Document ID: SEC-2020-0067-0001
Agency: sec
Document Type: Notice
Title: Order: Temporary Exemptions from the Exchange Act and Exchange Act Rules in Connection with the Revision of the Definition of Security to Encompass Security-Based Swaps
Posted Date: 2020-01-16T05:00Z

[Federal Register Volume 85, Number 11 (Thursday, January 16, 2020)]
[Notices]
[Pages 2763-2766]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-00568]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-87943; File No. S7-27-11]

Order Extending Temporary Exemptions From Exchange Act Section 8 
and Exchange Act Rules 8c-1, 10b-16, 15a-1, 15c2-1 and 15c2-5 in 
Connection With the Revision of the Definition of ``Security'' To 
Encompass Security-Based Swaps

January 10, 2020.

I. Introduction

    The Securities and Exchange Commission (``Commission'') is 
extending until November 5, 2020, temporary exemptions from Section 8 
\1\ of the Securities Exchange Act of 1934 (``Exchange Act'') and from 
Exchange Act Rules 8c-1, 15c2-1, 10b-16, 15c2-5, and 15a-1 \2\ in 
connection with the revision of the definition of ``security'' to 
encompass security-based swaps. The Commission is granting this nine-
month extension because it believes the temporary exemptions from these 
provisions warrant further consideration to take into account the 
finalized regulatory regime for security-based swap dealers and major 
security-based swap participants, as well as the compliance date for 
registration of those entities.\3\
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    \1\ 15 U.S.C. 78h.
    \2\ 17 CFR 240.8c-1, 240.15c2-1, 240.10b-16, 240.15c2-5 and 
240.15a-1.
    \3\ Because the Commission ultimately may determine not to 
provide permanent exemptions for security-based swaps from one or 
more of these provisions, during the extension market participants 
may wish to consider how they would design and implement appropriate 
compliance measures and controls.
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    These and other temporary exemptions were originally provided by 
the Commission in 2011 and periodically extended by the Commission, 
most recently in January 2019.\4\ The remainder of the temporary 
exemptions extended in January 2019, and not extended in this Order, 
will expire on February 5, 2020.\5\
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    \4\ See Order Granting Temporary Exemptions under the Securities 
Exchange Act of 1934 in Connection with the Pending Revisions of the 
Definition of ``Security'' to Encompass Security-Based Swaps, 
Exchange Act Release No. 64795 (July 1, 2011), 76 FR 39927 (July 7, 
2011) (``2011 Exchange Act Exemptive Order''); see also Further 
Definition of ``Swap,'' ``Security-Based Swap,'' and ``Security-
Based Swap Agreement''; Mixed Swaps; Security-Based Swap Agreement 
Recordkeeping, Exchange Act Release No. 67453 (July 18, 2012), 77 FR 
48207 (Aug. 13, 2012) (extending the expiration date of the 
temporary exemptions to February 11, 2013); Order Extending 
Temporary Exemptions under the Securities Exchange Act of 1934 in 
Connection with the Revision of the Definition of ``Security'' to 
Encompass Security-Based Swaps, and Request for Comment, Exchange 
Act Release No. 68864 (Feb. 7, 2013), 78 FR 10218 (Feb. 13, 2013) 
(extending the expiration date of the temporary exemptions to 
February 11, 2014); Order Extending Temporary Exemptions under the 
Securities Exchange Act of 1934 in Connection with the Revision of 
the Definition of ``Security'' to Encompass Security-Based Swaps, 
and Request for Comment, Exchange Act Release No. 71485 (Feb. 5, 
2014), 79 FR 7731 (Feb. 10, 2014) (``2014 Extension Order'') 
(extending the expiration date for certain temporary exemptions to 
February 5, 2017); Order Extending Certain Temporary Exemptions 
Under the Securities Exchange Act of 1934 in Connection With the 
Revision of the Definition of ``Security'' To Encompass Security-
Based Swaps and Request for Comment, Exchange Act Release No. 79833 
(Jan. 18, 2017), 82 FR 8467 (Jan. 25, 2017) (extending the 
expiration date for certain temporary exemptions to February 5, 
2018); Order Extending Until February 5, 2019 Certain Temporary 
Exemptions under the Securities Exchange Act of 1934 in Connection 
with the Pending Revision of the Definition of ``Security'' to 
Encompass Security-Based Swaps and Request for Comment, Exchange Act 
Release No. 82626 (Feb. 2, 2018), 83 FR 5665 (Feb. 18, 2018) (``2018 
Extension Order'') (extending the expiration date for certain 
temporary exemptions to February 5, 2019); Order Granting a Limited 
Exemption from the Exchange Act Definition of ``Penny Stock'' for 
Security-Based Swap Transactions between Eligible Contract 
Participants; Granting a Limited Exemption from the Exchange Act 
Definition of ``Municipal Securities'' for Security-Based Swaps; and 
Extending Certain Temporary Exemptions under the Exchange Act in 
Connection with the Revision of the Definition of ``Security'' to 
Encompass Security-Based Swaps, Exchange Act Release No. 84991 (Jan. 
25, 2019), 84 FR 863 (Jan. 31, 2019) (``January 2019 Extension 
Order'') (extending the expiration date for certain temporary 
exemptions to February 5, 2020).
    \5\ See January 2019 Extension Order, 84 FR at 864-65.
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II. Discussion

