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(B) with regard to its activities or functions 
concerning swaps— 
(i) swap dealers; 
(ii) major swap participants; 
(iii) swap data repositories; 
(iv) persons associated with a swap 
dealer or major swap participant; 
(v) eligible contract participants with 
respect to swaps; or 
(vi) swap execution facilities with re-
spect to swaps. 
(3) PROHIBITION ON CERTAIN FUTURES ASSO-
CIATIONS
AND
NATIONAL
SECURITIES
ASSOCIA-
TIONS.— 
(A) 
FUTURES
ASSOCIATIONS.—Notwith-
standing any other provision of law (including 
regulations), unless otherwise authorized by this 
title, no futures association registered under sec-
tion 17 of the Commodity Exchange Act (7 
U.S.C. 21) may issue a rule, regulation, or order 
for the oversight or regulation of, or otherwise as-
sert jurisdiction over, for any purpose, any secu-
rity-based swap, except that this shall not limit 
the authority of a national futures association to
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† HR 4173 EAS 
examine for compliance with and enforce its 
rules on advertising and capital adequacy. 
(B) 
NATIONAL
SECURITIES
ASSOCIA-
TIONS.—Notwithstanding any other provision of 
law (including regulations), unless otherwise au-
thorized by this title, no national securities asso-
ciation registered under section 15A of the Secu-
rities Exchange Act of 1934 (15 U.S.C. 78o–3) 
may issue a rule, regulation, or order for the 
oversight or regulation of, or otherwise assert ju-
risdiction over, for any purpose, any swap, ex-
cept that this shall not limit the authority of a 
national securities association to examine for 
compliance with and enforce its rules on adver-
tising and capital adequacy. 
(c) OBJECTION TO COMMISSION REGULATION.— 
(1) FILING OF PETITION FOR REVIEW.— 
(A) IN GENERAL.—If either Commission re-
ferred to in this section determines that a final 
rule, regulation, or order of the other Commis-
sion conflicts with subsection (a)(4) or (b), then 
the complaining Commission may obtain review 
of the final rule, regulation, or order in the 
United States Court of Appeals for the District 
of Columbia Circuit by filing in the court, not
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† HR 4173 EAS 
later than 60 days after the date of publication 
of the final rule, regulation, or order, a written 
petition requesting that the rule, regulation, or 
order be set aside. 
(B) 
EXPEDITED
PROCEEDING.—A 
pro-
ceeding described in subparagraph (A) shall be 
expedited by the United States Court of Appeals 
for the District of Columbia Circuit. 
(2) TRANSMITTAL OF PETITION AND RECORD.— 
(A) IN GENERAL.—A copy of a petition de-
scribed in paragraph (1) shall be transmitted not 
later than 1 business day after the date of filing 
by the complaining Commission to the Secretary 
of the responding Commission. 
(B) DUTY OF RESPONDING COMMISSION.— 
On receipt of the copy of a petition described in 
paragraph (1), the responding Commission shall 
file with the United States Court of Appeals for 
the District of Columbia Circuit— 
(i) a copy of the rule, regulation, or 
order under review (including any docu-
ments referred to therein); and 
(ii) any other materials prescribed by 
the United States Court of Appeals for the 
District of Columbia Circuit.
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(3) STANDARD OF REVIEW.—The United States 
Court of Appeals for the District of Columbia Circuit 
shall— 
(A) give deference to the views of neither 
Commission; and 
(B) determine to affirm or set aside a rule, 
regulation, or order of the responding Commis-
sion under this subsection, based on the deter-
mination of the court as to whether the rule, reg-
ulation, or order is in conflict with subsection 
(a)(4) or (b), as applicable. 
(4) JUDICIAL STAY.—The filing of a petition by 
the complaining Commission pursuant to paragraph 
(1) shall operate as a stay of the rule, regulation, or 
order until the date on which the determination of the 
United States Court of Appeals for the District of Co-
lumbia Circuit is final (including any appeal of the 
determination). 
(d) ADOPTION OF RULES ON UNCLEARED SWAPS.— 
Notwithstanding subsections (b) and (c), the Commodity 
Futures Trading Commission and the Securities and Ex-
change Commission shall, after consulting with each other 
Commission, adopt rules— 
(1) to require the maintenance of records of all 
activities relating to transactions in swaps and secu-
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† HR 4173 EAS 
rity-based swaps under the respective jurisdictions of 
the Commodity Futures Trading Commission and the 
Securities and Exchange Commission that are 
uncleared; 
(2) to make available, consistent with section 8 
of the Commodity Exchange Act (7 U.S.C. 12), to the 
Securities and Exchange Commission information re-
lating to swaps transactions that are uncleared; and 
(3) to make available to the Commodity Futures 
Trading Commission information relating to secu-
rity-based swaps transactions that are uncleared. 
