I 

112TH CONGRESS 

1ST SESSION H. R. 3283 

To amend the Commodity Exchange Act and the Securities Exchange Act 

of 1934 to provide an exemption for certain swaps and security-based 

swaps involving non-U.S. persons, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

OCTOBER 31, 2011 

Mr. HIMES (for himself and Mr. GARRETT) introduced the following bill; 

which was referred to the Committee on Financial Services, and in addition to the Committee on Agriculture, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions 

as fall within the jurisdiction of the committee concerned 

A BILL 

To amend the Commodity Exchange Act and the Securities 

Exchange Act of 1934 to provide an exemption for certain swaps and security-based swaps involving non-U.S. 

persons, 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 ‘‘Swap Jurisdiction Cer5 tainty Act’’. 


srobinson on DSK4SPTVN1PROD with BILLS
2 

•HR 3283 IH

1 SEC. 2. COMMODITY EXCHANGE ACT. 

2 Section 4s(a) of the Commodity Exchange Act (7 

3 U.S.C. 6s(a)) is amended by adding at the end the fol4 lowing: 

5 ‘‘(3) EXTRA-TERRITORIAL SWAP TRANSACTION

6 APPLICATION OF TITLE VII.— 

7 ‘‘(A) IN GENERAL.—A swap entered into 

8 between— 

9 ‘‘(i) a swap dealer that is registered 

10 with the Commission who is either— 

11 ‘‘(I) a U.S. person, or 

12 ‘‘(II) a person that has a parent 

13 company that is a U.S. person, and 

14 ‘‘(ii) a person who is— 

15 ‘‘(I) a U.S. or non-U.S. sub16 sidiary, branch, or affiliate of such 

17 swap dealer, or 

18 ‘‘(II) any other non-U.S. person 

19 that is not registered as a swap dealer 

20 with the Commission, 

21 shall not be subject to the provisions of 

22 title VII of the Dodd-Frank Wall Street 

23 Reform and Consumer Protection Act, and 

24 of amendments added by such title, so long 

25 as each swap dealer described under clause 


srobinson on DSK4SPTVN1PROD with BILLS
3 

•HR 3283 IH

1 (i) reports such swap to a swap data repos2 itory registered with the Commission. 

3 ‘‘(B) SWAPS ENTERED INTO BY REG4 ISTERED NON-U.S. PERSONS.— 

5 ‘‘(i) IN GENERAL.—A non-U.S. person 

6 that registers as a swap dealer with the 

7 Commission shall only be subject to the re8 quirements of title VII of the Dodd-Frank 

9 Wall Street Reform and Consumer Protec10 tion Act, and of amendments added by 

11 such title, with respect to swaps that such 

12 person enters into with a U.S. person who 

13 is not a U.S. subsidiary, branch, or affil14 iate of such non-U.S. person. 

15 ‘‘(ii) CAPITAL REQUIREMENTS.—A 

16 non-U.S. person that registers as a swap 

17 dealer with the Commission shall be per18 mitted by the Commission to comply with 

19 the capital requirements under subsection 

20 (e) by complying with comparable require21 ments established by the appropriate gov22 ernmental authorities in the home country 

23 of the non-U.S. person, so long as such 

24 home country is a signatory to the Basel 

25 Accords. 


srobinson on DSK4SPTVN1PROD with BILLS
4 

•HR 3283 IH

1 ‘‘(C) NON-U.S. PERSON.—For purposes of 

2 this paragraph, the term ‘non-U.S. person’ in3 cludes— 

4 ‘‘(i) any person that is not a U.S. per5 son; 

6 ‘‘(ii) any discretionary account or 

7 similar account (other than an estate or 

8 trust) held for the benefit or account of a 

9 non-U.S. person by a dealer or other pro10 fessional fiduciary organized, incorporated, 

11 or (if an individual) resident in the United 

12 States; 

13 ‘‘(iii) any agency or branch of a U.S. 

14 person located outside the United States 

15 if— 

16 ‘‘(I) the agency or branch oper17 ates for valid business reasons; and 

18 ‘‘(II) the agency or branch is en19 gaged in the business of insurance or 

20 banking and is subject to substantive 

21 insurance or banking regulation, re22 spectively, in the jurisdiction where it 

23 is located; 


srobinson on DSK4SPTVN1PROD with BILLS
5 

•HR 3283 IH

1 ‘‘(iv) any trust of which any profes2 sional fiduciary acting as trustee is a U.S. 

3 person, if— 

4 ‘‘(I) a trustee who is a non-U.S. 