A. Background

    Title VII of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act \6\ amended the definition of ``security'' under the 
Exchange Act to expressly encompass security-based swaps.\7\ The 
expansion of the definition of the term ``security'' to include 
security-based swaps had the effect of changing the scope of the 
Exchange Act regulatory provisions that apply to security-based swaps 
and, in doing so, raised certain complex questions that required 
further consideration.
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    \6\ The Dodd-Frank Wall Street Reform and Consumer Protection 
Act, Public Law 111-203, 124 Stat. 1376 (2010) (``Dodd-Frank Act'').
    \7\ See Section 761(a)(2) of the Dodd-Frank Act (amending 
Section 3(a)(10) of the Exchange Act, 15 U.S.C. 78c(a)(10)). The 
provisions of Title VII generally became effective on July 16, 2011 
(360 days after the enactment of the Dodd-Frank Act) (the 
``Effective Date''), unless a provision required a rulemaking, in 
which case the provision would go into effect ``not less than'' 60 
days after publication of the related final rules in the Federal 
Register or on July 16, 2011, whichever is later. See Section 774 of 
the Dodd-Frank Act, 15 U.S.C. 77b note.
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    In July 2011, the Commission issued an order (the ``2011 Exchange 
Act Exemptive Order''), which granted two relevant temporary exemptions 
from compliance with certain provisions of the Exchange Act, and the 
rules and regulations thereunder. First, the Commission granted to any 
person who meets the definition of ``eligible contract participant'' 
set forth in Section 1a(12) of the Commodity Exchange Act as in effect 
on July 20, 2010 (i.e., the day prior to the date the Dodd-Frank Act 
was signed into law) and who is not a registered broker or dealer \8\ 
or a self-regulatory organization \9\ a temporary exemption from 
certain provisions of the Exchange Act, and the rules and regulations 
thereunder, solely in connection with the person's activities involving 
security-based swaps.\10\ Second, the Commission granted to a broker or 
dealer registered under Section 15(b) of the Exchange Act (other than a 
broker or dealer registered under Section 15(b)(11) of the Exchange 
Act), a temporary exemption from certain provisions of the Exchange 
Act, and the

