77728 Federal Register / Vol. 76, No. 240 / Wednesday, December 14, 2011 / Proposed Rules 

Docket No. 11–ASO–38.’’ The postcard 

will be date/time stamped and returned 

to the commenter. 

All communications received before 

the specified closing date for comments 

will be considered before taking action 

on the proposed rule. The proposal 

contained in this notice may be changed 

in light of the comments received. A 

report summarizing each substantive 

public contact with FAA personnel 

concerned with this rulemaking will be 

filed in the docket. 

Availability of NPRMs 

An electronic copy of this document 

may be downloaded from and 

comments submitted through http:// 

www.regulations.gov. Recently 

published rulemaking documents can 

also be accessed through the FAA’s web 

page at http://www.faa.gov/ 

airports_airtraffic/air_traffic/ 

publications/airspace_amendments/. 

You may review the public docket 

containing the proposal, any comments 

received and any final disposition in 

person in the Dockets Office (see the 

ADDRESSES section for address and 

phone number) between 9 a.m. and 

5 p.m., Monday through Friday, except 

Federal Holidays. An informal docket 

may also be examined during normal 

business hours at the office of the 

Eastern Service Center, Federal Aviation 

Administration, Room 350, 1701 

Columbia Avenue, College Park, Georgia 

30337. 

Persons interested in being placed on 

a mailing list for future NPRMs should 

contact the FAA’s Office of Rulemaking, 

(202) 267–9677, to request a copy of 

Advisory circular No. 11–2A, Notice of 

Proposed Rulemaking distribution 

System, which describes the application 

procedure. 

The Proposal 

The FAA is considering an 

amendment to Title 14, Code of Federal 

Regulations (14 CFR) part 71 to amend 

Class E airspace extending upward from 

700 feet above the surface at Columbia, 

SC, by removing Corporate Airport from 

the airspace designation and would 

establish Class E airspace extending 

upward from 700 feet above the surface 

to support new standard instrument 

approach procedures developed at 

Lexington County Airport at Pelion, 

Pelion, SC, formerly Corporate Airport. 

Airspace reconfiguration is necessary 

due to the design of new arrival 

procedures, and for continued safety 

and management of IFR operations at 

the airport. The geographic coordinates 

also would be adjusted to coincide with 

the FAAs aeronautical database. 

Class E airspace designations are 

published in Paragraph 6005 of FAA 

Order 7400.9V, dated August 9, 2011, 

and effective September 15, 2011, which 

is incorporated by reference in 14 CFR 

71.1. The Class E airspace designation 

listed in this document will be 

published subsequently in the Order. 

The FAA has determined that this 

proposed regulation only involves an 

established body of technical 

regulations for which frequent and 

routine amendments are necessary to 

keep them operationally current. It, 

therefore, (1) is not a ‘‘significant 

regulatory action’’ under Executive 

Order 12866; (2) is not a ‘‘significant 

rule’’ under DOT Regulatory Policies 

and Procedures (44 FR 11034; February 

26, 1979); and (3) does not warrant 

preparation of a Regulatory Evaluation 

as the anticipated impact is so minimal. 

Since this is a routine matter that will 

only affect air traffic procedures and air 

navigation, it is certified that this 

proposed rule, when promulgated, 

would not have a significant economic 

impact on a substantial number of small 

entities under the criteria of the 

Regulatory Flexibility Act. 

The FAA’s authority to issue rules 

regarding aviation safety is found in 

Title 49 of the United States Code. 

Subtitle I, Section 106 describes the 

authority of the FAA Administrator. 

Subtitle VII, Aviation Programs, 

describes in more detail the scope of the 

agency’s authority. This proposed 

rulemaking is promulgated under the 

authority described in Subtitle VII, Part, 

A, Subpart I, Section 40103. Under that 

section, the FAA is charged with 

prescribing regulations to assign the use 

of airspace necessary to ensure the 

safety of aircraft and the efficient use of 

airspace. This proposed regulation is 

within the scope of that authority as it 

would amend Class E airspace at 

Columbia, SC and establish Class E 

airspace at Lexington County Airport at 

Pelion, Pelion, SC. 

Lists of Subjects in 14 CFR Part 71 

Airspace, Incorporation by reference, 

Navigation (air). 

The Proposed Amendment 

In consideration of the foregoing, the 

Federal Aviation Administration 

proposes to amend 14 CFR part 71 as 

follows: 

PART 71—DESIGNATION OF CLASS A, 

B, C, D, AND E AIRSPACE AREAS; AIR 

TRAFFIC SERVICE ROUTES; AND 

REPORTING POINTS 

1. The authority citation for part 71 

continues to read as follows: 

Authority: 49 U.S.C. 106(g); 40103, 40113, 

40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959– 

1963 Comp., p. 389. 

§ 71.1 [Amended] 

2. The incorporation by reference in 

14 CFR 71.1 of Federal Aviation 

Administration Order 7400.9V, Airspace 

Designations and Reporting Points, 

dated August 9, 2011, effective 

September 15, 2011, is amended as 

follows: 

Paragraph 6005 Class E airspace areas 

extending upward from 700 feet or more 

above the surface of the earth. 

* * * * * 

ASO SC E5 Columbia, SC [Amended] 

Columbia Metropolitan Airport, SC 

(Lat. 33°56′20′′ N., long. 81°07′10′′ W.) 

Columbia Owens Downtown Airport 

(Lat. 33°58′14′′ N., long. 80°59′43′′ W.) 

That airspace extending upward from 700 

feet above the surface within a 10-mile radius 

of Columbia Metropolitan Airport and within 

a 6.5-mile radius of Columbia Owens 

Downtown Airport. 

* * * * * 

ASO SC E5 Pelion, SC [New] 

Lexington County Airport at Pelion, Pelion, 

SC 

(Lat. 33°47′41′′ N., long. 81°14′45′′ W.) 

That airspace extending upward from 700 

feet above the surface within a 6.6-mile 

radius of the Lexington County Airport at 

Pelion. 

Issued in College Park, Georgia, on 

December 5, 2011. 

Mark D. Ward, 

Manager, Operations Support Group, Eastern 

Service Center, Air Traffic Organization. 

[FR Doc. 2011–32041 Filed 12–13–11; 8:45 am] 

BILLING CODE 4910–13–P 

COMMODITY FUTURES TRADING 

COMMISSION 

17 CFR Parts 37 and 38 

RIN 3038–AD18 

Process for a Designated Contract 

Market or Swap Execution Facility To 

Make a Swap Available To Trade 

AGENCY: Commodity Futures Trading 

Commission. 

ACTION: Further notice of proposed 

rulemaking. 

SUMMARY: The Commodity Futures 

Trading Commission (‘‘Commission’’) is 

proposing regulations that establish a 

process for a designated contract market 

(‘‘DCM’’) or swap execution facility 

(‘‘SEF’’) to make a swap ‘‘available to 

trade’’ as set forth in new Section 2(h)(8) 

of the Commodity Exchange Act 

(‘‘CEA’’) pursuant to Section 723 of the 

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Federal Register / Vol. 76, No. 240 / Wednesday, December 14, 2011 / Proposed Rules 77729 

1See Dodd-Frank Wall Street Reform and 

Consumer Protection Act, Public Law 111–203, 124 

Stat. 1376 (2010). 

2Section 723(a)(3) of the Dodd-Frank Act 

amended the CEA to add a clearing requirement. 

This clearing requirement, under new Section 

2(h)(1)(A) of the CEA, provides that ‘‘[i]t shall be 

unlawful for any person to engage in a swap unless 

that person submits such swap for clearing to a 

derivatives clearing organization that is registered 

under this Act or a derivatives clearing organization 

that is exempt from registration under this Act if the 

swap is required to be cleared.’’ 

3Section 723(a)(3) of the Dodd-Frank Act 

amended the CEA to add a trade execution 

requirement. This trade execution requirement, 

under new Section 2(h)(8)(A) of the CEA, provides 

that with respect to transactions involving swaps 

subject to the clearing requirement of Section 

2(h)(1), ‘‘counterparties shall (i) execute the 

transaction on a board of trade designated as a 

contract market under section 5; or (ii) execute the 

transaction on a swap execution facility registered 

under 5h or a swap execution facility that is exempt 

from registration under section 5h(f) of this Act.’’ 

4The logical interpretation of the phrase ‘‘board 

of trade’’ in Section 2(h)(8)(B) means a board of 

trade designated as a contract market given such 

reference in Section 2(h)(8)(A). 

5Section 2(h)(7) of the CEA provides an 

exception to the clearing requirement (‘‘the enduser exception’’) if one of the counterparties to a 

swap (i) is not a financial entity, (ii) is using the 

swap to hedge or mitigate commercial risk, and (iii) 

notifies the Commission how it generally meets its 

financial obligations associated with entering into 

a non-cleared swap. 

6Core Principles and Other Requirements for 

Swap Execution Facilities, 76 FR 1214 (Jan. 7, 

2011). 

7 76 FR at 1241. 

8 Id. 

9 Id. 

10 Id. 

11 76 FR at 1222. Comments on all aspects of the 

SEF NPRM were due by March 8, 2011. On May 4, 

2011, the Commission reopened the SEF NPRM’s 

comment period through June 3, 2011, as part of the 

global extension of comment periods for various 

rulemakings implementing the Dodd-Frank Act to 

allow the public additional time to comment on the 

proposed new regulatory framework for swaps. See 

Reopening and Extension of Comment Periods for 

Rulemakings Implementing the Dodd-Frank Wall 

Street Reform and Consumer Protection Act, 76 FR 

25274 (May 4, 2011). 

12 76 FR at 1222. 

13These comments are available at http:// 

comments.cftc.gov/PublicComments/ 

CommentList.aspx?id=955. 

14Core Principles and Other Requirements for 

Designated Contract Markets, 75 FR 80572 (Dec. 22, 

2010). 

15See e.g., proposed Sections 38.8, 38.10, and 

38.451. Core Principles and Other Requirements for 

Designated Contract Markets, 75 FR 80572 (Dec. 22, 

2010). 

Dodd-Frank Wall Street Reform and 

Consumer Protection Act (‘‘Dodd-Frank 

Act’’). Only comments pertaining to the 

regulations proposed in this document 

will be considered as part of this further 

notice of proposed rulemaking 

(‘‘Notice’’). 

