade repository 
        shall, directly or indirectly, engage in any activity as a 
        trade repository in contravention of such rules and regulations 
        as the Commission may prescribe--
                    ``(A) as appropriate in the public interest;
                    ``(B) for the protection of market participants; or
                    ``(C) otherwise in furtherance of the purposes of 
                this Act, including to ensure that all persons may 
                obtain on terms that are fair and reasonable and not 
                unreasonably discriminatory such transaction and 
                position information for commodity-based swaps as is 
                disseminated by any derivatives clearing organization 
                or trade repository.
            ``(8) Consultation.--
                    ``(A) In general.--Prior to adopting any rules 
                applicable to trade repositories pursuant to subsection 
                (g), the Commission shall consult with and consider the 
                views of the Securities and Exchange Commission.
                    ``(B) Comparability.--The Commission and the 
                Securities and Exchange Commission shall seek to 
                maintain comparability, to the maximum extent 
                practicable, of applicable respective recordkeeping and 
                reporting requirements for trade repositories.
    ``(e) Timing.--The Commission may by rule specify the date by which 
persons are required--
            ``(1) to submit transactions in standardized commodity-
        based swaps for clearing to a derivatives clearing organization 
        pursuant to subsection (c); and
            ``(2)(A) to submit transactions in commodity-based swaps 
        for clearing to a derivatives clearing organization; or
            ``(B) to report transactions in the commodity-based 
        derivative instruments to a registered trade repository 
        pursuant to subsection (d).
    ``(f) Collection, Consolidation, and Dissemination of Information 
on Transactions and Positions in Commodity-Based Swaps.--
            ``(1) Commission action required.--The Commission shall, 
        consistent with the public interest, the protection of market 
        participants, the maintenance of fair and orderly markets, and 
        the purposes of this section, use the authority of the 
        Commission under this Act to facilitate--
                    ``(A) the collection, consolidation, and 
                dissemination of information on transactions and 
                positions in commodity-based swaps; and
                    ``(B) the establishment of coordinated facilities 
                for the consolidation of information on transactions 
                and positions in commodity-based swaps.
            ``(2) Actions required by registered entities.--The 
        Commission, by rule, regulation, or order, may require each 
        derivatives clearing organization that clears transactions in 
        commodity-based swaps, and each registered trade repository 
        registered or applying to become registered, in such form and 
        frequency as the Commission shall prescribe as appropriate in 
        the public interest, for the protection of market participants, 
        or otherwise in furtherance of the purposes of this Act--
                    ``(A) to disseminate certain transaction or 
                position information concerning commodity-based swaps; 
                and
                    ``(B) to ensure the prompt, accurate, reliable, and 
                fair collection, processing, distribution, and 
                publication of information with respect to transactions 
                and positions, as appropriate, cleared by or reported 
                to the derivatives clearing organization or the 
                registered trade repository.
    ``(g) Records, Reports, and Examinations.--
            ``(1) In general.--Each registered trade repository shall 
        make and keep for prescribed periods such records, furnish such 
        copies of the records, and make and disseminate such reports as 
        the Commission, by rule, prescribes as appropriate in the 
        public interest, or otherwise in furtherance of the purposes of 
        this Act.
            ``(2) Examinations.--All records with regard to commodity-
        based swaps of a registered trade repository shall be subject 
        at any time to such reasonable periodic, special, or other 
        examinations by representatives of the Commission as the 
        Commission considers appropriate in the public interest, for 
        the protection of market participants, or otherwise in 
        furtherance of the purposes of this Act.''.
    (b) Derivatives Clearing Organizations.--Section 5b of the 
Commodity Exchange Act (7 U.S.C. 7a-1) is amended--
            (1) by striking subsections (a) and (b) and inserting the 
        following:
    ``(a) Registration Requirement.--It shall be unlawful for a 
derivatives clearing organization, unless registered with the 
Commission, directly or indirectly to make use of the mails or any 
means or instrumentality of interstate commerce to perform the 
functions of a derivatives clearing organization with respect to a 
contract of sale of a commodity for future delivery (or option on such 
a contract) or option on a commodity, or a commodity-based swap, in 
each case unless the contract, option, or commodity-based swap is not 
required to be cleared under this Act.
    ``(b) Voluntary Registration.--A derivatives clearing organization 
that clears agreements, contracts, or transactions that are not 
required to be cleared under this Act may register with the Commission 
as a derivatives clearing organization.''.
            (2) in subsection (c)--
                    (A) by striking paragraph (1) and inserting the 
                following:
            ``(1) Application.--A person desiring to register as a 
        derivatives clearing organization shall submit to the 
        Commission an application in such form and containing the rules 
        of the derivatives clearing organization and such other 
        information and documents as the Commission, by rule, may 
        prescribe as appropriate in the public interest or for the 
        purpose of making the determinations required for approval 
        under this section.'';
                    (B) in paragraph (2)--
                            (i) by striking subparagraph (B) and 
                        inserting the following:
                    ``(B) Financial resources.--The applicant shall 
                demonstrate that the applicant has adequate financial, 
                operational, and managerial resources to discharge the 
                responsibilities of a derivatives clearing organization 
                and to manage all associated risks.''; and
                            (ii) by adding at the end the following:
                    ``(O) Market participant access.--The applicant 
                shall establish appropriate standards to ensure open 
                and fair access to all persons that meet the ongoing 
                and continuing participant eligibility standards of the 
                organization with respect to commodity-based swaps and 
                to accept for clearing from the participants all 
                commodity-based swaps that meet the product eligibility 
                standards of the organization, regardless of where the 
                transactions are executed.''; and
                    (C) by adding at the end the following:
            ``(4) Commission procedures for granting registration to 
        derivatives clearing organizations for clearing commodity-based 
        swaps.--
                    ``(A) In general.--The Commission shall, on the 
                filing of an application for registration pursuant to 
                paragraph (2) for purposes of clearing commodity-based 
                swaps, publish notice of the filing and afford 
                interested persons an opportunity to submit written 
                data, views, and arguments concerning the application.
                    ``(B) Actions.--Not later than 90 days after the 
                date of the publication of the notice (or, with the 
                consent of the applicant, a longer period), the 
                Commission shall--
                            ``(i) by order grant the registration; or
                            ``(ii) institute proceedings to determine 
                        whether registration should be denied.
                    ``(C) Proceedings.--
                            ``(i) In general.--The proceedings 
                        described in subparagraph (B)(ii) shall--
                                    ``(I) include notice of the grounds 
                                for denial under consideration and 
                                opportunity for hearing; and
                                    ``(II) be concluded not later than 
                                180 days after the date of publication 
                                of notice of the filing of the 
                                application for registration.
                            ``(ii) Actions.--At the conclusion of the 
                        proceedings the Commission, by order, shall 
                        grant or deny the registration.
                            ``(iii) Extensions.--The Commission may 
                        extend the time for the conclusion of the 
                        proceedings for--
                                    ``(I) not more than 60 days if the 
                                Commission--
                                            ``(aa) finds good cause for 
                                        the extension; and
                                            ``(bb) publishes the 
