IIB 

113TH CONGRESS 

1ST SESSION H. R. 1256 

IN THE SENATE OF THE UNITED STATES 

JUNE 13, 2013 

Received; read twice and referred to the Committee on Agriculture, Nutrition, 

and Forestry 

AN ACT 

To direct the Securities and Exchange Commission and the 

Commodity Futures Trading Commission to jointly adopt 

rules setting forth the application to cross-border swaps 

transactions of certain provisions relating to swaps that 

were enacted as part of the Dodd-Frank Wall Street 

Reform and Consumer Protection Act. 


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1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Swap Jurisdiction Cer5 tainty Act’’. 

6 SEC. 2. JOINT RULEMAKING ON CROSS-BORDER SWAPS. 

7 (a) JOINT RULEMAKING REQUIRED.— 

8 (1) IN GENERAL.—Not later than 270 days 

9 after the date of enactment of this Act, the Securi10 ties and Exchange Commission and the Commodity 

11 Futures Trading Commission shall jointly issue rules 

12 setting forth the application of United States swaps 

13 requirements of the Securities Exchange Act of 

14 1934 and the Commodity Exchange Act relating to 

15 cross-border swaps and security-based swaps trans16 actions involving U.S. persons or non-U.S. persons. 

17 (2) CONSTRUCTION.—The rules required under 

18 paragraph (1) shall be identical, notwithstanding 

19 any difference in the authorities granted the Com20 missions in section 30(c) of the Securities Exchange 

21 Act of 1934 (15 U.S.C. 78dd(c)) and section 2(i) of 

22 the Commodity Exchange Act (7 U.S.C. 2(i)), re23 spectively, except to the extent necessary to accom24 modate differences in other underlying statutory reVerDate Mar 15 2010 19:59 Jun 14, 2013 Jkt 029200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H1256.RFS H1256

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1 quirements under such Acts, and the rules there2 under. 

3 (b) CONSIDERATIONS.—The Commissions shall joint4 ly issue rules that address— 

5 (1) the nature of the connections to the United 

6 States that require a non-U.S. person to register as 

7 a swap dealer, major swap participant, security8 based swap dealer, or major security-based swap 

9 participant under each Commission’s respective Acts 

10 and the regulations issued under such Acts; 

11 (2) which of the United States swaps require12 ments shall apply to the swap and security-based 

13 swap activities of non-U.S. persons, U.S. persons, 

14 and their branches, agencies, subsidiaries, and affili15 ates outside of the United States and the extent to 

16 which such requirements shall apply; and 

17 (3) the circumstances under which a non-U.S. 

18 person in compliance with the regulatory require19 ments of a foreign jurisdiction shall be exempt from 

20 United States swaps requirements. 

21 (c) RULE IN ACCORDANCE WITH APA REQUIRED.— 

22 No guidance, memorandum of understanding, or any such 

23 other agreement may satisfy the requirement to issue a 

24 joint rule from the Commissions in accordance with sec25 tion 553 of title 5, United States Code. 


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1 (d) GENERAL APPLICATION TO COUNTRIES OR AD2 MINISTRATIVE REGIONS HAVING NINE LARGEST MAR3 KETS.— 

4 (1) GENERAL APPLICATION.—In issuing rules 

5 under this section, the Commissions shall provide 

6 that a non-U.S. person in compliance with the swaps 

7 regulatory requirements of a country or administra8 tive region that has one of the nine largest combined 

9 swap and security-based swap markets by notional 

10 amount in the calendar year preceding issuance of 

11 such rules, or other foreign jurisdiction as jointly de12 termined by the Commissions, shall be exempt from 

13 United States swaps requirements in accordance 

14 with the schedule set forth in paragraph (2), unless 

15 the Commissions jointly determine that the regu16 latory requirements of such country or administra17 tive region or other foreign jurisdiction are not 

18 broadly equivalent to United States swaps require19 ments. 

20 (2) EFFECTIVE DATE SCHEDULE.—The exemp21 tion described in paragraph (1) and set forth under 

22 the rules required by this section shall apply to per23 sons or transactions relating to or involving— 

24 (A) countries or administrative regions de25 scribed in such paragraph, or any other foreign 


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1 jurisdiction as jointly determined by the Com2 missions, accounting for the five largest com3 bined swap and security-based swap markets by 

4 notional amount in the calendar year preceding 

5 issuance of such rules, on the date on which 

6 final rules are issued under this section; and 

7 (B) the remaining countries or administra8 tive regions described in such paragraph, and 

9 any other foreign jurisdiction as jointly deter10 mined by the Commissions, 1 year after the 

11 date on which such rules are issued. 