DATES: Submit comments on or before 

February 13, 2012. 

ADDRESSES: You may submit comments, 

identified by RIN number 3038–AD18 

and Process for a Designated Contract 

Market or Swap Execution Facility to 

Make a Swap Available to Trade, by any 

of the following methods: 

• Agency Web site, via its Comments 

Online process at http:// 

comments.cftc.gov. Follow the 

instructions for submitting comments 

through the Web site. 

• Mail: David A. Stawick, Secretary of 

the Commission, Commodity Futures 

Trading Commission, Three Lafayette 

Centre, 1155 21st Street NW., 

Washington, DC 20581. 

• Hand Delivery/Courier: Same as 

mail above. 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

Please submit your comments using 

only one method. 

All comments must be submitted in 

English, or if not, accompanied by an 

English translation. Comments will be 

posted as received to http:// 

www.cftc.gov. You should submit only 

information that you wish to make 

available publicly. If you wish the 

Commission to consider information 

that may be exempt from disclosure 

under the Freedom of Information Act, 

a petition for confidential treatment of 

the exempt information may be 

submitted according to the established 

procedures in § 145.9 of the 

Commission’s regulations, 17 CFR 

145.9. 

The Commission reserves the right, 

but shall have no obligation, to review, 

pre-screen, filter, redact, refuse or 

remove any or all of your submission 

from www.cftc.gov that it may deem to 

be inappropriate for publication, such as 

obscene language. All submissions that 

have been redacted or removed that 

contain comments on the merits of the 

rulemaking will be retained in the 

public comment file and will be 

considered as required under the 

Administrative Procedure Act and other 

applicable laws, and may be accessible 

under the Freedom of Information Act. 

FOR FURTHER INFORMATION CONTACT: 

Bella Rozenberg, Associate Director, 

Division of Market Oversight (‘‘DMO’’), 

(202) 418–5119, brozenberg@cftc.gov, 

Amir Zaidi, Special Counsel, DMO, 

(202) 418–6770, azaidi@cftc.gov, or 

Nhan Nguyen, Attorney Advisor, DMO, 

(202) 418–5932, nnguyen@cftc.gov, 

Commodity Futures Trading 

Commission, Three Lafayette Centre, 

1155 21st Street NW., Washington, DC 

20581. 

SUPPLEMENTARY INFORMATION: 

I. Background 

The Dodd-Frank Act 1 requires that 

swap transactions subject to the clearing 

requirement 2 must be executed on a 

DCM or SEF,3 subject to certain 

exceptions. Under Section 2(h)(8)(B) of 

the CEA, the exceptions to the trade 

execution requirement are if no board of 

trade 4 or SEF ‘‘makes the swap 

available to trade’’ or the related 

transaction is subject to the clearing 

exception under Section 2(h)(7) (i.e., the 

end-user exception).5

On January 7, 2011, the Commission 

published proposed rules, guidance, 

and acceptable practices (‘‘SEF NPRM’’) 

to implement certain statutory 

provisions for SEFs enacted by Title VII 

of the Dodd-Frank Act.6 In the SEF 

NPRM, the Commission proposed, 

among other rules, § 37.10 related to 

implementation of the available to trade 

provision under Section 2(h)(8) of the 

CEA.7 Proposed § 37.10 requires each 

SEF to conduct an annual review and 

assessment of whether it has made a 

swap available for trading and to 

provide a report to the Commission 

regarding its assessment.8 In its review 

and assessment, the SEF may consider 

the frequency of transactions, open 

interest, and any other factor requested 

by the Commission.9 Proposed § 37.10 

also requires that all SEFs are required 

to treat a swap as made available for 

trading, if at least one SEF has made the 

same or an economically equivalent 

swap available for trading.10

The SEF NPRM sought general public 

comment regarding the meaning of the 

phrase ‘‘made available for trading.’’ 11

The Commission also asked for 

comment on two specific questions: 

(1) Whether SEFs should consider the 

number of market participants trading a 

particular swap, and, if so, whether 

there should be a required minimum 

number of participants (e.g., two or 

three participants); and (2) whether 

SEFs should consider any other factors 

or processes to make the determination 

that swaps are made available for 

trading.12 The Commission received 26 

comments on the proposed ‘‘available to 

trade’’ process.13 The Commission has 

considered these comments, which are 

discussed below in the next section, in 

developing this Notice. 

On December 22, 2010, the 

Commission also published proposed 

rules, guidance, and acceptable 

practices (‘‘DCM NPRM’’) to implement 

certain statutory provisions for DCMs 

enacted by Title VII of the Dodd-Frank 

Act.14 The DCM NPRM did not establish 

any obligation for DCMs under Section 

2(h)(8) of the CEA, but it did establish 

certain swap reporting obligations.15

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77730 Federal Register / Vol. 76, No. 240 / Wednesday, December 14, 2011 / Proposed Rules 

16Sections 5(d)(1) and 5h(f)(1) of the CEA require 

DCMs and SEFs, respectively, to comply with any 

requirement that the Commission may impose by 

rule or regulation pursuant to Section 8a(5) of the 

CEA, 7 U.S.C. 12a(5), which authorizes the 

Commission to promulgate such regulations as, in 

the judgment of the Commission, are reasonably 

necessary to effectuate any of the provisions or to 

accomplish any of the purposes of the CEA. In 

addition, Section 721(b) of the Dodd-Frank Act 

provides the Commission with authority to adopt 

rules to define ‘‘[any] term included in an 

amendment to the Commodity Exchange Act * * * 

made by [the Dodd-Frank Act].’’ 

17E.g., Letter from Edward Rosen, Cleary Gottlieb 

Steen & Hamilton LLP, on behalf of certain dealers, 

dated Apr. 5, 2011 at 18–19; Letter from Kevin 

Gould, Markit, dated Mar. 8, 2011 at 3; Letter from 

Andrew Ertel, Evolution Markets Inc., dated Mar. 8, 

2011 at 9; Letter from Wholesale Market Brokers’ 

Association, Americas, dated Mar. 8, 2011 at 17–18. 

18Letter from Edward Rosen, Cleary Gottlieb 

Steen & Hamilton LLP, on behalf of certain dealers, 

dated Apr. 5, 2011 at 19. 

19Letter from Kevin Gould, Markit, dated Mar. 8, 

2011 at 3. 

20Letter from Andrew Ertel, Evolution Markets 

Inc., dated Mar. 8, 2011 at 9. 

21E.g., Letter from Craig Donohue, CME Group 

Inc., dated Mar. 8, 2011 at 10; Letter from Patrick 

Durkin, Barclays Capital, dated Mar. 8, 2011 at 11; 

Letter from Kevin Budd and Todd Lurie, MetLife, 

dated Mar. 8, 2011 at 4; Letter from Richard McVey, 

MarketAxess Corporation, dated Mar. 8, 2011 at 27; 

Letter from Timothy Cameron, Securities Industry 

and Financial Markets Association Asset 

Management Group, dated Mar. 8, 2011 at 11; Letter 

from Richard Whiting, Financial Services 

Roundtable, dated Mar. 8, 2011 at 8; Letter from R. 

Martin Chavez, Goldman, Sachs & Co., dated Mar. 

8, 2011 at 3; Letter from Warren Davis, Sutherland 

Asbill & Brennan LLP, on behalf of the Federal 

Home Loan Banks, dated Jun. 3, 2011 at 14; Letter 

from Wayne Pestone, FX Alliance Inc., dated Nov. 

4, 2011 at 9–10. 

22E.g., Letter from Wholesale Market Brokers’ 

Association, Americas, dated Mar. 8, 2011 at 17–18; 

Letter from Lee Olesky and Douglas Friedman, 

Tradeweb Markets LLC, dated Mar. 8, 2011 at 8– 

9; Letter from Coalition for Derivatives End-Users, 

dated Mar. 8, 2011 at 7–8. 

23E.g., Letter from Craig Donohue, CME Group 

Inc., dated Mar. 8, 2011 at 10; Letter from Patrick 

Durkin, Barclays Capital, dated Mar. 8, 2011 at 11; 

Letter from Kevin Budd and Todd Lurie, MetLife, 

dated Mar. 8, 2011 at 4; Letter from Timothy 

Cameron, Securities Industry and Financial Markets 

Association Asset Management Group, dated Mar. 

8, 2011 at 11; Letter from Wayne Pestone, FX 

Alliance Inc., dated Nov. 4, 2011 at 9–10. 

24E.g., Letter from Wholesale Market Brokers’ 

Association, Americas, dated Mar. 8, 2011 at 17–18; 

Letter from Lee Olesky and Douglas Friedman, 

Tradeweb Markets LLC, dated Mar. 8, 2011 at 8– 

9; Letter from Coalition for Derivatives End-Users, 

dated Mar. 8, 2011 at 7–8. 

25Section 40.1(i) defines rule as ‘‘any 

constitutional provision, article of incorporation, 

bylaw, rule, regulation, resolution, interpretation, 

stated policy, advisory, terms and conditions, 

trading protocol, agreement or instrument 

corresponding thereto, including those that 

authorize a response or establish standards for 

responding to a specific emergency, and any 

amendment or addition thereto or repeal thereof, 

made or issued by a registered entity or by the 

governing board thereof or any committee thereof, 

in whatever form adopted.’’ 

26The term ‘‘registered entity’’ is defined in the 

CEA to include both DCMs and SEFs. See Section 

1a(40) of the CEA, 7 U.S.C. 1a(40). 

27See Sections 40.5 and 40.6 and Provisions 

Common to Registered Entities, 76 FR 44776 (Jul. 

27, 2011). The Commission notes that the proposed 

procedures to make a swap available to trade are 

different than the procedures to list a swap for 

trading. A DCM or SEF may list a swap for trading 

by complying with the certification or approval 

procedures under §§ 40.2 or 40.3 of the 

Commission’s regulations. Under the certification 

procedures of § 40.2, a DCM or SEF may list a 

product on the business day following the 

Commission’s receipt of the submission, if received 

by the open of business. Under the approval 

procedures of § 40.3, a product is deemed approved 

by the Commission 45 days after receipt by the 

Commission or at the conclusion of an extended 

review period. A DCM or SEF may list the 

submitted product at that time. The Commission 

notes, however, the mere listing or trading of a 

swap on a DCM or SEF would not mean that the 

swap is available to trade within the meaning of 

Section 2(h)(8) of the CEA. The Commission further 

notes that a DCM or SEF must submit an available 

to trade filing at the same time or after submitting 

a filing under Sections 40.2 or 40.3. 