                                        reasons of the Commission for 
                                        the finding; or
                                    ``(II) with the consent of the 
                                applicant, a longer period.
                            ``(iv) Standard for registration.--
                                    ``(I) In general.--The Commission 
                                shall grant the registration of a 
                                derivatives clearing organization if 
                                the Commission finds that the 
                                derivatives clearing organization is so 
                                organized, and has the capacity, to be 
                                able--
                                            ``(aa) to ensure the 
                                        prompt, accurate, and reliable 
                                        performance of the functions of 
                                        a derivatives clearing 
                                        organization;
                                            ``(bb) to comply with this 
                                        Act (including rules and 
                                        regulations); and
                                            ``(cc) to carry out the 
                                        functions of a derivatives 
                                        clearing organization in a 
                                        manner consistent with the 
                                        purposes and core principles of 
                                        this section.
                                    ``(II) Denial.--The Commission 
                                shall deny the registration of a 
                                derivatives clearing organization if 
                                the Commission does not make a finding 
                                described in subclause (I).
            ``(5) Withdrawal of registration.--For purposes of clearing 
        commodity-based swaps, a derivatives clearing organization may, 
        on such terms and conditions as the Commission considers 
        appropriate in the public interest or for the protection of 
        market participants, withdraw from registration by filing a 
        written notice of withdrawal with the Commission.
            ``(6) Access to derivatives clearing organization to clear 
        commodity-based swaps.--
                    ``(A) Notice of prohibition or limitation.--
                            ``(i) In general.--For purposes of clearing 
                        commodity-based swaps, if any derivatives 
                        clearing organization prohibits or limits any 
                        person access to services offered, directly or 
                        indirectly, by the derivatives clearing 
                        organization, the derivatives clearing 
                        organization shall promptly file notice of the 
                        prohibition or denial with the Commission.
                            ``(ii) Contents.--The notice shall be in 
                        such form and contain such information as the 
                        Commission, by rule, may prescribe as 
                        appropriate in the public interest.
                    ``(B) Review by commission.--Any prohibition or 
                limitation on access to services with respect to which 
                a derivatives clearing organization is required by 
                subparagraph (A) to file notice shall be subject to 
                review by the Commission on--
                            ``(i) the motion of the Commission; or
                            ``(ii) application by any person aggrieved 
                        by the prohibition or limitation filed--
                                    ``(I) not later than 30 days after 
                                the date the notice described in 
                                subparagraph (A) has been filed with 
                                the Commission and received by the 
                                aggrieved person; or
                                    ``(II) within such longer period as 
                                the Commission may determine.
                    ``(C) Stays.--
                            ``(i) In general.--Application to the 
                        Commission for review, or the institution of 
                        review by the Commission on the motion of the 
                        Commission, shall not operate as a stay of the 
                        prohibition or limitation, unless the 
                        Commission otherwise orders, summarily or after 
                        notice and opportunity for hearing on the 
                        question of a stay.
                            ``(ii) Hearing.--A hearing under clause (i) 
                        may consist solely of the submission of 
                        affidavits or presentation of oral arguments.
                            ``(iii) Expedited procedure.--The 
                        Commission shall establish for appropriate 
                        cases an expedited procedure for consideration 
                        and determination of the question of a stay.
                    ``(D) Actions.--
                            ``(i) Dismissal of proceedings.--For 
                        purposes of clearing commodity-based swaps, in 
                        any proceeding to review the prohibition or 
                        limitation of any person in respect of access 
                        to services offered by a derivatives clearing 
                        organization, the Commission, by order, shall 
                        dismiss the proceeding if the Commission finds, 
                        after notice and opportunity for hearing, 
                        that--
                                    ``(I) the prohibition or limitation 
                                is consistent with this Act (including 
                                rules and regulations); and
                                    ``(II) the person has not been 
                                discriminated against unfairly.
                            ``(ii) Access to services.--If the 
                        Commission does not make a finding described in 
                        clause (i), or if the Commission finds that the 
                        prohibition or limitation imposes any burden on 
                        competition not appropriate in furtherance of 
                        the purposes of this Act, the Commission, by 
                        order, shall--
                                    ``(I) set aside the prohibition or 
                                limitation; and
                                    ``(II) require the registered trade 
                                repository to permit the person access 
                                to the services offered by the 
                                derivatives clearing organization to 
                                which the prohibition or limitation 
                                applied.
            ``(7) Administrative proceeding authority.--The Commission, 
        by order, may censure or place limitations on the activities, 
        functions, or operations of any derivatives clearing 
        organization that is clearing commodity-based swaps, or suspend 
        for a period not exceeding 12 months or revoke the registration 
        of any derivatives clearing organization, if the Commission 
        finds, on the record after notice and opportunity for hearing, 
        that--
                    ``(A) the censure, placing of limitations, 
                suspension, or revocation is appropriate in the public 
                interest and for the protection of market participants 
                or otherwise in furtherance of the purposes of this 
                Act; and
                    ``(B) the derivatives clearing organization has 
                violated or is unable to comply with any provision of 
                this Act (including rules or regulations).
            ``(8) Rulemaking authorization.--For purposes of clearing 
        commodity-based swaps, no derivatives clearing organization 
        shall, directly or indirectly, engage in any activity as a 
        derivatives clearing organization in contravention of such 
        rules and regulations as the Commission may prescribe--
                    ``(A) as appropriate in the public interest;
                    ``(B) for the protection of market participants; or
                    ``(C) otherwise in furtherance of the purposes of 
                this Act.
            ``(9) Records, reports, and examinations.--
                    ``(A) In general.--Each derivatives clearing 
                organization shall, for purposes of clearing commodity-
                based swaps, make and keep for prescribed periods such 
                records, furnish such copies of the records, and make 
                and disseminate such reports as the Commission, by 
                rule, prescribes as appropriate in the public interest, 
                or otherwise in furtherance of the purposes of this 
                Act.
                    ``(B) Examinations.--For purposes of clearing 
                commodity-based derivative instruments, all records of 
                a derivatives clearing organization shall be subject at 
                any time to such reasonable periodic, special, or other 
                examinations by representatives of the Commission as 
                the Commission considers appropriate in the public 
                interest, for the protection of market participants, or 
                otherwise in furtherance of the purposes of this 
                Act.''.