[[Page 2764]]

rules and regulations thereunder, solely with respect to security-based 
swaps.\11\
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    \8\ This temporary exemption is available to a broker or dealer 
registered under Section 15(b)(11) of the Exchange Act who meets the 
other eligibility criteria for this relief. See 2011 Exchange Act 
Exemptive Order, 76 FR at 39938.
    \9\ This temporary exemption is available to a self-regulatory 
organization in limited circumstances. See 2011 Exchange Act 
Exemptive Order, 76 FR at 39938-39.
    \10\ See 2011 Exchange Act Exemptive Order, 76 FR at 39938-39.
    \11\ See 2011 Exchange Act Exemptive Order, 76 FR at 39939. The 
2011 Exchange Act Exemptive Order did not provide exemptive relief 
for any provisions or rules prohibiting fraud, manipulation, or 
insider trading (other than prophylactic reporting or recordkeeping 
requirements such as the confirmation requirements of Exchange Act 
Rule 10b-10). In addition, the 2011 Exchange Act Exemptive Order did 
not affect the Commission's investigative, enforcement, and 
procedural authority related to those provisions and rules. See 2011 
Exchange Act Exemptive Order, 76 FR at 39931 n.34. The 2011 Exchange 
Act Exemptive Order also did not address Sections 12, 13, 14, 15(d), 
16, and 17A of the Exchange Act and the rules and regulations 
thereunder.
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    The overall approach of the 2011 Exchange Act Exemptive Order was 
directed toward maintaining the status quo during the implementation 
process for the Dodd-Frank Act.\12\ In the 2011 Exchange Act Exemptive 
Order, the Commission stated that it would accomplish this ``by 
preserving the application of particular Exchange Act requirements that 
already are applicable in connection with instruments that will be 
`security-based swaps' following the Effective Date [of the Dodd-Frank 
Act], but deferring the applicability of additional Exchange Act 
requirements in connection with those instruments explicitly being 
defined as `securities' as of the Effective Date.'' \13\
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    \12\ See 2011 Exchange Act Exemptive Order, 76 FR at 39929.
    \13\ 2011 Exchange Act Exemptive Order, 76 FR at 39929. Under 
the 2011 Exchange Act Exemptive Order, instruments that (before the 
Effective Date) were security-based swap agreements and (after the 
Effective Date) constituted security-based swaps were still subject 
to the application of those Exchange Act provisions. See 2011 
Exchange Act Exemptive Order, 76 FR at 39930 nn.24-25.
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1. 2014 Extension Order