28Section 40.5(a). 

29E.g., Section 40.5(a)(6) requires a registered 

entity to post notice and a copy of the rule 

submission on its Web site, Section 40.5(a)(7) 

requires a registered entity to provide additional 

information which may be beneficial to the 

Commission in analyzing a new rule, and Section 

40.5(a)(8) requires a registered entity to provide in 

the rule submission a brief explanation of any 

substantive opposing views. 

II. Notice 

A. Introduction 

In this Notice, the Commission is 

proposing regulations to establish a 

process for a DCM or SEF to make a 

swap ‘‘available to trade’’ under Section 

2(h)(8) of the CEA.16 The proposed 

regulations would be included in 

proposed parts 37 and 38 of the 

Commission’s regulations to implement 

the available to trade provision in 

Section 2(h)(8) of the CEA. 

B. Process for a Designated Contract 

Market or Swap Execution Facility To 

Make a Swap Available To Trade Under 

Section 2(h)(8) of the CEA 

1. Procedure To Make a Swap Available 

to Trade—Proposed §§ 37.10(a) and 

38.12(a) 

a. Comments Regarding Available To 

Trade Process 

A key theme to emerge from the SEF 

NPRM comments is that the 

Commission should establish a process 

for determining when a swap is 

available to trade that includes greater 

Commission involvement.17 For 

example, one commenter suggested that 

a SEF certify to the Commission those 

swaps that qualify as available to trade 

and that, following a public notice and 

comment period, the Commission 

confirm (or reject) the SEF’s 

certification.18 Similarly, another 

commenter recommended that a SEF 

submit to the Commission those swaps 

it determines to be available to trade 

and that the Commission review the 

submission and provide at least a thirtyday public comment period regarding 

its decision.19 Another commenter 

encouraged the Commission to institute 

a process through which market 

participants could petition the 

Commission to review the 

appropriateness of a SEF’s 

determination that a swap is available to 

trade.20

Some commenters requested that the 

Commission determine whether a 

particular swap is available to trade 21

while other commenters requested that 

SEFs make this determination.22 Many 

commenters that supported a 

Commission determination noted that 

SEFs may have incentives to 

prematurely make certain swaps 

available to trade in order to mandate 

trading in these instruments on or 

through SEFs.23 The commenters that 

supported a SEF determination stated 

that SEFs should have some discretion 

whether a swap is made available to 

trade.24

In light of these comments and the 

fact that the DCM NPRM did not 

establish any obligation for DCMs under 

Section 2(h)(8) of the CEA, the 

Commission has determined to issue 

this Notice. 

b. Rule Submission Filing Procedure— 

Proposed §§ 37.10(a) and 38.12(a) 

Proposed §§ 37.10(a) and 38.12(a) set 

forth the filing procedure that SEFs and 

DCMs would utilize in order to 

demonstrate that a swap is available to 

trade. Under this proposed procedure, a 

DCM or SEF would initially determine 

that a swap is available to trade. The 

Commission views such determination 

as a trading protocol issued by a DCM 

or SEF. Such trading protocol falls 

under the definition of a rule under 

§ 40.1 of the Commission’s 

regulations.25 Therefore, pursuant to 

Section 5c(c) of the CEA, DCMs and 

SEFs would be required as ‘‘registered 

entities’’ 26 to submit make available to 

trade determinations to the 

Commission, either for approval or selfcertification, pursuant to the filing 

procedures of part 40 of the 

Commission’s regulations.27

Specifically, under this proposal, a 

DCM or SEF would be required to 

submit its determination that a swap is 

available to trade under § 40.5 or § 40.6 

of the Commission’s regulations. Under 

§ 40.5, a registered entity may request 

Commission approval of a new rule 

prior to its implementation.28 Section 

40.5(a) requires, among other things,29

that a registered entity that requests 

Commission prior approval provide an 

explanation and analysis of that 

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Federal Register / Vol. 76, No. 240 / Wednesday, December 14, 2011 / Proposed Rules 77731 

30Section 40.5(a)(5). This provision also requires, 

if applicable, a description of the anticipated 

benefits to market participants or others, any 

potential anticompetitive effects on market 

participants or others, and how the rule fits into the 

registered entity’s framework of self-regulation. 

31Sections 40.5(c) and (d). In determining 

whether to extend the review period, the 

Commission will consider whether the proposed 

rule raises novel or complex issues, the submission 

is incomplete, or the requestor does not respond 

completely to Commission questions in a timely 

manner. Section 40.5(d)(1). 

32Section 40.5(e). 

33Section 40.6(a). Section 40.6(a)(2) requires a 

registered entity to post notice and a copy of the 

rule submission on its Web site, Section 

40.6(a)(7)(vi) requires a registered entity to provide 

in the rule submission a brief explanation of any 

substantive opposing views, and Section 40.6(a)(8) 

requires a registered entity to provide, if requested 

by Commission staff, additional evidence, 

information, or data that may be beneficial to the 

Commission in conducting due diligence of the 

filing. 

34Sections 40.6(b) and (c). In determining 

whether to stay a certification, the Commission will 

consider whether the rule presents novel or 

complex issues, is accompanied by inadequate 

explanation, or is potentially inconsistent with the 

CEA. Section 40.6(c)(1). 

35Section 40.6(c)(2). 

36Section 40.6(c)(3). 

37See proposed §§ 37.10(c) and 38.12(c). Under 

these sections, if a SEF or DCM makes a swap 

available to trade, all other SEFs and DCMs listing 

or offering for trading such swap and/or any 

economically equivalent swap, shall make those 

swaps available to trade for purposes of the trade 

execution requirement. The Commission notes that 

if a DCM or SEF makes a swap available to trade, 

these proposed provisions would not require other 

DCMs and SEFs to list or offer that swap, or an 

economically equivalent swap, for trading. 

38See Swap Transaction Compliance and 

Implementation Schedule: Clearing and Trade 

Execution Requirements under Section 2(h) of the 

CEA, 76 FR 58186 (Sep. 20, 2011), for the time 

frame in which a swap would be subject to the trade 

execution requirement. The Commission notes that 

the available to trade determination may precede 

the clearing requirement and vice versa; however, 

the trade execution requirement would not be in 

effect until the clearing requirement takes effect. 

39E.g., Letter from Edward Rosen, Cleary Gottlieb 

Steen & Hamilton LLP, on behalf of certain dealers, 

dated Apr. 5, 2011 at 18; Letter from Kevin Gould, 

Markit, dated Mar. 8, 2011 at 2; Letter from Jeremy 

Barnum and Don Thompson, J.P. Morgan, dated 

Mar. 8, 2011 at 9; Letter from Robert Pickel and 

Kenneth Bentsen, International Swaps and 

Derivatives Association and Securities Industry and 

Financial Markets Association, dated Mar. 8, 2011 

at 8; Letter from R. Martin Chavez, Goldman, Sachs 

& Co., dated Mar. 8, 2011 at 3; Letter from Craig 

Donohue, CME Group Inc., dated Mar. 8, 2011 at 

9. 

40Letter from Edward Rosen, Cleary Gottlieb 

Steen & Hamilton LLP, on behalf of certain dealers, 

dated Apr. 5, 2011 at 18. 

41Letter from Dennis Kelleher, Better Markets, 

Inc., dated Mar. 8, 2011 at 10–11; Letter from 

Wholesale Market Brokers’ Association, Americas, 

dated Mar. 8, 2011 at 17–18; Letter from Ian K. 

Shepherd, Alice Corporation, dated May 31, 2011 

at 7. 

42Letter from Dennis Kelleher, Better Markets, 

Inc., dated Mar. 8, 2011 at 10–11. 

43E.g., Letter from Kevin Gould, Markit, dated 

Mar. 8, 2011 at 2; Letter from Craig Donohue, CME 

Group Inc., dated Mar. 8, 2011 at 10; Letter from 

John Gidman, Association of Institutional Investors, 

dated Jun. 10, 2011 at 3; Letter from Mark 

Vonderheide and Robert Creamer, Geneva Energy 

Markets, LLC, dated Jul. 29, 2011 at 2; Meeting 

between Commission staff and Evolution Markets 

and Ogilvy Government Relations, dated Jan. 19, 

2011. 

proposed rule and its compliance with 

applicable provisions of the CEA, 

including core principles, and the 

Commission’s regulations thereunder.30

This explanation and analysis would 

detail the manner in which the SEF or 

DCM considered the factors under 

proposed §§ 37.10(b) or 38.12(b). 

Sections 40.5(c) and (d) provide the 

Commission a 45-day review period, 

which may be extended for an 

additional 45 days in specified 

circumstances.31 At any time during its 

review, the Commission may notify the 

registered entity that it will not, or is 

unable to, approve a rule because it is 

inconsistent or appears to be 

inconsistent with the CEA or the 

Commission’s regulations.32

Similar to the approval procedures 

under § 40.5, if a registered entity 

chooses to submit its available to trade 

determination under the certification 

procedures of § 40.6, then the registered 

entity must provide to the Commission 

an explanation and analysis of the 

proposed rule and a certification that 

the rule complies with the CEA and the 

Commission’s regulations thereunder.33

As in § 40.5, the explanation and 

analysis would detail the manner in 

which the SEF or DCM considered the 

factors under proposed §§ 37.10(b) or 

38.12(b). Sections 40.6(b) and (c) 

provide the Commission 10 business 

days to review a rule before it is deemed 

certified and can be made effective, 

unless the Commission issues a stay of 

the certification for additional 90 days 

from the date of notification to the 

registered entity.34 If the Commission 

issues a stay of certification, then it 

must provide a 30-day public comment 

period for the proposed rule.35 During a 

stay period, the Commission may notify 

the registered entity that it objects to the 

proposed certification on the grounds 

that the proposed rule is inconsistent 

with the CEA or the Commission’s 

regulations.36

Under this Notice, if the Commission 

either approves a DCM’s or SEF’s rule 

providing that a swap is available to 

trade or permits a certified available to 

trade filing to become effective, then the 

swap involved would be deemed 

available to trade.37 If that swap also is 

subject to the clearing requirement, 

pursuant to CEA Section 2(h)(8), the 

swap must be executed pursuant to the 

rules of a DCM or SEF.38 Under this 

Notice, until such time, the swap is not 

subject to the CEA Section 2(h)(8) trade 

execution requirement. 