SEC. 204. PRUDENTIAL SUPERVISION AND REGULATION OF SIGNIFICANT 
              COMMODITY-BASED DERIVATIVES MARKET PARTICIPANTS AND 
              INCENTIVES FOR TRADING ON REGULATED EXCHANGES.

    The Commodity Exchange Act (7 U.S.C. 1 et seq.) is amended by 
inserting after section 4r (as added by section 203(a)) the following:

``SEC. 4S. REGULATION OF SIGNIFICANT COMMODITY-BASED DERIVATIVES MARKET 
              PARTICIPANTS.

    ``(a) Definition of Appropriate Regulatory Authority.--In this 
section, the term `appropriate regulatory authority' means--
            ``(1) the appropriate Federal banking agency (as defined in 
        section 1813(q) of title 12, United States Code), with respect 
        to a significant commodity-based derivatives market participant 
        that is an insured depository institution (as defined in 
        section 1813(c) of title 12, United States Code), but not an 
        affiliate of an insured depository institution;
            ``(2) the Federal Housing Finance Agency, with respect to a 
        significant commodity-based derivatives market participant that 
        is a regulated entity (as defined in section 4502 of title 12, 
        United States Code);
            ``(3) the Commission, with respect to a significant 
        commodity-based derivatives market participant that is--
                    ``(A) a futures commission merchant or an 
                introducing broker, other than a futures commission 
                merchant or an introducing broker registered pursuant 
                to section 4f(a) or an affiliate of an insured 
                depository institution; or
                    ``(B) a commodity pool operator or commodity 
                trading advisor, other than an affiliate of an insured 
                depository institution; and
            ``(4) the Securities and Exchange Commission, with respect 
        to a significant commodity-based derivatives market 
        participant--
                    ``(A) that is a broker or dealer, as those terms 
                are defined in section 3(a) of the Securities Exchange 
                Act of 1934 (15 U.S.C. 78c(a)) (other than a broker or 
                dealer registered under section 15(b)(11) of that Act 
                (15 U.S.C. 78o(b)(11)) that is not an affiliate of an 
                insured depository institution); or
                    ``(B) for which there is not another appropriate 
                regulatory authority otherwise specified in this 
                subsection.
    ``(b) Registration by Significant Commodity-Based Derivatives 
Market Participants.--It shall be unlawful for any significant 
commodity-based derivatives market participant to make use of the mails 
or any means or instrumentality of interstate commerce to effect any 
transactions in, or to induce or attempt to induce a transaction in, 
any commodity-based swap unless the significant commodity-based 
derivatives market participant has registered in accordance with 
subsection (c).
    ``(c) Manner of Registration of Significant Commodity-Based 
Derivatives Market Participants.--
            ``(1) In general.--A significant commodity-based 
        derivatives market participant subject to the registration 
        requirement of subsection (b) may register by filing with the 
        Commission an application for registration in such form and 
        containing such information and documents concerning the 
        significant commodity-based derivatives market participant and 
        any persons associated with the significant commodity-based 
        derivatives market participant as the Commission, by rule, 
        regulation, or order, may prescribe as appropriate in the 
        public interest or for the protection of market participants.
            ``(2) Action by the commission.--
                    ``(A) In general.--Not later than 45 days after the 
                date of filing of an application under paragraph (1) 
                (or, with the consent of the applicant, a longer 
                period), the Commission shall--
                            ``(i) by order grant registration; or
                            ``(ii) institute proceedings in accordance 
                        with subparagraph (B) to determine whether the 
                        registration should be denied.
                    ``(B) Proceedings.--
                            ``(i) In general.--Proceedings initiated 
                        under subparagraph (B)(ii) shall include notice 
                        of the grounds for denial under consideration 
                        and opportunity for hearing.
                            ``(ii) Conclusion.--Not later than 120 days 
                        after the date of the filing of the application 
                        for registration, the Commission shall conclude 
                        the proceedings and, by order, grant or deny 
                        the registration.
                            ``(iii) Extension.--The Commission may 
                        extend the time for the conclusion of a 
                        proceedings for up to 90 days (or, with the 
                        consent of the applicant, a longer period) if 
                        the Commission finds good cause for the 
                        extension and publishes the reasons for the 
                        extension.
                    ``(C) Basis for determination.--
                            ``(i) In general.--The Commission shall 
                        grant the registration of a significant 
                        commodity-based derivatives market participant 
                        if the Commission finds that the requirements 
                        of this section are satisfied.
                            ``(ii) Denial.--The Commission shall deny 
                        the registration if the Commission does not 
                        make a finding under clause (i) or if the 
                        Commission finds that if the applicant were 
                        registered, the registration of the applicant 
                        would be subject to suspension or revocation 
                        under subsection (f).
            ``(3) Withdrawal.--Any person that has filed an application 
        pursuant to paragraph (1) may, on such terms and conditions as 
        the Commission determines appropriate in the public interest, 
        for the protection of market participants, or otherwise in 
        furtherance of the purposes of this Act, withdraw the 
        application by filing a written withdrawal with the Commission.
    ``(d) Business Conduct Requirements.--
            ``(1) Definition of regulated person.--In this subsection, 
        the term `regulated person' means--
                    ``(A) a significant commodity-based derivatives 
                market participant; and
                    ``(B) any other class of persons that the 
                Commission may determine by rule, regulation, or order 
                to be subject to this subsection.
            ``(2) Prohibition.--It shall be unlawful for any regulated 
        person to make use of the mails or any means or instrumentality 
        of interstate commerce to effect any transaction in, or to 
        induce or attempt to induce a transaction in, any commodity-
        based swap, unless the regulated person complies with such 
        business conduct requirements as the Commission and the 
        Securities and Exchange Commission, in consultation with the 
        appropriate regulatory authorities, may jointly prescribe by 
        rule, regulation, or order, as appropriate in the public 
        interest, for the protection of market participants, and 
        otherwise in furtherance of the purposes of this Act.
            ``(3) Requirements.--Business conduct requirements 
        prescribed under this subsection shall--
                    ``(A) establish the standard of care required for a 
                regulated person to verify that any counterparty meets 
                the eligibility standards for an eligible contract 
                participant or qualified institutional buyer (as 
                defined in section 3(a) of the Securities Exchange Act 
                of 1934 (15 U.S.C. 78c(a)));
                    ``(B) require disclosure by the regulated person to 
                any counterparty to the transaction of--
                            ``(i) material product-specific information 
                        about the risks and characteristics of the 
                        commodity-based swap;
                            ``(ii) the source and amount of any fees or 
                        other material remuneration that the regulated 
                        person would directly or indirectly expect to 
                        receive in connection with the commodity-based 
                        swap; and
                            ``(iii) any other material incentives or 
                        conflicts of interest that the regulated person 
                        may have in connection with the commodity-based 
                        swap;
                    ``(C) establish a minimum standard of conduct for a 
                regulated person with respect to any counterparty, 
                other than a qualified institutional buyer (as defined 
                in section 3(a) of the Securities Exchange Act of 1934 
                (15 U.S.C. 78c(a))), for--
                            ``(i) providing disclosure of the general 
                        risks and characteristics of any commodity-
                        based swap;
                            ``(ii) communicating in a fair and balanced 
                        manner based on principles of fair dealing and 