    In 2014, the Commission extended the expiration dates for the 
temporary exemptions in the 2011 Exchange Act Exemptive Order.\14\ The 
Commission distinguished between: (1) The temporary exemptions related 
to pending security-based swap rulemakings (``Linked Temporary 
Exemptions''), the expiration dates for which were extended to the 
compliance dates for the specific rulemakings to which they were 
``linked''; and (2) the temporary exemptions that generally were not 
directly related to a specific security-based swap rulemaking 
(``Unlinked Temporary Exemptions''), the expiration date for which was 
extended to the earlier of three years following the effective date of 
the 2014 Extension Order (i.e., February 5, 2017) or such time that the 
Commission issues an order or rule determining whether continuing 
exemptive relief is appropriate for security-based swaps with respect 
to any such Unlinked Temporary Exemptions.\15\ This approach was 
designed to provide the Commission with flexibility, while its Dodd-
Frank Act rulemaking is still in progress, to determine whether 
continuing relief should be provided for any of the Unlinked Temporary 
Exemptions.\16\
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    \14\ See 2014 Extension Order, 79 FR at 7734-35.
    \15\ See 2014 Extension Order, 79 FR at 7732-35.
    \16\ See 2014 Extension Order, 79 FR at 7731. The 2014 Extension 
Order referred to the temporary exemptions provided for in the 2011 
Exchange Act Exemptive Order as the ``Expiring Temporary 
Exemptions'' and noted that the 2011 Exchange Act Exemptive Order 
generally provided for the following exemptions from the Exchange 
Act: ``(a) temporary exemptions in connection with security-based 
swap activity by certain `eligible contract participants'; and (b) 
temporary exemptions specific to security-based swap activities by 
registered brokers and dealers.''
    The 2014 Extension Order identified the Linked Temporary 
Exemptions as those Expiring Temporary Exemptions related to: (1) 
Capital and margin requirements applicable to a broker or dealer 
(Exchange Act Sections 7 and 15(c)(3), Regulation T, and Exchange 
Act Rules 15c3-1, 15c3-3, and 15c3-4); (2) recordkeeping 
requirements applicable to a broker or dealer (Exchange Act Sections 
17(a) and 17(b) and Exchange Act Rules 17a-3, 17a-4, 17a-5, 17a-11, 
and 17a-13); (3) registration requirements under Exchange Act 
Section 15(a)(1), and the other requirements of the Exchange Act and 
the rules and regulations thereunder that apply to a ``broker'' or 
``dealer'' that is not registered with the Commission; (4) Exchange 
Act Rule 10b-10; and (5) Regulation ATS. The remaining Expiring 
Temporary Exemptions are the Unlinked Temporary Exemptions.
    As applicable, the Commission extended the Linked Temporary 
Exemptions until the compliance date for pending rulemakings 
concerning: Capital, margin, and segregation requirements for 
security-based swap dealers and major security-based swap 
participants; recordkeeping and reporting requirements for security-
based swap dealers and major security-based swap participants; 
security-based swap trade acknowledgement and verification; and 
registration requirements for security-based swap execution 
facilities. The Linked Temporary Exemptions are not addressed in 
this order and have been, or will be, separately considered in 
connection with the related security-based swap rulemakings. See, 
e.g., Capital, Margin, and Segregation Requirements for Security-
Based Swap Dealers and Major Security-Based Swap Participants and 
Capital and Segregation Requirements for Broker-Dealers, Exchange 
Act Release No. 86175 (June 21, 2019), 84 FR 43872, 43955-56 (Aug. 
22, 2019); Recordkeeping and Reporting Requirements for Security-
Based Swap Dealers, Major Security-Based Swap Participants, and 
Broker-Dealers, Exchange Act Release No. 87005 (Sept. 19 2019), 84 
FR 68550, 68601-02 (Dec. 16, 2019); Trade Acknowledgement and 
Verification of Security-Based Swap Transactions, Exchange Act 
Release No. 78011 (June 8, 2016), 81 FR 39807, 39824-25 n.189 (June 
17, 2016).
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2. 2018 Extension Order and January 2019 Extension Order
    In 2018, the Commission extended the expiration date of the 
Unlinked Temporary Exemptions until February 5, 2019.\17\ The 
Commission also requested comment on whether continuing exemptive 
relief was necessary beyond February 5, 2019.\18\ The Commission 
received four letters from two different commenters in response.\19\ 
One of these comments requested that the Commission make permanent a 
limited number of the Unlinked Temporary Exemptions.\20\ The commenter 
also requested an additional twelve-month transition period before the 
expiration of the remaining Unlinked Temporary Exemptions.\21\ The 
commenter argued that market participants would use the additional time 
to ``further analyze the applicability of [Exchange Act provisions and 
rules] to their [security-based swap] business and design and implement 
appropriate compliance measures, including, where relevant, controls 
designed to prevent or detect activity that might potentially trigger 
these provisions.'' \22\ In response, the Commission provided limited