5 person has sole or shared investment 

6 discretion with respect to the trust as7 sets; and 

8 ‘‘(II) no beneficiary of the trust 

9 (and no settlor if the trust is rev10 ocable) is a U.S. person; 

11 ‘‘(v) an employee benefit plan estab12 lished and administered in accordance with 

13 the law, customary practices, and docu14 mentation of a country other than the 

15 United States; and 

16 ‘‘(vi) the International Monetary 

17 Fund, the International Bank for Recon18 struction and Development, the Inter19 American Development Bank, the Asian 

20 Development Bank, the African Develop21 ment Bank, the United Nations, a central 

22 bank or its functional equivalent which is 

23 located in a non-U.S. jurisdiction and that 

24 is a signatory to the Basel Accords, and 

25 their agencies, affiliates and pension plans, 


srobinson on DSK4SPTVN1PROD with BILLS
6 

•HR 3283 IH

1 and any other similar international organi2 zations, their agencies, affiliates and pen3 sion plans. 

4 ‘‘(D) U.S. PERSON.—For purposes of this 

5 paragraph, the term ‘U.S. person’ includes— 

6 ‘‘(i) any natural person resident in the 

7 United States; 

8 ‘‘(ii) any partnership or corporation 

9 organized or incorporated under the laws 

10 of the United States; 

11 ‘‘(iii) any estate of which any executor 

12 or administrator is a U.S. person; 

13 ‘‘(iv) any trust of which any trustee is 

14 a U.S. person; 

15 ‘‘(v) any agency or branch of a for16 eign entity located in the United States; 

17 ‘‘(vi) any non-discretionary account or 

18 similar account (other than an estate or 

19 trust) held by a dealer or other fiduciary 

20 for the benefit or account of a United 

21 States person; 

22 ‘‘(vii) any discretionary account or 

23 similar account (other than an estate or 

24 trust) held by a dealer or other fiduciary 


srobinson on DSK4SPTVN1PROD with BILLS
7 

•HR 3283 IH

1 organized, incorporated, or (if an indi2 vidual) resident in the United States; and 

3 ‘‘(viii) any partnership or corpora4 tion— 

5 ‘‘(I) organized or incorporated 

6 under the laws of any foreign jurisdic7 tion; and 

8 ‘‘(II) formed by a U.S. person 

9 principally for the purpose of invest10 ing in securities not registered under 

11 the Securities Act of 1933, unless it is 

12 organized or incorporated, and owned, 

13 by accredited investors (as such term 

14 is defined under section 230.501 of 

15 title 17, Code of Federal Regulations) 

16 that are not natural persons, estates, 

17 or trusts. 

18 ‘‘(E) ANTI-EVASION.—Notwithstanding 

19 any other provision of this paragraph, each reg20 istered swap dealer shall be subject to the pro21 vision under section 2(i)(2).’’. 

22 SEC. 3. SECURITIES EXCHANGE ACT OF 1934. 

23 Section 15F(a) of the Securities Exchange Act of 

24 1934 (78o–10(a)) is amended by adding at the end the 

25 following: 


srobinson on DSK4SPTVN1PROD with BILLS
8 

•HR 3283 IH

1 ‘‘(3) EXTRA-TERRITORIAL SWAP TRANSACTION

2 APPLICATION OF TITLE VII.— 

3 ‘‘(A) IN GENERAL.—A security-based swap 

4 entered into between— 

5 ‘‘(i) a security-based swap dealer that 

6 is registered with the Commission who is 

7 either— 

8 ‘‘(I) a U.S. person, or 

9 ‘‘(II) a person that has a parent 

10 company that is a U.S. person, and 

11 ‘‘(ii) a person who is— 

12 ‘‘(I) a U.S. or non-U.S. sub13 sidiary, branch, or affiliate of such se14 curity-based swap dealer, or 

15 ‘‘(II) any other non-U.S. person 

16 that is not registered as a security17 based swap dealer with the Commis18 sion, 

19 shall not be subject to the provisions of 

20 title VII of the Dodd-Frank Wall Street 

21 Reform and Consumer Protection Act, and 

22 of amendments added by such title, so long 

23 as each security-based swap dealer de24 scribed under clause (i) reports such secu25 rity-based swap to a security-based swap 


srobinson on DSK4SPTVN1PROD with BILLS
9 

•HR 3283 IH

1 data repository registered with the Com2 mission. 

3 ‘‘(B) SECURITY-BASED SWAPS ENTERED

4 INTO BY REGISTERED NON-U.S. PERSONS.— 

5 ‘‘(i) IN GENERAL.—A non-U.S. person 

6 that registers as a security-based swap 

7 dealer with the Commission shall only be 

8 subject to the requirements of title VII of 

9 the Dodd-Frank Wall Street Reform and 

10 Consumer Protection Act, and of amend11 ments added by such title, with respect to 

12 security-based swaps that such person en13 ters into with a U.S. person who is not a 

14 U.S. subsidiary, branch, or affiliate of such 

15 non-U.S. person. 