                        good faith;
                            ``(iii) assessing the appropriateness of 
                        any commodity-based swap for the counterparty, 
                        except that in the case of a counterparty that 
                        is an eligible contract participant specified 
                        in clause (iv), the regulated person may rely 
                        on the representations described in clause 
                        (iv)(VI) that the transaction is appropriate 
                        for the counterparty; and
                            ``(iv) with respect to a counterparty that 
                        is an eligible contract participant (within the 
                        meaning of subclause (I) or (II) of section 
                        1a(15)(A)(vii)), having a reasonable basis to 
                        believe that the counterparty has an 
                        independent representative that--
                                    ``(I) has sufficient knowledge to 
                                evaluate the transaction and risks;
                                    ``(II) is not subject to a 
                                statutory disqualification;
                                    ``(III) is independent of the 
                                regulated person;
                                    ``(IV) undertakes a duty to act in 
                                the best interests of the counterparty 
                                that the independent representative 
                                represents;
                                    ``(V) makes appropriate 
                                disclosures; and
                                    ``(VI) will provide written 
                                representations to the eligible 
                                contract participant regarding fair 
                                pricing and the appropriateness of the 
                                transaction;
                    ``(D) require the availability of information about 
                any commodity referenced in a commodity-based swap or 
                on which the commodity-based swap is based; and
                    ``(E) establish such other standards and 
                requirements as the Commission, acting jointly with the 
                Securities and Exchange Commission and in consultation 
                with the appropriate regulatory authorities, may 
                determine are appropriate in the public interest, for 
                the protection of market participants, or otherwise in 
                furtherance of the purposes of this Act.
    ``(e) Statutory Disqualification.--Except to the extent otherwise 
specifically provided by rule, regulation, or order of the Commission, 
it shall be unlawful for a significant commodity-based derivatives 
market participant to permit any associated person of the significant 
commodity-based derivatives market participant who is subject to a 
statutory disqualification to effect or be involved in effecting 
transactions in commodity-based swaps on behalf of the significant 
commodity-based derivatives market participant, if the significant 
commodity-based derivatives market participant knew, or in the exercise 
of reasonable care should have known, of the statutory 
disqualification.
    ``(f) Administrative Proceeding Authority.--
            ``(1) In general.--The Commission, by order, shall censure, 
        place limitations on the activities, functions, or operations 
        of, or reject the filing of any significant commodity-based 
        derivatives market participant that has registered with the 
        Commission pursuant to subsection (d) if the Commission finds, 
        on the record after notice and opportunity for hearing, that--
                    ``(A) the censure, placing of limitations, or 
                rejection is in the public interest; and
                    ``(B) the significant commodity-based derivatives 
                market participant, or any person associated with the 
                significant commodity-based derivatives market 
                participant effecting or involved in effecting 
                transactions in commodity-based swaps on behalf of the 
                significant commodity-based derivatives market 
                participant, whether prior or subsequent to becoming so 
                associated, has committed or omitted any act, or is 
                subject to an order or finding, described in paragraphs 
                (2) and (3) of section 8a.
            ``(2) Associated persons.--With respect to any person who 
        is associated, who is seeking to become associated, or who, at 
        the time of the alleged misconduct, was associated or was 
        seeking to become associated with a significant commodity-based 
        derivatives market participant for the purpose of effecting or 
        being involved in effecting commodity-based swaps on behalf of 
        the significant commodity-based derivatives market participant, 
        the Commission, by order, shall censure, place limitations on 
        the activities or functions of the person, or suspend for a 
        period not exceeding 12 months, or bar the person from being 
        associated with a significant commodity-based derivatives 
        market participant, if the Commission finds, on the record 
        after notice and opportunity for a hearing, that--
                    ``(A) the censure, placing of limitations, 
                suspension, or bar is in the public interest; and
                    ``(B) the person has committed or omitted any act, 
                or is subject to an order or finding, described in 
                paragraphs (2) and (3) of section 8a.
            ``(3) Prohibition.--It shall be unlawful--
                    ``(A) for any person with respect to whom an order 
                under paragraph (2) is in effect, without the consent 
                of the Commission, willfully to become, or to be, 
                associated with a significant commodity-based 
                derivatives market participant in contravention of the 
                order; or
                    ``(B) for any significant commodity-based 
                derivatives market participant to permit a person 
                described in subparagraph (A), without the consent of 
                the Commission, to become or remain, a person 
                associated with the significant commodity-based 
                derivatives market participant in contravention of an 
                order under paragraph (2), if the significant 
                commodity-based derivatives market participant knew, or 
                in the exercise of reasonable care should have known, 
                of the order.
    ``(g) Capital and Margin Requirements.--
            ``(1) In general.--It shall be unlawful for any person to 
        conduct business as a significant commodity-based derivatives 
        market participant unless the person meets at all times such 
        minimum capital and margin requirements as the appropriate 
        regulatory authorities shall jointly prescribe, not later than 
        180 days after the enactment of this section, by rule or 
        regulation as appropriate in the public interest or for the 
        maintenance of fair and orderly markets and consistent with the 
        purposes of this Act to provide safeguards with respect to the 
        financial responsibility and related practices of the 
        significant commodity-based derivatives market participant.
            ``(2) Capital requirements.--In setting capital 
        requirements for significant commodity-based derivatives market 
        participants, the appropriate regulatory authorities shall 
        consider among other things--
                    ``(A) the liquidity of each commodity-based swap, 
                including whether the commodity-based swap--
                            ``(i) is traded on a liquid market; and
                            ``(ii) is centrally cleared; and
                    ``(B) whether the commodity-based swap is used to 
                offset or hedge another instrument or asset owned by 
                such significant commodity-based derivatives market 
                participant.
            ``(3) Margin requirements.--The appropriate regulatory 
        authorities shall jointly prescribe margin requirements, which 
        may permit the use of noncash collateral, that apply to 
        commodity-based swaps entered into by a significant commodity-
        based derivatives market participant, as the appropriate 
        regulatory authorities jointly determine to be appropriate for 
        the purpose of, at a minimum--
                    ``(A) preserving the financial integrity of markets 
                trading commodity-based swaps; and
                    ``(B) preventing systemic risk.
            ``(4) Commission rules.--Nothing in this Act prevents the 
        Commission from prescribing capital and margin requirements 
        that are higher or more restrictive than the joint rules 
        adopted under this subsection for significant commodity-based 
        derivatives market participants for which the Commission is the 
        appropriate regulatory authority.
    ``(h) Enforcement Authority.--Each appropriate regulatory authority 
shall have sole authority to enforce compliance with the rules adopted 
under subsection (g) in the case of each significant derivatives market 
participant for which the regulatory authority is the appropriate 
regulatory authority, as defined in subsection (a).''.

SEC. 205. RECORDKEEPING AND REPORTING REQUIREMENTS FOR DERIVATIVES 
              MARKET PARTICIPANTS.