[[Page 2765]]

exemptions from the definition of ``penny stock'' in Section 3(a)(51) 
of the Exchange Act and Rule 3a51-1 for transactions in security-based 
swaps between eligible contract participants and from the definition of 
``municipal securities'' in Section 3(a)(29) of the Exchange Act for 
security-based swaps.\23\ The Commission also extended the Unlinked 
Temporary Exemptions until February 5, 2020, providing a twelve-month 
transition period to allow market participants adequate time to design 
and implement appropriate compliance measures and controls.\24\
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    \17\ See 2018 Extension Order.
    \18\ Comments received are available at https://www.sec.gov/comments/s7-27-11/s72711.shtml.
    \19\ See letter from Kyle Brandon, Managing Director, SIFMA, 
dated Nov. 8, 2018 (``SIFMA November 2018 Letter'') (requesting that 
the Commission further extend the Unlinked Temporary Exemptions, and 
also requesting certain permanent exemptive and other relief); 
supplemental letter from Kyle Brandon, Managing Director, SIFMA, 
dated Dec. 20, 2018 (``SIFMA December 2018 Letter'') (supplementing 
the SIFMA November 2018 Letter with additional detail regarding the 
Unlinked Temporary Exemptions and recommending a twelve-month 
transition period before expiration of any Unlinked Temporary 
Exemptions); see also letters from Walt L. Lukken, President and 
Chief Executive Officer, Futures Industry Association, dated Nov. 18 
and Nov. 29, 2018 (each expressing support for codifying the 
exemptions for security-based swaps from inapplicable securities 
rules).
    \20\ See SIFMA December 2018 Letter at 3 (request for exemption 
from the definition of ``penny stock''); SIFMA December 2018 Letter 
at 3-4 (request for guidance regarding the definition of ``municipal 
securities''); SIFMA December 2018 Letter at 3-4 (request for 
guidance regarding the definition of ``government securities''); 
SIFMA December 2018 Letter at 4-5 (request for exemption from fees 
under Section 31 of the Exchange Act); SIFMA December 2018 Letter at 
5 (request for exemption from hypothecation requirements); SIFMA 
December 2018 Letter at 5-6 (request for exemption from broker-
dealer disclosure requirements relating to extensions of credit); 
SIFMA December 2018 Letter at 6 (request for exemption from 
qualification requirements for personnel of broker-dealers); SIFMA 
December 2018 Letter at 6 (request for exemption from fingerprinting 
requirements for personnel of broker-dealers); SIFMA December 2018 
Letter at 6-7 (request for exemption to permit OTC derivatives 
dealers to transact in centrally cleared or listed security-based 
swaps); SIFMA December 2018 Letter at 7 (request for exemption to 
permit exchange members to engage in security-based swap 
transactions without losing an existing limited exemption from the 
requirement to be a member of a national securities association); 
SIFMA December 2018 Letter at 7 (request for exemption from audit 
and compensation committee requirements).
    \21\ See SIFMA December 2018 Letter at 1, 7.
    \22\ See SIFMA December 2018 Letter at 7.
    \23\ See January 2019 Extension Order, 84 FR at 867.
     In response to the commenter's request, the Commission noted 
that the Unlinked Temporary Exemptions did not include an exemption 
from the definition of ``government securities'' in Section 3(a)(42) 
of the Exchange Act and noted that the Exchange Act does not permit 
the Commission to provide such relief. The Commission further noted 
that Section 31 fees do not currently apply to security-based swaps 
but that it may revisit the appropriateness of exempting security-
based swaps from Section 31 fees at the time such fees begin to 
apply. See January 2019 Extension Order, 84 FR at 866 & n.40.
    \24\ See January 2019 Extension Order, 84 FR at 866.
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    On January 8, 2020, the Commission received a letter from the same 
commenter supplementing its earlier request.\25\ The commenter updated 
its requests to make permanent the three aspects of the Unlinked 
Temporary Exemptions: (1) Limitations on hypothecation of securities 
carried for the account of a customer in Section 8 of the Exchange Act 
and in Exchange Act Rules 8c-1 and 15c2-1,\26\ (2) broker-dealer 
disclosure requirements relating to extensions of credit in Exchange 
Act Rules 10b-16 and 15c2-5,\27\ and (3) certain limitations on an OTC 
derivatives dealer's activities in Exchange Act Rule 15a-1.\28\ In the 
alternative, the commenter requested that the Commission extend the 
Unlinked Temporary Exemptions relating to these requests for an 
additional twelve months so that the Commission may further consider 
the requests.\29\ The commenter also confirmed that it was no longer 
requesting additional extensions for any other Unlinked Temporary 
Exemptions.\30\
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    \25\ See supplemental letter from Kyle Brandon, Managing 
Director, SIFMA, dated Jan. 8, 2020 (``SIFMA January 2020 Letter'') 
(requesting permanent exemptive relief for security based-swaps from 
Section 8 of the Exchange Act and Exchange Act Rules 8c-1, 10b-16, 
15a-1, 15c2-1 and 15c2-5 and withdrawing previous requests to make 
permanent certain other aspects of the Unlinked Temporary 
Exemptions, including those relating to Sections 15(b)(7), 17(f)(2), 
and 31 of the Exchange Act and Exchange Act Rules 10A-3, 10C-1 15b7-
1, 15b9-1, and 17f-2).
    \26\ See SIFMA January 2020 Letter at 3-4); SIFMA December 2018 
Letter at 5; Exchange Act Section 8, 15 U.S.C. 78h; Exchange Act 
Rule 8c-1, 17 CFR 240.8c-1; Exchange Act Rule 15c2-1, 17 CFR 
240.15c2-1. Section 8 of the Exchange Act and Exchange Act Rules 8c-
1 and 15c2-1 limit a broker-dealer's ability to hypothecate 
securities carried for the account of a customer.
    \27\ See SIFMA January 2020 Letter at 4; SIFMA December 2018 
Letter at 5-6; Exchange Act Rule 10b-16, 17 CFR 240.10b-16; Exchange 
Act Rule 15c2-5, 17 CFR 240.15c2-5. Exchange Act Rules 10b-16 and 
15c2-5 govern the disclosures that a broker-dealer must provide to 
customers to whom they extend credit.
    \28\ See SIFMA January 2020 Letter at 4-5 (requesting relief to 
permit OTC derivatives dealers to transact in centrally cleared or 
listed security-based swaps); SIFMA December 2018 Letter at 6-7; 
Exchange Act Rule 15a-1, 17 CFR 240.15a-1. Exchange Act Rule 15a-1 
limits an OTC derivatives dealer's ability to engage in dealer 
activities in listed instruments and in fungible instruments that 
are standardized as to their material economic terms.
    \29\ See SIFMA January 2020 Letter at 2-3.
    \30\ See SIFMA January 2020 Letter at 5.
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B. Temporary Exemptions