12 (3) CRITERIA.—In such rules, the Commissions 

13 shall jointly establish criteria for determining that 

14 one or more categories of regulatory requirements of 

15 a country or administrative region described in para16 graph (1) or other foreign jurisdiction is not broadly 

17 equivalent to United States swaps requirements and 

18 shall jointly determine the appropriate application of 

19 certain United States swap requirements to persons 

20 or transactions relating to or involving such country 

21 or administrative region or other foreign jurisdiction. 

22 Such criteria shall include the scope and objectives 

23 of the regulatory requirements of a country or ad24 ministrative region described in paragraph (1) or 

25 other foreign jurisdiction as well as the effectiveness 


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1 of the supervisory compliance program administered, 

2 and the enforcement authority exercised, by such 

3 country or administrative region or other foreign ju4 risdiction, and such other factors as the Commis5 sions, by rule, jointly determine to be necessary or 

6 appropriate in the public interest. 

7 (4) REQUIRED ASSESSMENT.—Beginning on the 

8 date on which final rules are issued under this sec9 tion, the Commissions shall begin to jointly assess 

10 the regulatory requirements of countries or adminis11 trative regions described in paragraph (1), as the 

12 Commissions jointly determine appropriate, in ac13 cordance with the criteria established pursuant to 

14 this subsection, to determine if one or more cat15 egories of regulatory requirements of such a country 

16 or administrative region or other foreign jurisdiction 

17 is not broadly equivalent to United States swaps re18 quirements. 

19 (e) REPORT TO CONGRESS.—If the Commissions 

20 make the joint determination described in subsection 

21 (d)(1) that the regulatory requirements of a country or 

22 administrative region described in such subsection or other 

23 foreign jurisdiction are not broadly equivalent to United 

24 States swaps requirements, the Commissions shall articu25 late the basis for such a determination in a written report 


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1 transmitted to the Committee on Financial Services and 

2 the Committee on Agriculture of the House of Representa3 tives and the Committee on Banking, Housing, and Urban 

4 Affairs and the Committee on Agriculture, Nutrition, and 

5 Forestry of the Senate within 30 days of the determina6 tion. The determination shall not be effective until the 

7 transmission of such report. 

8 (f) DEFINITIONS.—As used in this Act and for pur9 poses of the rules issued pursuant to this Act, the fol10 lowing definitions apply: 

11 (1) The term ‘‘U.S. person’’— 

12 (A) means— 

13 (i) any natural person resident in the 

14 United States; 

15 (ii) any partnership, corporation, 

16 trust, or other legal person organized or 

17 incorporated under the laws of the United 

18 States or having its principal place of busi19 ness in the United States; 

20 (iii) any account (whether discre21 tionary or non-discretionary) of a U.S. per22 son; and 

23 (iv) any other person as the Commis24 sions may further jointly define to more efVerDate Mar 15 2010 19:59 Jun 14, 2013 Jkt 029200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H1256.RFS H1256

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1 fectively carry out the purposes of this Act; 

2 and 

3 (B) does not include the International 

4 Monetary Fund, the International Bank for Re5 construction and Development, the Inter-Amer6 ican Development Bank, the Asian Development 

7 Bank, the African Development Bank, the 

8 United Nations, their agencies and pension 

9 plans, and any other similar international orga10 nizations and their agencies and pension plans. 

11 (2) The term ‘‘United States swaps require12 ments’’ means the provisions relating to swaps and 

13 security-based swaps contained in the Commodity 

14 Exchange Act (7 U.S.C. 1a et seq.) and the Securi15 ties Exchange Act of 1934 (15 U.S.C. 78a et seq.) 

16 that were added by title VII of the Dodd-Frank Wall 

17 Street Reform and Consumer Protection Act (15 

18 U.S.C. 8301 et seq.) and any rules or regulations 

19 prescribed by the Securities and Exchange Commis20 sion and the Commodity Futures Trading Commis21 sion pursuant to such provisions. 

22 (g) CONFORMING AMENDMENTS.— 

23 (1) SECURITIES EXCHANGE ACT OF 1934.— 

24 Section 36(c) of the Securities Exchange Act of 

25 1934 (15 U.S.C. 78mm(c)) is amended by inserting 


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1 ‘‘or except as necessary to effectuate the purposes of 

2 the Swap Jurisdiction Certainty Act,’’ after ‘‘to 

3 grant exemptions,’’. 

4 (2) COMMODITY EXCHANGE ACT.—Section 

5 4(c)(1)(A) of the Commodity Exchange Act (7 

6 U.S.C. 6(c)(1)(A)) is amended by inserting ‘‘or ex7 cept as necessary to effectuate the purposes of the 

8 Swap Jurisdiction Certainty Act,’’ after ‘‘to grant 

9 exemptions,’’. 

Passed the House of Representatives June 12, 2013. 

Attest: KAREN L. HAAS, 

Clerk. 


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