    (a) In General.--Section 4g of the Commodity Exchange Act (7 U.S.C. 
6g) is amended by striking ``sec. 4g.'' and all that follows through 
the end of subsection (a) and inserting the following:

``SEC. 4G. RECORDKEEPING AND REPORTING REQUIREMENTS FOR COMMODITY-BASED 
              DERIVATIVES MARKET PARTICIPANTS.

    ``(a) In General.--Each person registered under this Act as a 
futures commission merchant, introducing broker, floor broker, floor 
trader, or significant commodity-based derivatives market participant 
(or any other person that engages in transactions in commodity-based 
swaps as the Commission, by rule, regulation or order, designates) 
shall--
            ``(1) make such reports as are required by the Commission 
        regarding the transactions and positions of the person, and the 
        transactions and positions of the customers of the person, in 
        commodities for future delivery on any board of trade in the 
        United States or elsewhere, in any significant price discovery 
        contract traded or executed on an electronic trading facility, 
        in any agreement, contract, or transaction that is treated by a 
        derivatives clearing organization, whether registered or not 
        registered, as fungible with a significant price discovery 
        contract, and in any commodity-based swap;
            ``(2) keep books and records pertaining to those 
        transactions and positions in such form and manner and for such 
        period as may be required by the Commission; and
            ``(3) make those books and records available for inspection 
        by any representative of the Commission or the Department of 
        Justice.''.
    (b) Daily Trading Record.--Section 4g of the Commodity Exchange Act 
(7 U.S.C. 6g) is amended--
            (1) by striking subsections (c) and (d) and inserting the 
        following:
    ``(c) Daily Trading Records.--
            ``(1) In general.--Each floor broker, introducing broker, 
        futures commission merchant, significant commodity-based 
        derivatives market participant, and any other person designated 
        by the Commission pursuant to subsection (a) shall maintain 
        daily trading records for each customer in such manner and form 
        as to be identifiable with the trades referred to in subsection 
        (b).
            ``(2) Form and reports.--
                    ``(A) In general.--Daily trading records shall be 
                maintained in a form suitable to the Commission for 
                such period as may be required by the Commission.
                    ``(B) Reports.--Reports shall be made from the 
                records maintained at such time, in such manner, and at 
                such places as the Commission may prescribe by rule, 
                order, or regulation in order to protect the public 
                interest and the interest of persons trading in 
                commodity futures or commodity-based swaps.''; and
            (2) by redesignating subsections (e) and (f) as subsections 
        (d) and (e), respectively.

SEC. 206. PROHIBITION OF MARKET MANIPULATION, FRAUD, AND OTHER MARKET 
              ABUSES.

    (a) Position Limits.--
            (1) In general.--Section 4a(a) of the Commodity Exchange 
        Act (7 U.S.C. 6a(a)) is amended--
                    (A) by striking ``sec. 4a. (a) Excessive'' and 
                inserting the following:

``SEC. 4A. EXCESSIVE SPECULATION AS BURDEN ON INTERSTATE COMMERCE.

    ``(a) Excessive Speculation.--
            ``(1) In general.--Excessive'';
                    (B) by designating the first through sixth 
                sentences as paragraphs (1) through (6), respectively;
                    (C) in paragraph (1) (as so designated), by 
                striking ``on electronic trading facilities with 
                respect to a significant price discovery contract'' and 
                inserting ``commodity-based swaps that perform or 
                affect a significant price discovery function'';
                    (D) in paragraph (2) (as so designated)--
                            (i) by inserting ``, including any group or 
                        class of traders,'' after ``held by any 
                        person''; and
                            (ii) by striking ``on an electronic trading 
                        facility with respect to a significant price 
                        discovery contract,'' and inserting 
                        ``commodity-based swaps that perform or affect 
                        a significant price discovery function,''; and
                    (E) by adding at the end the following:
            ``(7) Aggregate position limits and position reporting for 
        commodity-based swaps.--The Commission may, by rule or 
        regulation, establish limits (including related hedge exemption 
        provisions) on, or otherwise prescribe requirements regarding, 
        the aggregate number of positions in commodity-based swaps 
        based on the same underlying commodity that may be held by any 
        person, including any group or class of traders, for each month 
        across--
                    ``(A) contracts listed by designated contract 
                markets;
                    ``(B) contracts traded on a foreign board of trade; 
                and
                    ``(C) commodity-based swaps that perform or affect 
                a significant price discovery function.
            ``(8) Considerations.--In making a determination whether a 
        commodity-based swap performs or affects a significant price 
        discovery function, the Commission shall consider the extent to 
        which the commodity-based swap has a significant price linkage, 
        price discovery relationship, or other significant price 
        relationship with 1 or more contracts listed by designated 
        contract markets.
            ``(9) Reports.--The Commission may, by rule or regulation, 
        require any person that effects transactions for the account of 
        the person or the account of others in any commodity-based swap 
        to report such information as the Commission may prescribe 
        regarding any position or positions in the commodity-based 
        swaps.
            ``(10) Exemptions.--The Commission, by rule or regulation, 
        may conditionally or unconditionally exempt any person or class 
        of persons, any commodity-based swap or class of commodity-
        based swaps, or any transaction or class of transactions from 
        any requirement the Commission establishes under this section 
        with respect to position limits for commodity-based swaps.''.
            (2) Conforming amendments.--Section 4a(b) of the Commodity 
        Exchange Act (7 U.S.C. 6a(b)) is amended--
                    (A) in paragraph (1), by striking ``or electronic 
                trading facility'' and inserting ``or 1 or more 
                regulated electronic transparent trade execution 
                systems''; and
                    (B) in paragraph (2), by striking ``or electronic 
                trading facility'' and inserting ``or regulated 
                electronic transparent trade execution system''.
    (b) Prohibitions.--Section 4b of the Commodity Exchange Act (7 
U.S.C. 6b) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (1), by striking ``or'' after the 
                semicolon at the end;
                    (B) in paragraph (2)(D)(ii), by striking the period 
                at the end and inserting ``; or''; and
                    (C) by adding at the end the following:
            ``(3) for any person, directly or indirectly, by the use of 
        any means or instrumentality of interstate commerce or of the 
        mails, to effect any transaction in, or to induce or attempt to 
        induce a transaction in, any commodity-based swap, in 
        connection with which the person--
                    ``(A) engages in any fraudulent, deceptive, or 
                manipulative act or practice;
                    ``(B) makes any fictitious quotation; or
                    ``(C) engages in any transaction, practice, or 
                course of business that operates as a fraud or deceit 
                on any person.''; and
            (2) in subsection (b)--
                    (A) by striking ``Subsection (a)(2) of this 
                section'' and inserting the following:
            ``(1) In general.--Subsection (a)(2)''; and
                    (B) by adding at the end the following:
            ``(2) Commodity-based swaps.--
                    ``(A) In general.--For the purposes of subsection 
                (a)(3), the Commission shall, by rule, regulation, or 
                order, define and prescribe means reasonably designed 
                to prevent--
                            ``(i) such transactions, acts, practices, 
                        and courses of business as are fraudulent, 
                        deceptive, or manipulative; and
                            ``(ii) such quotations as are fictitious.
                    ``(B) Requirements.--In adopting rules, 
                regulations, or orders under subparagraph (A), the 
                Commission shall--
                            ``(i) consult with the Securities and 
                        Exchange Commission; and
                            ``(ii) seek to maintain comparability of 
                        the rules, regulations, or orders with similar 
                        rules of the Securities and Exchange 
                        Commission.''.