    The Commission has finalized a majority of the rulemakings under 
Title VII of the Dodd-Frank Act.\31\ Specifically, the Commission has 
finalized the registration and regulatory regime for security-based 
swap dealers and major security-based swap participants and set the 
compliance date for registration of those entities (``Registration 
Compliance Date''). The Commission believes that it would be 
appropriate to provide market participants limited additional time to 
consider the impact of the expiration of the Unlinked Temporary 
Exemptions, with respect to the commenter's three remaining requests.
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    \31\ See, e.g., Regulation SBSR--Reporting and Dissemination of 
Security-Based Swap Information, Exchange Act Release No. 74244 
(Feb. 11, 2015), 80 FR 14563 (Mar. 19, 2015); Security-Based Swap 
Data Repository Registration, Duties, and Core Principles, Exchange 
Act Release No. 74246 (Feb. 11, 2015), 80 FR 14437 (Mar. 19, 2015); 
Registration Process for Security-Based Swap Dealers and Major 
Security-Based Swap Participants, Exchange Act Release No. 75611 
(Aug. 5, 2015), 80 FR 48963 (Aug. 14, 2015); Regulation SBSR--
Reporting and Dissemination of Security-Based Swap Information, 
Exchange Act Release No. 78321 (July 14, 2016), 81 FR 53545 (Aug. 
12, 2016); Applications by Security-Based Swap Dealers or Major 
Security-Based Swap Participants for Statutorily Disqualified 
Associated Person To Effect or Be Involved in Effecting Security-
Based Swaps, Exchange Act Release No. 84858 (Dec. 19, 2018), 84 FR 
4906 (Feb. 19, 2019); Capital, Margin, and Segregation Requirements 
for Security-Based Swap Dealers and Major Security-Based Swap 
Participants and Capital and Segregation Requirements for Broker-
Dealers, Exchange Act Release No. 86175 (June 21, 2019), 84 FR 43872 
(Aug. 22, 2019); Recordkeeping and Reporting Requirements for 
Security-Based Swap Dealers, Major Security-Based Swap Participants, 
and Broker-Dealers, Exchange Act Release No. 87005 (Sept. 19, 2019), 
84 FR 68550 (Dec. 16, 2019); Rule Amendments and Guidance Addressing 
Cross-Border Application of Certain Security-Based Swap 
Requirements, Exchange Act Release No. 87780 (Dec. 18, 2019).
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    The Commission is extending, for a further nine months, the 
Unlinked Temporary Exemptions that relate to three requests for 
permanent exemptions for security-based swaps from limitations on 
hypothecation of securities carried for the account of a customer in 
Section 8 of the Exchange Act and in Exchange Act Rules 8c-1 and 15c2-
1, from broker-dealer disclosure requirements relating to extensions of 
credit in Exchange Act Rules 10b-16 and 15c2-5, and from certain 
limitations on an OTC derivatives dealer's activities in Exchange Act 
Rule 15a-1. This additional time extends the transition period for the 
Exchange Act provisions and rules relevant to these three requests to 
allow time to further consider the requests taking into account the 
finalized regulatory regime for security-based swap dealers and major 
security-based swap participants, as well as the compliance date for 
registration of those entities.\32\ The Commission believes that an 
additional nine months will provide sufficient time for this further 
consideration.
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    \32\ See note 3, supra.
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    The Commission is not extending any other of the Unlinked Temporary 
Exemptions.\33\ The Commission continues to believe that market 
participants will have had adequate time to consider the impact of the 
expiration of the remainder of the Unlinked Temporary Exemptions when 
they expire on February 5, 2020.
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    \33\ As always, the Commission may, however, consider tailored 
relief in the future under particular facts and circumstances.
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III. Commission Findings