(e) DEFINITIONS.—Notwithstanding subsections (b) 
and (c), the Commodity Futures Trading Commission and 
the Securities and Exchange Commission shall jointly 
adopt rules to define the term ‘‘security-based swap agree-
ment’’ in section 1a(47)(A)(v) of the Commodity Exchange 
Act (7 U.S.C. 1a(47)(A)(v)) and in section 3(a)(78) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(78)). 
(f) GLOBAL RULEMAKING TIMEFRAME.—Unless other-
wise provided in a particular provision of this title, or an 
amendment made by this title, the Commodity Futures 
Trading Commission or the Securities and Exchange Com-
mission, or both, shall individually, and not jointly, pro-
mulgate rules and regulations required of each Commission
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† HR 4173 EAS 
under this title or an amendment made by this title not 
later than 180 days after the date of enactment of this Act. 
(g) EXPEDITED RULEMAKING PROCESS.—The Com-
modity Futures Trading Commission or the Securities and 
Exchange Commission, or both, may use emergency and ex-
pedited procedures (including any administrative or other 
procedure as appropriate) to carry out this title and the 
amendments made by this title if, in either of the Commis-
sions’ discretion, it considers it necessary to do so. 
SEC. 713. RECOMMENDATIONS FOR CHANGES TO PORT-
FOLIO MARGINING LAWS. 
Not later than 180 days after the date of enactment 
of this Act, the Securities and Exchange Commission, the 
Commodity Futures Trading Commission, and the pruden-
tial regulators shall submit to the appropriate committees 
of Congress recommendations for legislative changes to the 
Federal laws to facilitate the portfolio margining of securi-
ties and commodity futures and options, commodity op-
tions, swaps, and other financial instrument positions. 
SEC. 714. ABUSIVE SWAPS. 
The Commodity Futures Trading Commission or the 
Securities and Exchange Commission, or both, individually 
may, by rule or order— 
(1) collect information as may be necessary con-
cerning the markets for any types of—
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† HR 4173 EAS 
(A) swap (as defined in section 1a of the 
Commodity Exchange Act (7 U.S.C. 1a)); or 
(B) security-based swap (as defined in sec-
tion 1a of the Commodity Exchange Act (7 
U.S.C. 1a)); and 
(2) issue a report with respect to any types of 
swaps or security-based swaps that the Commodity 
Futures Trading Commission or the Securities and 
Exchange Commission determines to be detrimental 
to— 
(A) the stability of a financial market; or 
(B) participants in a financial market. 
SEC. 715. AUTHORITY TO PROHIBIT PARTICIPATION IN 
SWAP ACTIVITIES. 
Except as provided in section 4 of the Commodity Ex-
change Act (7 U.S.C. 6) (as amended by section 738), if 
the Commodity Futures Trading Commission or the Securi-
ties and Exchange Commission determines that the regula-
tion of swaps or security-based swaps markets in a foreign 
country undermines the stability of the United States fi-
nancial system, either Commission, in consultation with the 
Secretary of the Treasury, may prohibit an entity domi-
ciled in the foreign country from participating in the 
United States in any swap or security-based swap activi-
ties.
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† HR 4173 EAS 
SEC. 716. PROHIBITION AGAINST FEDERAL GOVERNMENT 
BAILOUTS OF SWAPS ENTITIES. 
(a) PROHIBITION
ON FEDERAL ASSISTANCE.—Not-
withstanding any other provision of law (including regula-
tions), no Federal assistance may be provided to any swaps 
entity with respect to any swap, security-based swap, or 
other activity of the swaps entity. 
(b) DEFINITIONS.—In this section: 
(1) FEDERAL ASSISTANCE.—The term ‘‘Federal 
assistance’’ means the use of any funds, including ad-
vances from any Federal Reserve credit facility, dis-
count window, or pursuant to the third undesignated 
paragraph of section 13 of the Federal Reserve Act 
(12 U.S.C. 343) (relating to emergency lending au-
thority), Federal Deposit Insurance Corporation in-
surance, or guarantees for the purpose of— 
(A) making any loan to, or purchasing any 
stock, equity interest, or debt obligation of, any 
swaps entity; 
(B) purchasing the assets of any swaps enti-
ty; 
(C) guaranteeing any loan or debt issuance 
of any swaps entity; or 
(D) entering into any assistance arrange-
ment (including tax breaks), loss sharing, or 
profit sharing with any swaps entity.
