II 

113TH CONGRESS 

2D SESSION S. 2976 

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. 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 4, 2014 

Ms. COLLINS (for herself and Ms. KLOBUCHAR) introduced the following bill; 

which was read twice and referred to the Committee on Agriculture, Nutrition, and Forestry 

A BILL 

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. SHORT TITLE. 

4 This Act may be cited as the ‘‘Derivatives End-Users 

5 Clarification Act’’. 

6 SEC. 2. TREATMENT OF AFFILIATE TRANSACTIONS. 

7 (a) IN GENERAL.— 


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1 (1) COMMODITY EXCHANGE ACT AMEND2 MENT.—Section 2(h)(7)(D) of the Commodity Ex3 change Act (7 U.S.C. 2(h)(7)(D)) is amended by 

4 striking clause (i) and inserting the following: 

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

6 person that qualifies for an exception 

7 under subparagraph (A) (including affiliate 

8 entities predominantly engaged in pro9 viding financing for the purchase of the 

10 merchandise or manufactured goods of the 

11 person) may qualify for the exception only 

12 if the affiliate enters into the swap to 

13 hedge or mitigate the commercial risk of 

14 the person or other affiliate of the person 

15 that is not a financial entity, on the condi16 tion that if the hedge or mitigation of that 

17 commercial risk is addressed by entering 

18 into a swap with a swap dealer or major 

19 swap participant, an appropriate credit 

20 support measure or other mechanism shall 

21 be used.’’. 

22 (2) SECURITIES EXCHANGE ACT OF 1934

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

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


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1 amended by striking subparagraph (A) and inserting 

2 the following: 

3 ‘‘(A) IN GENERAL.—An affiliate of a per4 son that qualifies for an exception under this 

5 subsection (including affiliate entities predomi6 nantly engaged in providing financing for the 

7 purchase of the merchandise or manufactured 

8 goods of the person) may qualify for the excep9 tion only if the affiliate enters into the security10 based swap to hedge or mitigate the commercial 

11 risk of the person or other affiliate of the per12 son that is not a financial entity, on the condi13 tion that if the hedge or mitigation of that com14 mercial risk is addressed by entering into a se15 curity-based swap with a security-based swap 

16 dealer or major security-based swap participant, 

17 an appropriate credit support measure or other 

18 mechanism shall be used.’’. 

19 (b) APPLICABILITY OF CREDIT SUPPORT MEASURE

20 REQUIREMENT.—The requirements of section 

21 2(h)(7)(D)(i) of the Commodity Exchange Act (7 U.S.C. 

22 2(h)(7)(D)(i)) and section 3C(g)(4)(A) of the Securities 

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

24 amended by subsection (a)) shall not apply with respect 


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1 to swaps or security-based swaps, as appropriate, entered 

2 into before the date of enactment of this Act. 

Æ 


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