SEC. 207. PROTECTIONS FOR MARKETING COMMODITY-BASED SWAPS TO CERTAIN 
              PERSONS.

    (a) Definition of Eligible Contract Participant.--Paragraph (15) of 
section 1a of the Commodity Exchange Act (7 U.S.C. 1a) (as redesignated 
by section 201(2)) is amended--
            (1) in subparagraph (A)--
                    (A) in clause (i), by inserting ``(as defined in 
                paragraph (18) as in effect on the date of enactment of 
                the Comprehensive Derivatives Regulation Act of 2009)'' 
                after ``financial institution'';
                    (B) in clause (iv)(I), by striking ``total assets'' 
                and inserting ``total net assets'';
                    (C) in clause (v)--
                            (i) in subclause (I), by striking ``total 
                        assets exceeding $10,000,000'' and inserting 
                        ``total net assets exceeding $10,000,000; or'';
                            (ii) by striking subclause (II);
                            (iii) by redesignating subclause (III) as 
                        subclause (II); and
                            (iv) in item (aa) of subclause (II) (as so 
                        designated), by striking ``a net worth 
                        exceeding $1,000,000'' and inserting ``total 
                        net assets exceeding $5,000,000'';
                    (D) in clause (vii), by striking subclause (III) 
                and the undesignated matter following that subclause 
                and inserting the following:
                                    ``(III) an instrumentality, agency, 
                                or department of an entity described in 
                                subclause (I) or (II);
                                except that the term does not include 
                                an entity, political subdivision, 
                                instrumentality, agency, or department 
                                described in subclause (I) or (III) 
                                unless the entity, political 
                                subdivision, instrumentality, agency, 
                                or department owns and invests on a 
                                discretionary basis $50,000,000 or more 
                                in investments, except that, with 
                                respect to any State or entity, 
                                political subdivision, agency or 
                                department of a State, that amount is 
                                exclusive of any proceeds from any 
                                offering of municipal securities;''; 
                                and
                    (E) by striking clause (xi) and inserting the 
                following:
                            ``(xi) an individual who--
                                    ``(I) owns and invests on a 
                                discretionary basis not less than 
                                $10,000,000;
                                    ``(II) owns and invests on a 
                                discretionary basis not less than 
                                $5,000,000 and who enters into the 
                                agreement, contract, or transaction in 
                                order to manage the risk associated 
                                with an asset owned or liability 
                                incurred, or reasonably likely to be 
                                owned or incurred, by the individual; 
                                or
                                    ``(III) is an officer or director 
                                of an entity (or a person performing 
                                similar functions) and who enters into 
                                the agreement, contract, or transaction 
                                in order to manage the risk associated 
                                with the securities of the entity owned 
                                by the individual at the time of 
                                entering into the agreement, contract, 
                                or transaction;''; and
            (2) in subparagraph (C), by inserting ``by rule, jointly 
        with the Securities and Exchange Commission,'' after 
        ``determines''.
    (b) Limitation on Participation in Commodity-Based Swaps.--Section 
2 of the Commodity Exchange Act (7 U.S.C. 2) (as amended by section 
202(a)(2)(A)) is amended by adding at the end the following:
    ``(f) Limitation on Participation in Commodity-Based Swaps.--It 
shall be unlawful for any person, other than an eligible contract 
participant, to enter into a commodity-based swap.''.

SEC. 208. COMMODITY-BASED SWAP EXECUTION FACILITIES.

    The Commodity Exchange Act is amended by inserting after section 5g 
(7 U.S.C. 7b-2) the following:

``SEC. 5H. COMMODITY-BASED SWAP EXECUTION FACILITIES.