The Commission views the proposed 

procedure for DCMs and SEFs to make 

a swap available to trade as a balanced 

approach whereby a DCM or SEF—the 

facilities that may be most familiar with 

the trading of these swaps—has 

responsibility to make a swap available 

to trade, while the Commission has a 

role in reviewing such determination. 

Additionally, this proposed procedure 

is responsive to comments that the 

Commission should establish a process 

for DCMs and SEFs to make a swap 

available to trade, with Commission 

involvement in the determination. The 

Commission notes that as it gains 

experience with its oversight of swaps 

markets, it may decide, in its discretion, 

to determine that a swap is available to 

trade. 

2. Factors To Consider To Make a Swap 

Available To Trade—Proposed 

§§ 37.10(b) and 38.12(b) 

a. Comments Regarding Factors To 

Consider 

Many commenters to the SEF NPRM 

supported a liquidity requirement for a 

determination that a swap is available to 

trade.39 One commenter, for example, 

stated that ‘‘Congress intended for the 

Commission[] to establish a higher 

liquidity threshold for mandatory 

execution than for mandatory clearing, 

and that a swap is not ‘available to 

trade’ merely because it is listed on a 

DCM/exchange or SEF.’’ 40 However, 

other commenters said that a minimum 

level of liquidity should not be required 

for a determination that a swap is 

available to trade.41 One commenter 

noted that a determination that a swap 

is available to trade should apply to 

each swap that is subject to the clearing 

requirement and that the determination 

should not require a minimum level of 

trading activity.42

Many commenters also recommended 

specific liquidity factors that a SEF 

should consider in determining whether 

a swap is available to trade such as trade 

frequency and average transaction size, 

bid/offer spreads, number and types of 

market participants, and volume.43

Some commenters further suggested that 

the Commission set mandatory objective 

and transparent liquidity factors based 

upon an empirical analysis of swap 

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44E.g., Letter from Edward Rosen, Cleary Gottlieb 

Steen & Hamilton LLP, on behalf of certain dealers, 

dated Apr. 5, 2011 at 18; Letter from Ben 

Macdonald, Bloomberg L.P., dated Jun. 3, 2011 at 

3; Letter from Stuart Kaswell, Managed Funds 

Association, dated Mar. 8, 2011 at 3–4; Letter from 

American Benefits Council and Committee on 

Investment of Employee Benefit Assets, dated Mar. 

8, 2011 at 4–5. 

45Letter from Edward Rosen, Cleary Gottlieb 

Steen & Hamilton LLP, on behalf of certain dealers, 

dated Apr. 5, 2011 at 18. 

46Letter from Ben Macdonald, Bloomberg L.P., 

dated Jun. 3, 2011 at 3. 

47As noted above, the mere listing or trading of 

a swap on a DCM or SEF does not mean that the 

swap is available to trade. 

48 76 FR 1241. 49Letter from Edward Rosen, Cleary Gottlieb 

Steen & Hamilton LLP, on behalf of certain dealers, 

dated Apr. 5, 2011 at 19; Letter from Robert Pickel 

and Kenneth Bentsen, International Swaps and 

Derivatives Association and Securities Industry and 

Financial Markets Association, dated Mar. 8, 2011 

at 9; Letter from Wholesale Market Brokers’ 

Association, Americas, dated Mar. 8, 2011 at 18; 

Letter from Richard Whiting, Financial Services 

Roundtable, dated Mar. 8, 2011 at 7; Letter from 

Patrick Durkin, Barclays Capital, dated Mar. 8, 2011 

at 11. 

50Letter from Edward Rosen, Cleary Gottlieb 

Steen & Hamilton LLP, on behalf of certain dealers, 

dated Apr. 5, 2011 at 19; Letter from Robert Pickel 

and Kenneth Bentsen, International Swaps and 

Derivatives Association and Securities Industry and 

Financial Markets Association, dated Mar. 8, 2011 

at 9; Letter from Patrick Durkin, Barclays Capital, 

dated Mar. 8, 2011 at 11. 

51Letter from Richard Whiting, Financial 

Services Roundtable, dated Mar. 8, 2011 at 7. 

52Letter from Edward Rosen, Cleary Gottlieb 

Steen & Hamilton LLP, on behalf of certain dealers, 

dated Apr. 5, 2011 at 19. 

53E.g., Letter from Kevin Gould, Markit, dated 

Mar. 8, 2011 at 2; Letter from Dexter Senft, Morgan 

Stanley, dated Mar. 2, 2011 at 4; Letter from Stuart 

Kaswell, Managed Funds Association, dated Mar. 8, 

2011 at 4; Letter from Edward Rosen, Cleary 

Gottlieb Steen & Hamilton LLP, on behalf of certain 

dealers, dated Apr. 5, 2011 at 18–19. 

54Letter from Kevin Gould, Markit, dated Mar. 8, 

2011 at 2. 55Letter from Edward Rosen, Cleary Gottlieb 

Steen & Hamilton LLP, on behalf of certain dealers, 

dated Apr. 5, 2011 at 18–19. 

trading data.44 One commenter stated 

that the Commission should undertake 

empirical analyses of swap market 

liquidity to set specific quantitative 

thresholds for metrics, such as 

minimum average daily trading volume 

and number of transactions.45 Another 

commenter asserted that objective 

measures for determining when a swap 

is available to trade will provide for a 

consistent and meaningful 

assessment.46

b. Factors To Consider—Proposed 

§§ 37.10(b) and 38.12(b) 

Proposed §§ 37.10(b) and 38.12(b) 

state that, to make a swap available to 

trade, for purposes of Section 2(h)(8) of 

the CEA, a SEF or DCM shall consider, 

as appropriate, the following factors 

with respect to such swap: (1) Whether 

there are ready and willing buyers and 

sellers; (2) The frequency or size of 

transactions on SEFs, DCMs, or of 

bilateral transactions; (3) The trading 

volume on SEFs, DCMs, or of bilateral 

transactions; (4) The number and types 

of market participants; (5) The bid/ask 

spread; (6) The usual number of resting 

firm or indicative bids and offers; (7) 

Whether a SEF’s trading system or 

platform or a DCM’s trading facility will 

support trading in the swap; or (8) Any 

other factor that the SEF or DCM may 

consider relevant.47 No single factor 

would be dispositive, as the DCM or 

SEF may consider any one factor or 

several factors to make a swap available 

to trade. The Commission notes that, as 

the swaps markets evolve and the 

Commission gains experience with 

overseeing these markets, it may 

consider setting objective factors based 

upon an empirical analysis of swap 

trading data in a future rulemaking. 

3. Economically Equivalent Swap— 

Proposed §§ 37.10(c) and 38.12(c) 

a. Comments Regarding Economically 

Equivalent Swaps 

In the SEF NPRM, the Commission 

proposed that all SEFs are required to 

treat a swap as ‘‘made available for 

trading,’’ if at least one SEF has made 

the same or an economically equivalent 

swap available for trading.48 Many 

commenters to the SEF NPRM requested 

that the Commission clarify the term 

economically equivalent swap and some 

commenters provided recommendations 

as to how it should be defined.49 Several 

commenters recommended a stringent 

fungibility test to determine whether a 

particular swap is economically 

equivalent to one made available to 

trade on another SEF, such that a 

derivatives clearing organization 

(‘‘DCO’’) would recognize the swaps as 

mutually off-settable without residual 

market risk.50 Another commenter 

suggested that only identical swaps 

should be made available to trade.51

Furthermore, one commenter cautioned 

that without a stringent fungibility test 

there may be unintended consequences, 

including unduly concentrating trading 

volume on a single SEF or preventing 

participants from entering into 

customized swaps in the same general 

swap category.52

b. Economically Equivalent Swap— 

Proposed §§ 37.10(c) and 38.12(c) 

Under proposed §§ 37.10(c)(1) and 

38.12(c)(1), upon a determination that a 

swap is available to trade, all other SEFs 

and DCMs listing or offering for trading 

such swap and/or any economically 

equivalent swap, must make those 

swaps available to trade for purposes of 

the trade execution requirement set 

forth in Section 2(h)(8) of the CEA. The 

Commission notes that if a DCM or SEF 

makes a swap available to trade, these 

proposed provisions would not require 

other DCMs and SEFs to list or offer that 

swap, or an economically equivalent 

swap, for trading. 

In this Notice, the Commission is 

proposing a definition for the term 

‘‘economically equivalent swap.’’ 

Proposed §§ 37.10(c)(2) and 38.12(c)(2) 

define the term ‘‘economically 

equivalent swap’’ as a swap that the SEF 

or DCM determines to be economically 

equivalent with another swap after 

consideration of each swap’s material 

pricing terms. 

4. Annual Review of Available To Trade 

Determinations—Proposed §§ 37.10(d) 

and 38.12(d) 

a. Comments Regarding Annual Review 

Several commenters to the SEF NPRM 

supported a Commission review 

requirement for swaps that have been 

determined to be available to trade.53

One commenter asserted that SEF 

available to trade determinations should 

be revisited and reconsidered because 

the liquidity of swaps can experience 

significant changes over time and can 

dry up completely in some 

circumstances.54 Similarly, another 

commenter stated that SEFs should 

revisit available to trade determinations 

on a quarterly basis because the level of 

liquidity for a swap can vary 

significantly over time.55

b. Annual Review—Proposed 

§§ 37.10(d) and 38.12(d) 

The Commission is proposing to 

retain the annual review and assessment 

requirement set forth in the SEF NPRM 

and also require that DCMs perform an 

annual review and assessment. Regular 

reviews help ensure that DCMs and 

SEFs routinely evaluate whether swaps 

previously determined to be available to 

trade should continue to be treated in 

that manner. Thus, in conducting this 

review and assessment, the proposal 

would require a SEF or DCM to consider 

the factors in §§ 37.10(b) or 38.12(b), 

respectively. The Commission would 

also encourage DCMs and SEFs, in 

conducting this review and assessment, 

to evaluate their swaps that have not 

been determined to be available to trade 

and to submit them to the Commission 

as appropriate. Upon completion of the 

annual review, a DCM or SEF would be 

required to provide electronically to the 

Commission a report of such review and 

assessment, including any supporting 

information or data, no later than 30 

days after its fiscal year end. 