16 ‘‘(ii) CAPITAL REQUIREMENTS.—A 

17 non-U.S. person that registers as a secu18 rity-based swap dealer with the Commis19 sion shall be permitted by the Commission 

20 to comply with the capital requirements 

21 under subsection (e) by complying with 

22 comparable requirements established by 

23 the appropriate governmental authorities 

24 in the home country of the non-U.S. perVerDate Mar 15 2010 22:02 Oct 31, 2011 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H3283.IH H3283

srobinson on DSK4SPTVN1PROD with BILLS
10 

•HR 3283 IH

1 son, so long as such home country is a sig2 natory to the Basel Accords. 

3 ‘‘(C) NON-U.S. PERSON.—For purposes of 

4 this paragraph, the term ‘non-U.S. person’ in5 cludes— 

6 ‘‘(i) any person that is not a U.S. per7 son; 

8 ‘‘(ii) any discretionary account or 

9 similar account (other than an estate or 

10 trust) held for the benefit or account of a 

11 non-U.S. person by a dealer or other pro12 fessional fiduciary organized, incorporated, 

13 or (if an individual) resident in the United 

14 States; 

15 ‘‘(iii) any agency or branch of a U.S. 

16 person located outside the United States 

17 if— 

18 ‘‘(I) the agency or branch oper19 ates for valid business reasons; and 

20 ‘‘(II) the agency or branch is en21 gaged in the business of insurance or 

22 banking and is subject to substantive 

23 insurance or banking regulation, re24 spectively, in the jurisdiction where it 

25 is located; 


srobinson on DSK4SPTVN1PROD with BILLS
11 

•HR 3283 IH

1 ‘‘(iv) any trust of which any profes2 sional fiduciary acting as trustee is a U.S. 

3 person, if— 

4 ‘‘(I) a trustee who is a non-U.S. 

5 person has sole or shared investment 

6 discretion with respect to the trust as7 sets; and 

8 ‘‘(II) no beneficiary of the trust 

9 (and no settlor if the trust is rev10 ocable) is a U.S. person; 

11 ‘‘(v) an employee benefit plan estab12 lished and administered in accordance with 

13 the law, customary practices, and docu14 mentation of a country other than the 

15 United States; and 

16 ‘‘(vi) the International Monetary 

17 Fund, the International Bank for Recon18 struction and Development, the Inter19 American Development Bank, the Asian 

20 Development Bank, the African Develop21 ment Bank, the United Nations, a central 

22 bank or its functional equivalent which is 

23 located in a non-U.S. jurisdiction and that 

24 is a signatory to the Basel Accords, and 

25 their agencies, affiliates and pension plans, 


srobinson on DSK4SPTVN1PROD with BILLS
12 

•HR 3283 IH

1 and any other similar international organi2 zations, their agencies, affiliates and pen3 sion plans. 

4 ‘‘(D) U.S. PERSON.—For purposes of this 

5 paragraph, the term ‘U.S. person’ includes— 

6 ‘‘(i) any natural person resident in the 

7 United States; 

8 ‘‘(ii) any partnership or corporation 

9 organized or incorporated under the laws 

10 of the United States; 

11 ‘‘(iii) any estate of which any executor 

12 or administrator is a U.S. person; 

13 ‘‘(iv) any trust of which any trustee is 

14 a U.S. person; 

15 ‘‘(v) any agency or branch of a for16 eign entity located in the United States; 

17 ‘‘(vi) any non-discretionary account or 

18 similar account (other than an estate or 

19 trust) held by a dealer or other fiduciary 

20 for the benefit or account of a United 

21 States person; 

22 ‘‘(vii) any discretionary account or 

23 similar account (other than an estate or 

24 trust) held by a dealer or other fiduciary 


srobinson on DSK4SPTVN1PROD with BILLS
13 

•HR 3283 IH

1 organized, incorporated, or (if an indi2 vidual) resident in the United States; and 

3 ‘‘(viii) any partnership or corpora4 tion— 

5 ‘‘(I) organized or incorporated 

6 under the laws of any foreign jurisdic7 tion; and 

8 ‘‘(II) formed by a U.S. person 

9 principally for the purpose of invest10 ing in securities not registered under 

11 the Securities Act of 1933, unless it is 

12 organized or incorporated, and owned, 

13 by accredited investors (as such term 

14 is defined under section 230.501 of 

15 title 17, Code of Federal Regulations) 

16 that are not natural persons, estates, 

17 or trusts. 

18 ‘‘(E) ANTI-EVASION.—Notwithstanding 

19 any other provision of this paragraph, a reg20 istered security-based swap dealer shall not con21 duct any activities that are designed to evade 

22 any provision of this Act that was enacted by 

23 the Wall Street Transparency and Account24 ability Act of 2010.’’. 

Æ 


srobinson on DSK4SPTVN1PROD with BILLS