    ``(a) Registration.--No person may operate a trading facility for 
commodity-based swaps, unless the trading facility is registered as a 
commodity-based swap execution facility under this section.
    ``(b) Criteria for Registration.--
            ``(1) In general.--To be registered as a commodity-based 
        swap execution facility, a facility shall demonstrate to the 
        Commission that the facility meets the criteria specified in 
        this section.
            ``(2) Trading and participation rules.--The commodity-based 
        swap execution facility shall--
                    ``(A) establish and enforce trading and 
                participation rules that will deter abuses; and
                    ``(B) have the capacity to detect, investigate, and 
                enforce the rules, including the capacity--
                            ``(i) to obtain information necessary to 
                        perform the functions required under this 
                        section;
                            ``(ii) to provide market participants with 
                        impartial access to the market; and
                            ``(iii) to obtain information that may be 
                        used in establishing whether rule violations 
                        have occurred.
            ``(3) Trading procedures.--The commodity-based swap 
        execution facility shall establish and enforce rules or terms 
        and conditions defining, or specifications detailing, trading 
        procedures to be used in entering and executing orders for 
        commodity-based swaps on the facilities of the commodity-based 
        swap execution facility.
            ``(4) Financial integrity.--The commodity-based swap 
        execution facility shall establish and enforce rules and 
        procedures to ensure the financial integrity of commodity-based 
        swaps entered on or through the facilities of the commodity-
        based swap execution facility, including the clearance and 
        settlement of commodity-based swaps pursuant to section 2(f).
    ``(c) Principles for Commodity-Based Swap Execution Facilities.--
            ``(1) Compliance.--
                    ``(A) In general.--To maintain registration as a 
                commodity-based swap execution facility, the facility 
                shall comply with the principles specified in this 
                subsection.
                    ``(B) Discretion.--Except in cases in which the 
                Commission adopts rules or regulations pursuant to 
                section 8a(5), the commodity-based swap execution 
                facility shall have reasonable discretion in 
                establishing the manner in which the facility complies 
                with this subsection.
            ``(2) Rules.--The commodity-based swap execution facility 
        shall monitor and enforce compliance with any of the rules of 
        the facility, including--
                    ``(A) the terms and conditions of the commodity-
                based swaps traded on or through the facility; and
                    ``(B) any limitations on access to the facility.
            ``(3) Prevention of manipulation.--
                    ``(A) In general.--The commodity-based swap 
                execution facility shall permit trading only in 
                commodity-based swaps that are not readily susceptible 
                to manipulation.
                    ``(B) Monitoring.--The commodity-based swap 
                execution facility shall monitor trading in commodity-
                based swaps to prevent price manipulation, price 
                distortion through surveillance, compliance, and 
                disciplinary practices and procedures, including 
                methods for conducting real-time monitoring of trading 
                and comprehensive and accurate trade reconstructions.
            ``(4) Position limitations and accountability.--
                    ``(A) In general.--To reduce the potential threat 
                of market manipulation or congestion, and to eliminate 
                or prevent excessive speculation (as described in 
                section 4a(a)), the commodity-based swap execution 
                facility shall adopt for each of the contracts of the 
                facility, as appropriate, position limitations or 
                position accountability for speculators.
                    ``(B) Limitation level.--For any contract that is 
                subject to a position limitation established by the 
                Commission pursuant to section 4a(a), the commodity-
                based derivative execution facility shall set the 
                position limitations of the facility at a level that is 
                not higher than the Commission limitation.
            ``(5) Information sharing.--The commodity-based swap 
        execution facility shall--
                    ``(A) establish and enforce rules that will allow 
                the facility to obtain any necessary information to 
                perform any of the functions described in this 
                subsection;
                    ``(B) provide the information to the Commission on 
                request; and
                    ``(C) have the capacity to carry out such 
                international information-sharing agreements as the 
                Commission may require.
            ``(6) Accessibility.--The commodity-based swap trade 
        execution facility shall make public timely information on 
        price, trading volume, and other trading data to the extent 
        appropriate for commodity-based swaps.
            ``(7) Maintenance of records.--The commodity-based 
        derivative instrument execution facility shall--
                    ``(A) maintain records of all activities related to 
                the business of the facility, including a complete 
                audit trail, in a form and manner acceptable to the 
                Commission for a period of at least 5 years; and
                    ``(B) submit to the Commission such reports as the 
                Committee may require, at such time, in such manner, 
                and containing such information as is determined by the 
                Commission to be necessary for the Commission to 
                perform the responsibilities of the Commission.
            ``(8) Emergency authority.--The commodity-based swap 
        execution facility shall adopt rules to provide for the 
        exercise of emergency authority, in consultation or cooperation 
        with the Commission, as appropriate, including the authority to 
        suspend or curtail trading in a commodity-based swap.
            ``(9) Conflicts of interest.--The commodity-based 
        derivative instrument execution facility shall--
                    ``(A) establish and enforce rules to minimize 
                conflicts of interest in the decisionmaking process of 
                the facility; and
                    ``(B) establish a process for resolving the 
                conflicts of interest.
    ``(d) Trading by Contract Markets.--A board of trade that operates 
a contract market shall, to the extent that the board of trade also 
operates a commodity-based swap execution facility and uses the same 
electronic trade execution system for trading on the contract market 
and the commodity-based swap execution facility, identify whether the 
electronic trading is taking place on the contract market or the 
commodity-based swap execution facility.''.

SEC. 209. ENFORCEMENT.

    Section 6c of the Commodity Exchange Act (7 U.S.C. 13a-1) (as 
amended by section 202(b)(1)(I)) is amended by adding at the end the 
following:
    ``(h) Enforcement of Provisions Applicable to Derivatives Market 
Participants.--
            ``(1) Definition of applicable provision.--In this 
        subsection, the term `applicable provision' means any of 
        section 4a(a), subsections (a), (c), and (d) of section 4g, 
        sections 4r and 4s, and subsections (a) through (c)(1), (2), 
        and (4) of section 5b.
            ``(2) Enforcement by other agencies.--In addition to 
        enforcement by the Commission under this Act of compliance with 
        applicable provisions, to the extent applicable to commodity-
        based swaps, such compliance shall be enforced under--
                    ``(A) section 8 of the Federal Deposit Insurance 
                Act (12 U.S.C. 1818), by the appropriate Federal 
                banking agency, in the case of an insured depository 
                institution, as those terms are defined in section 3 of 
                that Act (12 U.S.C. 1813), but not an affiliate of such 
                an insured depository institution;
                    ``(B) the securities laws, as defined in section 
                3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
                78c(a)), by the Securities and Exchange Commission, in 
                the case of--
                            ``(i) a broker or dealer, as defined in 
                        section 3(a) of the Securities Exchange Act of 
                        1934 (15 U.S.C. 78c(a)) (other than a broker or 
                        dealer registered under section 15(b)(11) of 
                        that Act (15 U.S.C. 78o(b)(11)) that is not an 
                        affiliate of an insured depository institution, 
                        as defined in section 3 of the Federal Deposit 
                        Insurance Act (12 U.S.C. 1813));
                            ``(ii) an investment adviser, as defined in 
                        section 202(a) of the Investment Advisers Act 
                        of 1940 (15 U.S.C. 80b-2(a));
                            ``(iii) an investment company, as defined 
                        in section 3 of the Investment Company Act of 
                        1940 (15 U.S.C. 80a-3);
                            ``(iv) any other entity for which the 
                        Securities and Exchange Commission is a primary 
                        regulator;
                            ``(v) any affiliate of an insured 
                        depository institution; or
                            ``(vi) any other person that is not--
                                    ``(I) a futures commission merchant 
                                or an introducing broker (except a 
                                futures commission merchant or an 
                                introducing broker registered pursuant 
                                to section 4f(a) of this Act or an 
                                affiliate of an insured depository 
                                institution);
                                    ``(II) a commodity pool operator or 
                                commodity trading advisor (except an 
                                affiliate of an insured depository 
                                institution); or
                                    ``(III) a person specified in 
                                subparagraph (A) or (C); and
                    ``(C) the Federal Housing Enterprises Financial 
                Safety and Soundness Act of 1992 (12 U.S.C. 4501 et 
                seq.), by the Federal Housing Finance Agency, in the 
                case of a regulated entity, as defined in section 1303 
                of the Federal Housing Enterprises Financial Safety and 
                Soundness Act of 1992 (12 U.S.C. 4502).
            ``(3) Violations treated as violations of other laws.--
                    ``(A) In general.--For purposes of the exercise by 
                any agency referred to in paragraph (2) of the powers 
                of the agency under any provision of law referred to in 
                that paragraph, a violation of any applicable 
                provision, as the provision applies to commodity-based 
                swaps, shall be considered to be a violation of a 
                requirement imposed under that provision of law.
                    ``(B) Additional authority.--In addition to its 
                powers under any provision of law specifically referred 
                to in paragraph (2), each of the agencies referred to 
                in that paragraph may exercise, for the purpose of 
                enforcing compliance with applicable provisions, as the 
                applicable provisions apply to commodity-based swaps, 
                any other authority conferred on the agency by law.''.

SEC. 210. ENFORCEABILITY OF COMMODITY-BASED SWAPS.

