II 

113TH CONGRESS 

2D SESSION H. R. 5471 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 3, 2014 

Received; read twice and referred to the Committee on Banking, Housing, and 

Urban Affairs 

DECEMBER 10, 2014 

Committee discharged; referred to the Committee on Agriculture, Nutrition, 

and Forestry 

AN ACT 

To amend the Commodity Exchange Act and the Securities 

Exchange Act of 1934 to specify how clearing requirements apply to certain affiliate transactions, and for 

other purposes. 

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

3 SECTION 1. TREATMENT OF AFFILIATE TRANSACTIONS. 

4 (a) IN GENERAL.— 

5 (1) COMMODITY EXCHANGE ACT AMEND6 MENT.—Section 2(h)(7)(D)(i) of the Commodity Ex7 change Act (7 U.S.C. 2(h)(7)(D)(i)) is amended to 

8 read as follows: 


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1 ‘‘(i) IN GENERAL.—An affiliate of a 

2 person that qualifies for an exception 

3 under subparagraph (A) (including affiliate 

4 entities predominantly engaged in pro5 viding financing for the purchase of the 

6 merchandise or manufactured goods of the 

7 person) may qualify for the exception only 

8 if the affiliate enters into the swap to 

9 hedge or mitigate the commercial risk of 

10 the person or other affiliate of the person 

11 that is not a financial entity, provided that 

12 if the hedge or mitigation of such commer13 cial risk is addressed by entering into a 

14 swap with a swap dealer or major swap 

15 participant, an appropriate credit support 

16 measure or other mechanism must be uti17 lized.’’. 

18 (2) SECURITIES EXCHANGE ACT OF 1934

19 AMENDMENT.—Section 3C(g)(4)(A) of the Securities 

20 Exchange Act of 1934 (15 U.S.C. 78c–3(g)(4)(A)) 

21 is amended to read as follows: 

22 ‘‘(A) IN GENERAL.—An affiliate of a per23 son that qualifies for an exception under para24 graph (1) (including affiliate entities predomi25 nantly engaged in providing financing for the 


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1 purchase of the merchandise or manufactured 

2 goods of the person) may qualify for the excep3 tion only if the affiliate enters into the security4 based swap to hedge or mitigate the commercial 

5 risk of the person or other affiliate of the per6 son that is not a financial entity, provided that 

7 if the hedge or mitigation such commercial risk 

8 is addressed by entering into a security-based 

9 swap with a security-based swap dealer or 

10 major security-based swap participant, an ap11 propriate credit support measure or other 

12 mechanism must be utilized.’’. 

13 (b) APPLICABILITY OF CREDIT SUPPORT MEASURE

14 REQUIREMENT.—The requirements in section 

15 2(h)(7)(D)(i) of the Commodity Exchange Act and section 

16 3C(g)(4)(A) of the Securities Exchange Act of 1934, as 

17 amended by subsection (a), requiring that a credit support 

18 measure or other mechanism be utilized if the transfer of 

19 commercial risk referred to in such sections is addressed 

20 by entering into a swap with a swap dealer or major swap 

21 participant or a security-based swap with a security-based 

22 swap dealer or major security-based swap participant, as 

23 appropriate, shall not apply with respect to swaps or secuVerDate Sep 11 2014 03:01 Dec 11, 2014 Jkt 049200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H5471.RCS H5471

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1 rity-based swaps, as appropriate, entered into before the 

2 date of the enactment of this Act. 

Passed the House of Representatives December 2, 

2014. 

Attest: KAREN L. HAAS, 

Clerk. 


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