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Federal Register / Vol. 76, No. 240 / Wednesday, December 14, 2011 / Proposed Rules 77733 

56E.g., Letter from Dexter Senft, Morgan Stanley, 

dated Mar. 2, 2011 at 4; Letter from Timothy 

Cameron, Securities Industry and Financial Markets 

Association Asset Management Group, dated Mar. 

8, 2011 at 12; Letter from Wayne Pestone, FX 

Alliance Inc., dated Nov. 4, 2011 at 9–10. 

57Letter from Dexter Senft, Morgan Stanley, dated 

Mar. 2, 2011 at 4. 

58Letter from Timothy Cameron, Securities 

Industry and Financial Markets Association Asset 

Management Group, dated Mar. 8, 2011 at 12. 

59See Sections 40.5(a)(6) and 40.6(a)(2). 

60Letter from Kevin Budd and Todd Lurie, 

MetLife, dated Mar. 8, 2011 at 4; Letter from Dexter 

Senft, Morgan Stanley, dated Mar. 2, 2011 at 4; 

Letter from Stuart Kaswell, Managed Funds 

Association, dated Mar. 8, 2011 at 3. Some of these 

commenters requested that the Commission 

establish a waiting period after the available to 

trade determination and before the trade execution 

requirement becomes effective. 

61Letter from Kevin Budd and Todd Lurie, 

MetLife, dated Mar. 8, 2011 at 4; Letter from Dexter 

Senft, Morgan Stanley, dated Mar. 2, 2011 at 4; 

Letter from Stuart Kaswell, Managed Funds 

Association, dated Mar. 8, 2011 at 3. 

62Letter from Stuart Kaswell, Managed Funds 

Association, dated Mar. 8, 2011 at 3. 

63Letter from Kevin Budd and Todd Lurie, 

MetLife, dated Mar. 8, 2011 at 4. 

64See Swap Transaction Compliance and 

Implementation Schedule: Clearing and Trade 

Execution Requirements under Section 2(h) of the 

CEA, 76 FR 58186 (Sep. 20, 2011). Comments to 

this notice of proposed rulemaking were due by 

November 4, 2011. 

65 Id. 

5. Notice to the Public of Available To 

Trade Determinations 

a. Comments Regarding Notice to the 

Public 

Some commenters to the SEF NPRM 

requested that the Commission provide 

notice to market participants that a 

swap is available to trade.56 One 

commenter, for example, suggested that 

the Commission provide public notice 

that a swap will be deemed available to 

trade and on which platform(s).57

Another commenter stated that 

‘‘[w]ithout a notification system, market 

participants may not know to cease 

over-the-counter transactions in these 

swaps, stifling compliance with 

applicable rules.’’ 58

b. Public Notice 

In consideration of the comments 

received, the Commission notes that 

there is a process for notifying the 

public that a DCM or SEF has made a 

swap available to trade. Sections 40.5 

and 40.6 of the Commission’s 

regulations require DCMs and SEFs to 

post a notice and a copy of rule 

submissions on their Web site 

concurrent with the filing of the 

submissions with the Commission.59

The Commission, consistent with 

current practice, will also post DCM and 

SEF rule submission filings on its Web 

site. The Commission is currently 

assessing the feasibility of posting 

notices of all swaps that are determined 

to be available to trade on an easily 

accessible page on its Web site. 

6. Effective Date of Available To Trade 

Determinations 

a. Comments Regarding Effective Date 

Commenters to the SEF NPRM 

requested a waiting period before the 

effective date of the available to trade 

determinations or before imposing the 

trade execution requirement under CEA 

Section 2(h)(8) so that other SEFs have 

adequate time to list or offer the swap 

or any economically equivalent swap for 

trading.60 These commenters stated that 

a reasonable waiting period will 

promote competition among SEFs by 

reducing a SEF’s first-mover 

advantage.61 For example, the waiting 

period would allow other SEFs 

additional time to build the required 

connectivity.62 A waiting period would 

also allow market participants the 

opportunity to make any related 

technological and trading strategy 

amendments.63

b. Effective Date 

In response to commenters who 

requested a waiting period before the 

effective date of a determination that a 

swap is available to trade or before 

imposing the trade execution 

requirement under CEA Section 2(h)(8), 

the Commission has issued a notice of 

proposed rulemaking that proposes a 

schedule to phase in compliance with 

the trade execution requirement under 

CEA Section 2(h)(8).64 Under that 

proposed rulemaking, a swap 

transaction shall be subject to the CEA 

Section 2(h)(8) trade execution 

requirement upon the later of the 

following: (1) the applicable deadline 

established under the compliance 

schedule for the clearing requirement or 

(2) 30 days after the swap is first made 

available to trade on either a SEF or 

DCM.65

C. Comment Requested 

The Commission requests and will 

consider comments only on proposed 

regulations §§ 37.10 and 38.12. The 

Commission may consider alternatives 

to the proposed regulations and is 

requesting comment on the following 

questions: 

• Should the Commission allow a 

SEF or DCM to submit its available to 

trade determination with respect to a 

group, category, type, or class of swaps 

based on the factors in §§ 37.10(b) or 

38.12(b)? How should the Commission 

define group, category, type, or class of 

swaps? 

• Is the Commission’s proposed 

approach in §§ 37.10(b) and 38.12(b) 

regarding the determination that a swap 

is available to trade appropriate? If not, 

what approach is appropriate and why? 

Should a SEF or DCM consider total 

open interest and notional outstanding 

for similar tenors in §§ 37.10(b) and 

38.12(b)? 

• In evaluating the factors under 

proposed §§ 37.10(b) and 38.12(b), 

should the Commission allow a SEF or 

DCM to consider the same swap or an 

economically equivalent swap on 

another SEF or DCM? What are the 

advantages and disadvantages of such 

an approach? Should a SEF or DCM 

consider the amount of activity in the 

same swap or an economically 

equivalent swap available primarily or 

solely in bilateral transactions? 

• Should the Commission allow a 

SEF or DCM to submit an available to 

trade determination under §§ 37.10(a) or 

38.12(a), if such SEF or DCM does not 

itself list the subject swap for trading? 

If so, in evaluating the factors under 

§§ 37.10(b) or 38.12(b), should the 

Commission allow the SEF or DCM to 

consider the same swap or an 

economically equivalent swap on 

another SEF or DCM? What are the 

advantages and disadvantages of such 

an approach? Should a SEF or DCM 

consider the amount of activity in the 

same swap or an economically 

equivalent swap available primarily or 

solely in bilateral transactions? 

• When a DCM or SEF makes a swap 

available to trade, should all other 

DCMs and SEFs listing or offering for 

trading such swap and/or any 

economically equivalent swap be 

required to make those swaps available 

to trade? What would be the economic 

impact on those DCMs and SEFs that 

would be required to make same swaps 

and/or economically equivalent swaps 

available to trade? 

• If a SEF or DCM is required to make 

an economically equivalent swap 

available to trade, should that SEF or 

DCM be required to submit, under part 

40 procedures, its reasoning for 

deciding that a certain swap is or is not 

economically equivalent to another 

swap? Should a SEF or DCM be required 

to consider the factors under §§ 37.10(b) 

or 38.12(b)? Should a SEF or DCM be 

able to use the factors under §§ 37.10(b) 

or 38.12(b) to submit to the Commission 

for consideration that an economically 

equivalent swap should not be subject 

to the requirement under §§ 37.10(c)(1) 

or 38.12(c)(1)? Should a DCM or SEF 

provide the Commission notice that an 

economically equivalent swap has been 

made available to trade? If so, should 

the Commission provide notice to the 

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77734 Federal Register / Vol. 76, No. 240 / Wednesday, December 14, 2011 / Proposed Rules 

66 5 U.S.C. 601 et seq. 

67See 17 CFR part 40 Provisions Common to 

Registered Entities, 75 FR 67282 (Nov. 2, 2010); see 

also 47 FR 18618, 18619 (Apr. 30, 1982) and 66 FR 

45604, 45609 (Aug. 29, 2001). 

68See, e.g., Core Principle 2 applicable to DCMs 

under Section 735 of the Dodd-Frank Act and Core 

Principle 2 applicable to SEFs under Section 733 

of the Dodd-Frank Act. 69 44 U.S.C. 3501 et seq. 

70 7 U.S.C. 12(a)(1). 

71 5 U.S.C. 552a. 

public? If so, how? How would market 

participants conducting bilateral 

transactions know that an economically 

equivalent swap has been made 

available to trade? 

• Is the Commission’s proposed 

definition of the term ‘‘economically 

equivalent swap’’ appropriate? If not, 

how should the Commission revise the 

definition as applicable to proposed 

§§ 37.10 and 38.12 and why? Are there 

other factors that the Commission 

should consider when defining the term 

economically equivalent swap? Should 

the Commission require that DCMs and 

SEFs consider specific material pricing 

terms? If so, what terms and why? For 

instance, should DCMs and SEFs 

consider same tenor or same underlying 

instrument? Should the Commission or 

DCMs and SEFs make the determination 

of which swaps are economically 

equivalent? 

• Is the Commission’s proposal that 

DCMs and SEFs conduct reviews and 

assessments appropriate? If not, what is 

appropriate and why? 

• Should the Commission specify a 

process whereby a swap that has been 

determined to be available to trade may 

be determined to no longer be available 

to trade? If so, should the Commission 

use the rule submission procedure 

under part 40 for this process and why? 

Please explain the details of this 

approach, including who would make 

the determination that a swap is no 

longer available to trade. Should such a 

determination apply to all DCMs and 

SEFs universally or should it only apply 

to the particular DCM or SEF that seeks 

to no longer make a swap available to 

trade? What are the advantages and 

disadvantages of such approach? If the 

Commission should not specify a 

process to no longer make a swap 

available to trade, please explain why. 