    Section 22(a) of the Commodity Exchange Act (7 U.S.C. 25(a)) is 
amended by striking paragraph (4) and inserting the following:
            ``(4) Contract enforcement between eligible 
        counterparties.--No agreement, contract, or transaction that is 
        a commodity-based swap shall be void, voidable, or 
        unenforceable by either party to the commodity-based swap, and 
        no party to the commodity-based swap shall be entitled to 
        rescind, or recover any payment made with respect to, the 
        commodity-based swap under this section or any other provision 
        of this Act based solely on the failure of either party to the 
        agreement, contract, or transaction to satisfy its respective 
        obligations under section 4a(a), subsections (a), (c), and (d) 
        of section 4g, sections 4r and 4s, and subsections (a) through 
        (c)(1), (2), and (4) of section 5b with respect to the 
        commodity-based swap.''.

                      TITLE III--OTHER PROVISIONS

SEC. 301. MARGINING AND OTHER RISK MANAGEMENT STANDARDS FOR CENTRAL 
              COUNTERPARTIES.

    (a) Agency Actions.--The Securities and Exchange Commission and the 
Commodity Futures Trading Commission shall each promulgate rules 
requiring each clearing agency (as defined in section 3(a)(23) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(23))) and derivatives 
clearing organization (as defined in section 1a(13) of the Commodity 
Exchange Act (7 U.S.C. 1a(13))) to have robust risk management 
controls, including risk margin collateral requirements, to assure the 
ability to meet their settlement obligations.
    (b) Consultation Required.--To assure regulation of risk management 
controls, the Securities and Exchange Commission and the Commodity 
Futures Trading Commission shall consult with each other and the Board 
of Governors of the Federal Reserve System, shall seek to maintain 
comparability of such rules, and shall give consideration to the 
recommendations of the Board of Governors of the Federal Reserve System 
before adopting rules under this section.

SEC. 302. DETERMINING THE STATUS OF SWAPS.

    (a) Process for Determining the Status of a Swap.--
            (1) Rulemaking.--The Securities and Exchange Commission and 
        the Commodity Futures Trading Commission shall jointly issue 
        rules establishing a process for resolving any disagreement 
        between the agencies regarding the status of a derivative as a 
        security-based swap, a commodity-based swap, a security 
        derivative, or a commodity derivative.
            (2) Content.--The rules adopted under this section shall--
                    (A) include a method for determining the status of 
                a derivative as a security-based swap, a commodity-
                based swap, a security derivative, or a commodity 
                derivative within 90 days after the date of the 
                commencement of the determination process; and
                    (B) require the agencies to consider, in making 
                such determination, the nature of the derivative, the 
                extent to which the derivative is economically similar 
                to instruments that are subject to regulation by the 
                Securities and Exchange Commission or the Commodity 
                Futures Trading Commission, the appropriateness of 
                regulation of the derivative under either the 
                securities laws or the Commodity Exchange Act, and such 
                other factors as the Securities and Exchange Commission 
                and the Commodity Futures Trading Commission may 
                prescribe.
    (b) Judicial Resolution.--
            (1) In general.--If the Securities and Exchange Commission 
        and the Commodity Futures Trading Commission are unable to 
        determine the status of a derivative as a security-based swap, 
        a commodity-based swap, a security derivative, or a commodity 
        derivative pursuant to the process established in subsection 
        (a), either agency may petition the United States Court of 
        Appeals for the District of Columbia Circuit for a 
        determination of the status of the derivative as a security-
        based swap, a commodity-based swap, a security derivative, or a 
        commodity derivative.
            (2) Expedited review.--The United States Court of Appeals 
        for the District of Columbia Circuit shall complete all action 
        on a petition filed in accordance with paragraph (1), including 
        rendering a final determination of the status of the derivative 
        as a security-based swap, a commodity-based swap, a security 
        derivative, or a commodity derivative before the end of the 60-
        day period beginning on the date on which such petition is 
        filed, unless all parties to such proceeding agree to any 
        extension of such period.
            (3) Standard of review.--The court shall determine the 
        status of a new derivative instrument as either a security-
        based derivative, a security-based swap, a commodity-based 
        swap, a security derivative, or a commodity derivative, based 
        upon the factors described in subsection (a)(2), giving 
        deference neither to the views of the Securities and Exchange 
        Commission nor the Commodity Futures Trading Commission.
            (4) Supreme court review.--Any request for certiorari to 
        the Supreme Court of the United States of any determination of 
        the United States Court of Appeals for the District of Columbia 
        Circuit with respect to a petition for review under this 
        subsection shall be filed with the Supreme Court of the United 
        States as soon as practicable after such determination is made.
            (5) Judicial stay.--The filing of a petition pursuant to 
        paragraph (1) shall operate as a judicial stay of the 
        identification of a derivative as a security-based swap, a 
        commodity-based swap, a security derivative, or a commodity 
        derivative until the date on which the determination of the 
        court is final, including any appeal of such determination.

SEC. 303. STUDY AND REPORT ON IMPLEMENTATION.

    (a) Study Required.--The Comptroller General of the United States 
shall conduct a study of--
            (1) how the Commodity Futures Trading Commission and the 
        Securities and Exchange Commission have implemented this Act 
        and the amendments made by this Act;
            (2) the extent to which jurisdictional disputes have 
        created challenges in the process of implementing this Act and 
        the amendments made by this Act; and
            (3) the benefits and drawbacks of harmonizing laws 
        implemented by the Commodity Futures Trading Commission and the 
        Securities and Exchange Commission, and merging those agencies.
    (b) Report Required.--Not later than 1 year after the date on which 
all rules are issued under section 304, the Comptroller General shall 
submit a report on the results of the study required by this section to 
Congress, the Commodity Futures Trading Commission, and the Securities 
and Exchange Commission.

SEC. 304. RULEMAKING.

    The Securities and Exchange Commission, the Commodity Futures 
Trading Commission, and the appropriate regulatory authorities (as that 
term is defined in section 15F(g) of the Securities Exchange Act of 
1934, as added by this Act, or section 4s(a) of the Commodity Exchange 
Act, as added by this Act), as applicable, shall issue rules under 
sections 15F(b), 15F(c), 15F(f), 17(l), 17C(c)(2), and 17C(d)(2) of the 
Securities Exchange Act of 1934 (as added by this Act), sections 
4r(c)(2), 4r(d)(2), 4s(c), 4s(d), and 4s(g) of the Commodity Exchange 
Act (as added by this Act), and sections 301 and 302 of this Act, not 
later than 180 days after the date of enactment of this Act.

SEC. 305. EFFECTIVE DATE.

    (a) In General.--Except as provided in subsection (b) or as 
specifically provided in the amendments made by this Act, this Act and 
the amendments made by this Act, shall become effective on the date of 
enactment of this Act.
    (b) Other Effective Dates.--The amendments made by sections 102(b) 
and 202(b) of this Act and the provisions of section 15F(a) of the 
Securities Exchange Act of 1934 (as added by this Act) and section 
4s(b) of the Commodity Exchange Act (as added by this Act) shall become 
effective 6 months after the date of enactment of this Act.
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