    Accordingly, pursuant to its authority under Section 36 of the 
Exchange Act, the Commission finds that it is necessary or appropriate 
in the public interest, and consistent with the protection of 
investors, to extend for a period of nine months, until November 5, 
2020, the Unlinked Temporary Exemptions from Section 8 of the Exchange 
Act and from Exchange Act Rules 8c-1, 15c2-1, 10b-16, 15c2-5, and 15a-
1, in connection with the revision of the Exchange Act definition of 
``security'' to encompass security-based swaps, in each case contained 
in the 2011 Exchange Act Exemptive Order and extended in the January 
2019 Extension Order. This extension will allow time to further 
consider the requests taking into account the finalized regulatory 
regime for security-based swap dealers and major security-based swap 
participants, as well as the

[[Page 2766]]

compliance date for the registration of those entities.
    The remainder of the Unlinked Temporary Exemptions will expire on 
February 5, 2020, as provided in the January 2019 Extension Order.
* * * * *

IV. Conclusion

    It is hereby ordered, pursuant to Section 36 of the Exchange Act, 
that the Unlinked Temporary Exemptions from Section 8 of the Exchange 
Act and from Exchange Act Rules 8c-1, 15c2-1, 10b-16, 15c2-5 and 15a-1 
in connection with the revision of the Exchange Act definition of 
``security'' to encompass security-based swaps, in each case contained 
in the 2011 Exchange Act Exemptive Order and extended in the January 
2019 Extension Order, are extended until November 5, 2020.

    By the Commission.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2020-00568 Filed 1-15-20; 8:45 am]
 BILLING CODE 8011-01-P