III. Related Matters 

A. Regulatory Flexibility Act 

The Regulatory Flexibility Act 

(‘‘RFA’’) requires that agencies consider 

whether the rules they propose will 

have a significant economic impact on 

a substantial number of small entities 

and, if so, provide a regulatory 

flexibility analysis respecting the 

impact.66 The Commission previously 

determined that DCMs and SEFs are not 

‘‘small entities’’ for purposes of the 

RFA.67 In determining that these 

registered entities are not ‘‘small 

entities,’’ the Commission reasoned that 

it designates a contract market or 

registers a SEF only if the entity meets 

a number of specific criteria, including 

the expenditure of sufficient resources 

to establish and maintain an adequate 

self-regulatory program.68 Because 

DCMs and SEFs are required to 

demonstrate compliance with Core 

Principles, including principles 

concerning the maintenance or 

expenditure of financial resources, the 

Commission previously determined that 

SEFs, like DCMs, are not ‘‘small 

entities’’ for the purposes of the RFA. 

Accordingly, the Chairman, on behalf 

of the Commission, hereby certifies 

pursuant to 5 U.S.C. 605(b) that the 

proposed rules will not have a 

significant economic impact on a 

substantial number of small entities. 

The Commission invites public 

comment on this determination. 

B. Paperwork Reduction Act 

The Paperwork Reduction Act 

(‘‘PRA’’) 69 imposes certain 

requirements on federal agencies in 

connection with conducting or 

sponsoring any collection of 

information as defined by the PRA. The 

Commission may not conduct or 

sponsor, and a registered entity is not 

required to respond to, a collection of 

information unless it displays a 

currently valid Office of Management 

and Budget (‘‘OMB’’) control number. 

This proposed rulemaking will result in 

new collection of information 

requirements within the meaning of the 

PRA. The Commission therefore is 

submitting this proposal to OMB for 

review in accordance with 44 U.S.C. 

3507(d) and 5 CFR 1320.11. The title for 

the collection of information is ‘‘Parts 

37 and 38—Process for a Swap 

Execution Facility or Designated 

Contract Market to Make a Swap 

Available to Trade.’’ The OMB has not 

yet assigned this collection a control 

number. 

Many of the responses to this new 

collection of information are mandatory. 

The Commission protects proprietary 

information according to the Freedom of 

Information Act and 17 CFR part 145, 

‘‘Commission Records and 

Information.’’ In addition, Section 

8(a)(1) of the CEA strictly prohibits the 

Commission, unless specifically 

authorized by the CEA, from making 

public ‘‘data and information that 

would separately disclose the business 

transactions or market positions of any 

person and trade secrets or names of 

customers.’’ 70 The Commission is also 

required to protect certain information 

contained in a government system of 

records according to the Privacy Act of 

1974.71

1. Information Provided by Reporting 

Entities/Persons 

The proposed regulations require 

SEFs and DCMs to collect and submit to 

the Commission information concerning 

available to trade determinations 

pursuant to §§ 37.10 and 38.12. For 

instance, SEFs and DCMs must submit 

available to trade determinations to the 

Commission as rules under part 40 

pursuant to proposed §§ 37.10(a) and 

38.12(a). SEFs and DCMs must also 

submit annual reports to the 

Commission pursuant to proposed 

§§ 37.10(d) and 38.12(d). 

The Commission has estimated the 

final information collection burdens on 

DCMs and SEFs below. These estimates 

account for the following: (1) The 

number of respondents; and (2) the 

average hours required to produce each 

response. The Commission estimates 

that 50 registered entities will be 

required to file rule submissions and 

annual reports. 

SEFs and DCMs must submit 

available to trade determinations to the 

Commission as rules under part 40 

pursuant to proposed §§ 37.10(a) and 

38.12(a). The Commission previously 

estimated the hourly burdens for DCMs 

and SEFs to comply with part 40. While 

the Commission has no way of knowing 

the exact hourly burden upon a 

registered entity prior to 

implementation of the regulations 

governing that registered entity, the 

Commission estimates that the burden 

for a SEF or DCM under proposed 

§§ 37.10(a) and 38.12(a) will be similar 

to the previously estimated hours of 

burden under part 40—2.00 hours. 

However, the Commission notes that 

DCMs and SEFs would have to review 

certain factors and data (if applicable) to 

make a swap available to trade so these 

submissions may take additional time. 

Therefore, the Commission estimates 

that the hourly burden for a SEF or DCM 

under proposed §§ 37.10(a) and 38.12(a) 

will be as follows: 

Estimated number of respondents: 50. 

Estimated average hours per response: 

8.00. 

The Commission recognizes that 

DCMs and SEFs may submit several rule 

submission filings per year. At this time, 

it is not feasible to estimate the number 

of rule submission filings per year, on 

average, per DCM or SEF as the number 

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72See Process for Review of Swaps for Mandatory 

Clearing, 76 FR 44464 (Jul. 26, 2011). 73 7 U.S.C. 19(a). 

74See Report on Management & Professional 

Earnings in the Securities Industry 2010, Securities 

Industry and Financial Markets Association at 4 

(Sep. 2010). The report lists the average total annual 

compensation for a compliance specialist 

(intermediate) as $59,878. The Commission 

estimated the personnel’s hourly cost by assuming 

an 1,800 hour work year and by multiplying by 1.3 

to account for overhead and other benefits. 

of swap contracts that will be traded on 

a DCM or SEF and the number of those 

swaps that a DCM or SEF will determine 

to make available to trade is presently 

unknown. 

Proposed §§ 37.10(d) and 38.12(d) 

require SEFs and DCMs to submit 

annual reports, including any 

supporting information and data, to the 

Commission of their review and 

assessment of the swaps they made 

available to trade. The Commission 

previously estimated the number of 

filings and the hourly burdens for 

submissions by each DCO regarding 

swaps that they plan to accept for 

clearing under Section 39.5.72 The 

Commission estimated that each DCO 

will submit to the Commission one 

filing annually for the swaps that they 

plan to accept for clearing. While the 

Commission has no way of knowing the 

exact hourly burden upon a registered 

entity prior to implementation of the 

regulations governing that registered 

entity, the Commission estimates that 

the burden for a SEF or DCM under 

proposed §§ 37.10(d) and 38.12(d) will 

be similar to the previously estimated 

hours of burden under Section 39.5— 

40.00 hours. The Commission estimates 

the burden for SEFs and DCMs under 

proposed §§ 37.10(d) and 38.12(d) as 

follows: 

Estimated number of respondents: 50. 

Annual responses by each 

respondent: 1. 

Estimated average hours per response: 

40. 

Aggregate annual reporting burden 

hours (for all respondents): 2,000. 

The Commission invites public 

comment on the accuracy of its estimate 

of the collection requirements that 

would result from the proposed 

regulations. 

2. Information Collection Comments 

The Commission invites the public 

and other federal agencies to comment 

on the information collection 

requirements proposed in this Notice. 

Pursuant to 44 U.S.C. 3506(c)(2)(B), the 

Commission solicits comments to: (1) 

Evaluate whether the proposed 

collections of information are necessary 

for the proper performance of the 

functions of the Commission, including 

whether the information will have 

practical utility; (2) evaluate the 

accuracy of the estimated burden of the 

proposed information collection 

requirements, including the degree to 

which the methodology and the 

assumptions that the Commission 

employed were valid; (3) determine 

whether there are ways to enhance the 

quality, utility, or clarity of the 

information proposed to be collected; 

and (4) minimize the burden of the 

proposed collections of information on 

DCMs and SEFs, including through the 

use of appropriate automated, 

electronic, mechanical, or other 

technological information collection 

techniques, e.g., permitting electronic 

submission of responses. 

The public and other federal agencies 

may submit comments directly to the 

Office of Information and Regulatory 

Affairs, OMB, by fax at (202) 395–6566 

or by email at 

OIRAsubmission@omb.eop.gov. Please 

provide the Commission with a copy of 

submitted comments so that they can be 

summarized and addressed in the final 

rule. Refer to the Addresses section of 

this Notice for comment submission 

instructions to the Commission. A copy 

of the supporting statements for the 

collections of information discussed 

above may be obtained by visiting 

RegInfo.gov. OMB is required to make a 

decision concerning the collection of 

information between 30 and 60 days 

after publication of this release. 

Therefore, a comment to OMB is best 

assured of receiving full consideration if 

OMB (and the Commission) receives it 

within 30 days of publication of this 

Notice. Nothing in the foregoing affects 

the deadline enumerated above for 

public comment to the Commission on 

the proposed regulations. 

C. Consideration of Costs and Benefits 

In this section, the Commission 

addresses the costs and benefits of its 

proposed regulations and also considers 

the five broad areas of market and 

public concern under Section 15(a) of 

the CEA73 within the context of the 

proposed regulations. 

In this Notice, the Commission 

considers the costs and benefits that 

result from the regulations proposed 

herein; these costs and benefits are in 

addition to the costs and benefits 

associated with the SEF NPRM as 

previously proposed. In other words, 

the Commission is only considering the 

discrete costs and benefits of the 

regulations specifically proposed in this 

Notice. To this end, the Commission 

solicits comments only on the costs and 

benefits of the proposed requirements 

herein; only comments pertaining to 

these cost and benefit issues will be 

considered as part of this Notice. 

1. Costs of Proposed Regulations 

The Commission anticipates that the 

proposed regulations will result in some 

additional operational and monitoring 

costs to DCMs and SEFs. The 

Commission requests commenters 

provide quantitative estimates of the 

additional costs and benefits to DCMs 

and SEFs from this Notice. 

Under these proposed regulations, 

DCMs and SEFs may incur additional 

costs in undertaking evaluations of 

whether a swap is available to trade and 

submitting to the Commission their 

determinations with respect to such 

swaps as rule submission filings 

pursuant to the procedures under part 

40 of the Commission’s regulations. 

Proposed §§ 37.10(b) and 38.12(b) 

require SEFs and DCMs to consider 

certain factors to make a swap available 

to trade. Proposed §§ 37.10(a) and 

38.12(a) require SEFs and DCMs to 

submit to the Commission their 

determinations with respect to those 

swaps that they make available to trade 

as a rule pursuant to the procedures 

under part 40 of the Commission’s 

regulations. 

The above-described assessment and 

submission may be performed internally 

by one compliance personnel of the 

DCM or SEF. The Commission estimates 

that it would take the compliance 

personnel approximately eight hours, on 

average, to assess and submit the 

available to trade determination per rule 

submission filing. The compliance 

personnel would have to, for example, 

consider factors to make a swap 

available to trade and write a cover 

submission to the Commission, 

including a description of the swap or 

swaps that are covered and an 

explanation and analysis of the 

available to trade determination. The 

Commission notes that this is a general 

estimate and that it is difficult to 

determine with reasonable precision the 

number of hours involved given the 

novelty of this available to trade 

process. The Commission estimates the 

cost per hour for one compliance 

personnel to be $43.25 per hour.74

Therefore, the Commission estimates 

that it would cost each DCM and SEF an 

additional $346.00 per rule submission 

filing to comply with the proposed 

requirements. 

Certain additional factors may affect 

the cost estimates noted above. For 

example, swaps with complex terms 

and conditions or requests for 

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77736 Federal Register / Vol. 76, No. 240 / Wednesday, December 14, 2011 / Proposed Rules 

75The SEF NPRM imposed a review and 

assessment process for SEFs. 76 7 U.S.C. 19(a). 

77See, e.g., Fisherman’s Doc Co-op., Inc v. Brown, 

75 F.3d 164 (4th Cir. 1996); Center for Auto Safety 

v. Peck, 751 F.2d 1336 (DC Cir. 1985) (noting that 

an agency has discretion to weigh factors in 

undertaking cost-benefit analysis). 

additional information or questions 

from Commission staff regarding the 

available to trade determination may 

result in higher costs. 

The Commission also recognizes that 

DCMs and SEFs may submit several rule 

submission filings per year. At this time, 

it is not feasible to estimate the number 

of rule submission filings per year per 

DCM or SEF as the number of swap 

contracts that will be traded on a DCM 

or SEF and the number of those swaps 

that a DCM or SEF will determine to 

make available to trade is presently 

unknown. 

Under proposed §§ 37.10(c) or 

38.12(c), if a SEF or DCM makes a swap 

available to trade, all SEFs and DCMs 

listing or offering such swap and/or any 

economically equivalent swap, shall 

make those swaps available to trade for 

purposes of Section 2(h)(8) of the CEA. 

Further, such contracts may not be 

traded on a bilateral basis. In order to 

comply with this requirement, DCMs, 

SEFs, and market participants would 

have to monitor and identify those 

contracts that are either the same or 

economically equivalent to that swap 

made available to trade. At this time, it 

is not feasible to estimate the number of 

hours involved given the novelty of the 

available to trade process. 

The Commission seeks comment on 

all aspects of the cost estimates 

provided above. Specifically, the 

Commission seeks comment on the 

period of time, the number and type of 

personnel, and the cost estimates for 

DCMs and SEFs to comply with the 

assessment process as described above. 

The Commission also seeks comment on 

the number of hours per year, on 

average, that a SEF or DCM will spend 

monitoring and evaluating swap 

contracts in order to comply with 

proposed §§ 37.10(c) and 38.12(c). 

Proposed § 38.12(d) would require 

DCMs to incur additional costs to 

conduct an annual review and 

assessment of each swap it has made 

available to trade and submit its review 

and assessment to the Commission.75

This assessment may be performed 

internally by one compliance personnel 

of the DCM. The Commission estimates 

that it would take the compliance 

personnel approximately 40 hours, on 

average, to conduct this review and 

assessment. The Commission notes that 

this is a general estimate and that it is 

difficult to determine with reasonable 

precision the number of hours involved 

given the novelty of this process. As 

noted above, the Commission estimates 

the cost per hour for one compliance 

personnel to be $43.25 per hour. 

Therefore, the Commission estimates 

that it would cost each DCM an 

additional $1,730.00 per review to 

comply with the proposed 

requirements. 

2. Benefits of Proposed Regulations 

The proposed regulations are 

expected to provide needed certainty for 

DCMs, SEFs, and market participants for 

the available to trade process. The 

proposed regulations, for example, set 

forth the procedure to make a swap 

available to trade, the factors to consider 

in making a swap available to trade, and 

visibility into which swaps are available 

to trade. Additionally, the proposed 

regulations are expected to promote the 

trading of swaps on DCMs and SEFs and 

promote competition among these 

entities. DCMs and SEFs, who may be 

most familiar with the trading of swaps, 

would make swaps available to trade 

based on factors specified by the 

Commission. DCMs and SEFs have 

discretion to consider any one factor or 

several factors to make a swap available 

to trade. These aspects of the proposed 

regulations are intended to facilitate 

DCMs and SEFs to make swaps 

available to trade, which is expected to 

promote the trading of swaps on DCMs 

and SEFs and competition among these 

entities. Finally, the proposed 

regulations are expected to promote 

price discovery because those swaps 

that DCMs and SEFs make available to 

trade would effectively be subject to the 

trade execution requirement, which 

would require them to trade solely on 

DCMs and SEFs. 

The Commission seeks comment on 

all aspects of the benefits of its proposed 

regulations in this Notice. 

3. Section 15(a) Discussion 

Section 15(a) of the CEA 76 requires 

the Commission to consider the costs 

and benefits of its action before 

promulgating a regulation under the 

CEA. Section 15(a) of the CEA specifies 

that the costs and benefits shall be 

evaluated in light of five broad areas of 

market and public concern: (a) 

Protection of market participants and 

the public; (b) efficiency, 

competitiveness and financial integrity 

of futures markets; (c) price discovery; 

(d) sound risk management practices; 

and (e) other public interest 

considerations. The Commission may in 

its discretion give greater weight to any 

one of the five enumerated areas and 

could in its discretion determine that, 

notwithstanding its costs, a particular 

regulation is necessary or appropriate to 

protect the public interest or to 

effectuate any of the provisions or 

accomplish any of the purposes of the 

CEA.77

a. Protection of Market Participants and 

the Public 

The proposed regulations are 

intended to provide certainty for DCMs, 

SEFs, and market participants for the 

available to trade process. Under the 

proposed regulations, a SEF or DCM 

must consider certain factors specified 

by the Commission under Sections 

37.10(b) or 38.12(b), respectively, to 

make a swap available to trade. A DCM 

or SEF must also submit available to 

trade determinations to the 

Commission, either for approval or 

under certification procedures, pursuant 

to the rule filing procedures of part 40 

of the Commission’s regulations. Part 40 

also requires DCMs and SEFs to post a 

notice and a copy of rule submissions 

on their Web site concurrent with the 

filing of the submissions with the 

Commission. The Commission, 

consistent with current practice, will 

also post DCM and SEF rule submission 

filings on its Web site. Therefore, under 

the proposed regulations, DCMs, SEFs, 

and market participants would know 

the factors to consider in making a swap 

available to trade, the procedure to 

make a swap available to trade, and the 

swaps that are available to trade, which 

provides certainty to the available to 

trade process. This certainty also 

promotes the protection of market 

participants by ensuring that there is 

transparency in the available to trade 

process. 

The proposed regulations are also 

expected to promote the protection of 

market participants and the public by 

providing for Commission review and 

oversight and public participation. 

Under the proposed regulations, the 

Commission would either approve or 

review the DCM’s or SEF’s available to 

trade determination. To facilitate this 

approval or review, the proposed 

regulations require DCMs and SEFs to 

provide the Commission with a brief 

explanation of any substantive opposing 

views in rule filings and, if the 

Commission extends the rule review 

period under the self-certification 

procedure, then there will be a 30-day 

public comment period. These aspects 

of the proposed regulations are expected 

to provide appropriate oversight, and 

may increase the transparency, of DCM 

and SEF available to trade 

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Federal Register / Vol. 76, No. 240 / Wednesday, December 14, 2011 / Proposed Rules 77737 

determinations. This oversight and 

transparency is expected to increase the 

likelihood that all important issues will 

be identified and weighed by the 

Commission, which may protect market 

participants and the public. 

b. Efficiency, Competitiveness, and 

Financial Integrity of the Markets 

The proposed regulations are 

expected to promote the trading of 

swaps on DCMs and SEFs and promote 

competition among these entities. DCMs 

and SEFs, who may be most familiar 

with the trading of swaps, would make 

swaps available to trade based on factors 

specified by the Commission. DCMs and 

SEFs would have discretion to consider 

any one factor or several factors to make 

a swap available to trade. These aspects 

of the proposed regulations are intended 

to facilitate DCMs and SEFs to make 

swaps available to trade, which is 

expected to promote the trading of 

swaps on DCMs and SEFs and 

competition among these entities. 

Additionally, the requirement that 

DCMs and SEFs must make the same 

swap and any economically equivalent 

swap available to trade may increase the 

number of swaps trading on DCMs and 

SEFs, which is expected to promote the 

trading of swaps on DCMs and SEFs. 

c. Price Discovery 

As mentioned above, the proposed 

regulations are expected to promote the 

trading of swaps on DCMs and SEFs. 

Those swaps that DCMs and SEFs make 

available to trade could be subject to the 

trade execution requirement. These 

swaps would be required to trade solely 

on DCMs and SEFs, which would 

promote price discovery. 

d. Sound Risk Management Practices 

The proposed regulations are not 

expected to affect sound risk 

management practices. 

e. Other Public Interest Considerations 

The proposed regulations are not 

expected to affect public interest 

considerations other than those 

identified above. 

The Commission specifically invites 

public comment on its application of 

the criteria contained in Section 15(a) of 

the CEA and further invites interested 

parties to submit any data, quantitative 

or qualitative, that they may have 

concerning the costs and benefits of the 

proposed regulations. 

List of Subjects 

17 CFR Part 37 

Registered entities, Reporting and 

recordkeeping requirements, Swap 

execution facilities, Swaps. 

17 CFR Part 38 

Designated contract markets, 

Registered entities, Reporting and 

recordkeeping requirements, Swaps. 

For the reasons stated in the 

preamble, the Commission proposes to 

amend 17 CFR parts 37 and 38 as 

follows: 

PART 37—SWAP EXECUTION 

FACILITIES 

1. The authority citation for part 37 

continues to read as follows: 

Authority: 7 U.S.C. 1a, 2, 5, 6, 6c, 7, 7a– 

2, 7b–3 and 12a, as amended by Titles VII 

and VIII of the Dodd-Frank Wall Street 

Reform and Consumer Protection Act, Pub. L. 

111–203, 124 Stat. 1376 (2010). 

2. The heading of part 37 is revised 

to read as set forth above. 

3. Add new § 37.10 to read as follows: 

§ 37.10 Process for a swap execution 

facility to make a swap available to trade. 

(a) Required submission. A swap 

execution facility that makes a swap 

available to trade in accordance with 

paragraph (b) of this section, shall 

submit to the Commission its 

determination with respect to such 

swap pursuant to the procedures under 

part 40 of this chapter. 

(b) Factors to consider. To make a 

swap available to trade, for purposes of 

Section 2(h)(8) of the Commodity 

Exchange Act, a swap execution facility 

shall consider, as appropriate, the 

following factors with respect to such 

swap: 

(1) Whether there are ready and 

willing buyers and sellers; 

(2) The frequency or size of 

transactions on swap execution 

facilities, designated contract markets, 

or of bilateral transactions; 

(3) The trading volume on swap 

execution facilities, designated contract 

markets, or of bilateral transactions; 

(4) The number and types of market 

participants; 

(5) The bid/ask spread; 

(6) The usual number of resting firm 

or indicative bids and offers; 

(7) Whether a swap execution 

facility’s trading system or platform will 

support trading in the swap; or 

(8) Any other factor that the swap 

execution facility may consider 

relevant. 

(c) Economically equivalent swap. (1) 

Upon a determination that a swap is 

available to trade, all other swap 

execution facilities and designated 

contract markets listing or offering for 

trading such swap and/or any 

economically equivalent swap, shall 

make those swaps available to trade for 

purposes of Section 2(h)(8) of the 

Commodity Exchange Act. 

(2) For purposes of this section, the 

term ‘‘economically equivalent swap’’ 

means a swap that the swap execution 

facility or designated contract market 

determines to be economically 

equivalent with another swap after 

consideration of each swap’s material 

pricing terms. 

(d) Annual review. (1) A swap 

execution facility shall conduct an 

annual review and assessment of each 

swap it has made available to trade to 

determine whether or not each swap 

should continue to be available to trade. 

The annual review shall be conducted at 

the swap execution facility’s fiscal year 

end. 

(2) When conducting its review and 

assessment pursuant to paragraph (d)(1) 

of this section, a swap execution facility 

shall consider the factors specified in 

paragraph (b) of this section. 

(3) The swap execution facility shall 

provide electronically to the 

Commission a report of its review and 

assessment, including any supporting 

information or data, not more than 30 

days after the swap execution facility’s 

fiscal year end. 

PART 38—DESIGNATED CONTRACT 

MARKETS 

4. The authority citation for part 38 

continues to read as follows: 

Authority: 7 U.S.C. 1a, 2, 6, 6a, 6c, 6d, 6e, 

6f, 6g, 6i, 6j, 6k, 6l, 6m, 6n, 7, 7a–2, 7b, 7b– 

1, 7b–3, 8, 9, 15, and 21, as amended by the 

Dodd-Frank Wall Street Reform and 

Consumer Protection Act, Pub. L. 111–203, 

124 Stat. 1376 (2010). 

5. Add new § 38.12 to read as follows: 

§ 38.12 Process for a designated contract 

market to make a swap available to trade. 

(a) Required submission. A designated 

contract market that makes a swap 

available to trade in accordance with 

paragraph (b) of this section, shall 

submit to the Commission its 

determination with respect to such 

swap pursuant to the procedures under 

part 40 of this chapter. 

(b) Factors to consider. To make a 

swap available to trade, for purposes of 

Section 2(h)(8) of the Commodity 

Exchange Act, a designated contract 

market shall consider, as appropriate, 

the following factors with respect to 

such swap: 

(1) Whether there are ready and 

willing buyers and sellers; 

(2) The frequency or size of 

transactions on designated contract 

markets, swap execution facilities, or of 

bilateral transactions; 

(3) The trading volume on designated 

contract markets, swap execution 

facilities, or of bilateral transactions; 

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77738 Federal Register / Vol. 76, No. 240 / Wednesday, December 14, 2011 / Proposed Rules 

(4) The number and types of market 

participants; 

(5) The bid/ask spread; 

(6) The usual number of resting firm 

or indicative bids and offers; 

(7) Whether a designated contract 

market’s trading facility will support 

trading in the swap; or 

(8) Any other factor that the 

designated contract market may 

consider relevant. 

(c) Economically equivalent swap. (1) 

Upon a determination that a swap is 

available to trade, all other designated 

contract markets and swap execution 

facilities listing or offering for trading 

such swap and/or any economically 

equivalent swap, shall make those 

swaps available to trade for purposes of 

Section 2(h)(8) of the Commodity 

Exchange Act. 

(2) For purposes of this section, the 

term ‘‘economically equivalent swap’’ 

means a swap that the designated 

contract market or swap execution 

facility determines to be economically 

equivalent with another swap after 

consideration of each swap’s material 

pricing terms. 

(d) Annual review. (1) A designated 

contract market shall conduct an annual 

review and assessment of each swap it 

has made available to trade to determine 

whether or not each swap should 

continue to be available to trade. The 

annual review shall be conducted at the 

designated contract market’s fiscal year 

end. 

(2) When conducting its review and 

assessment pursuant to paragraph (d)(1) 

of this section, a designated contract 

market shall consider the factors 

specified in paragraph (b) of this 

section. 

(3) The designated contract market 

shall provide electronically to the 

Commission a report of its review and 

assessment, including any supporting 

information or data, not more than 30 

days after the designated contract 

market’s fiscal year end. 

Issued in Washington, DC, on December 5, 

2011, by the Commission. 

David A. Stawick, 

Secretary of the Commission. 

Note: The following appendices will not 

appear in the Code of Federal Regulations 

Appendices to Process for a Designated 

Contract Market or Swap Execution 

Facility To Make a Swap Available To 

Trade—Commissioners Voting 

Summary and Statements of 

Commissioners 

Appendix 1—Commissioners Voting 

Summary 

On this matter, Chairman Gensler and 

Commissioners Chilton, O’Malia and Wetjen 

voted in the affirmative; Commissioner 

Sommers voted in the negative. 

Appendix 2—Statement of Chairman 

Gary Gensler 

I support the proposed rule to implement 

a process for designated contract markets 

(DCMs) and swap execution facilities (SEFs) 

to make a swap ‘‘available to trade.’’ The 

Dodd-Frank Wall Street Reform and 

Consumer Protection Act requires that swaps 

subject to the clearing requirement be traded 

on a DCM or SEF, unless no DCM or SEF 

makes the swap available to trade or the 

swap transaction is subject to the end-user 

exception. This proposal will bring 

transparency to the process for making a 

swap available to trade on a DCM or SEF. It 

also will provide appropriate oversight of the 

process through Commodity Futures Trading 

Commission review. 

[FR Doc. 2011–31646 Filed 12–13–11; 8:45 am] 

BILLING CODE 6351–01–P 

ARCHITECTURAL AND 

TRANSPORTATION BARRIERS 

COMPLIANCE BOARD 

36 CFR Parts 1193 and 1194 

[Docket No. 2011–07] 

RIN 3014–AA37 

Telecommunications Act Accessibility 

Guidelines; Electronic and Information 

Technology Accessibility Standards 

AGENCY: Architectural and 

Transportation Barriers Compliance 

Board. 

ACTION: Notice of hearing. 

SUMMARY: The Architectural and 

Transportation Barriers Compliance 

Board (Access Board) will hold two 

public hearings on its recent Advance 

Notice of Proposed Rulemaking to 

update its Telecommunications Act 

Accessibility Guidelines and its 

Electronic and Information Technology 

Accessibility Standards. 

DATES: The hearings will be held on the 

following dates: 

1. January 11, 2012, 9 to Noon, 

Washington, DC. 

2. March 1, 2012, 1 to 3 p.m., San 

Diego, CA. 

ADDRESSES: The hearing locations are: 

1. Washington, DC: Access Board 

conference room, 1331 F Street NW., 

suite 800, Washington, DC 20004. 

2. San Diego, CA: Manchester Grand 

Hyatt Hotel, One Market Place, San 

Diego, CA 92101. 

FOR FURTHER INFORMATION CONTACT: Tim 

Creagan, Office of Technical and 

Information Services, Architectural and 

Transportation Barriers Compliance 

Board, 1331 F Street NW., suite 1000, 

Washington, DC 20004–1111. 

Telephone number: (202) 272–0016 

(voice); (202) 272–0074 (TTY). 

Electronic mail address: 

creagan@access-board.gov. 

SUPPLEMENTARY INFORMATION: On 

December 8, 2011, the Access Board 

published an advance notice of 

proposed rulemaking in the Federal 

Register to continue the process of 

updating its guidelines for 

telecommunications equipment covered 

by Section 255 of the 

Telecommunications Act of 1996 and its 

standards for electronic and information 

technology covered by Section 508 of 

the Rehabilitation Act Amendments of 

1998. 76 FR 76640 (December 8, 2011). 

The comment period for the advance 

notice closes on March 7, 2012. The 

Board will hold two public hearings 

during the comment period. The first 

hearing will be in Washington, DC in 

the Access Board’s conference room at 

1331 F Street NW., suite 800, 

Washington, DC 20004. The second 

hearing will be held in conjunction with 

the 27th Annual International 

Technology and Persons with 

Disabilities Conference (CSUN 

Conference) in San Diego, CA at the 

Manchester Grand Hyatt Hotel, One 

Market Place, San Diego, CA 92101. 

The hearing locations are accessible to 

individuals with disabilities. Sign 

language interpreters and real-time 

captioning will be provided. For the 

comfort of other participants, persons 

attending the hearings are requested to 

refrain from using perfume, cologne, 

and other fragrances. To pre-register to 

testify, please contact Kathy Johnson at 

(202) 272–0041, (202) 272–0082 (TTY), 

or johnson@access-board.gov. More 

information and any updates to the 

hearings will be posted on the Access 

Board’s Web site at http://www.accessboard.gov/508.htm. 

David M. Capozzi, 

Executive Director. 

[FR Doc. 2011–32020 Filed 12–13–11; 8:45 am] 

BILLING CODE 8150–01–P 

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