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† HR 4173 EAS 
(2) SWAPS ENTITY.—The term ‘‘swaps entity’’ 
means any swap dealer, security-based swap dealer, 
major swap participant, major security-based swap 
participant, swap execution facility, designated con-
tract market, national securities exchange, central 
counterparty, clearing house, clearing agency, or de-
rivatives clearing organization that is registered 
under— 
(A) the Commodity Exchange Act (7 U.S.C. 
1 et seq.); 
(B) the Securities Exchange Act of 1934 (15 
U.S.C. 78a et seq.); or 
(C) any other Federal or State law (includ-
ing regulations). 
SEC. 717. NEW PRODUCT APPROVAL—CFTC—SEC PROCESS. 
(a) AMENDMENTS
TO
THE COMMODITY EXCHANGE 
ACT.—Section 2(a)(1)(C) of the Commodity Exchange Act 
(7 U.S.C. 2(a)(1)(C)) is amended— 
(1) in clause (i) by striking ‘‘This’’ and insert-
ing ‘‘(I) Except as provided in subclause (II), this’’; 
and 
(2) by adding at the end of clause (i) the fol-
lowing: 
‘‘(II) This Act shall apply to and 
the Commission shall have jurisdiction
507 
† HR 4173 EAS 
with respect to accounts, agreements, 
and transactions involving, and may 
permit the listing for trading pursuant 
to section 5c(c) of, a put, call, or other 
option on 1 or more securities (as de-
fined in section 2(a)(1) of the Securi-
ties Act of 1933 or section 3(a)(10) of 
the Securities Exchange Act of 1934 on 
the date of enactment of the Futures 
Trading Act of 1982), including any 
group or index of such securities, or 
any interest therein or based on the 
value thereof, that is exempted by the 
Securities and Exchange Commission 
pursuant to section 36(a)(1) of the Se-
curities Exchange Act of 1934 with the 
condition that the Commission exercise 
concurrent jurisdiction over such put, 
call, or other option; provided, how-
ever, that nothing in this paragraph 
shall be construed to affect the jurisdic-
tion and authority of the Securities 
and Exchange Commission over such 
put, call, or other option.’’.
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† HR 4173 EAS 
(b) AMENDMENT TO THE SECURITIES EXCHANGE ACT 
OF 1934.—The Securities Exchange Act of 1934 is amended 
by adding the following section after section 3A (15 U.S.C. 
78c–1): 
‘‘SEC. 3B. SECURITIES-RELATED DERIVATIVES. 
‘‘(a) Any agreement, contract, or transaction (or class 
thereof) that is exempted by the Commodity Futures Trad-
ing Commission pursuant to section 4(c)(1) of the Com-
modity Exchange Act (7 U.S.C. 6(c)(1)) with the condition 
that the Commission exercise concurrent jurisdiction over 
such agreement, contract, or transaction (or class thereof) 
shall be deemed a security for purposes of the securities 
laws. 
‘‘(b) With respect to any agreement, contract, or trans-
action (or class thereof) that is exempted by the Commodity 
Futures Trading Commission pursuant to section 4(c)(1) 
of the Commodity Exchange Act (7 U.S.C. 6(c)(1)) with the 
condition that the Commission exercise concurrent jurisdic-
tion over such agreement, contract, or transaction (or class 
thereof), references in the securities laws to the ‘purchase’ 
or ‘sale’ of a security shall be deemed to include the execu-
tion, termination (prior to its scheduled maturity date), as-
signment, exchange, or similar transfer or conveyance of, 
or extinguishing of rights or obligations under such agree-
ment, contract, or transaction, as the context may require.’’.
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† HR 4173 EAS 
(c) AMENDMENT TO SECURITIES EXCHANGE ACT OF 
1934.—Section 19(b) of the Securities Exchange Act of 1934 
(15 U.S.C. 78s(b)) is amended by adding at the end the 
following: 
‘‘(10) Notwithstanding the provisions of para-
graph (2), the time period within which the Commis-
sion is required by order to approve a proposed rule 
change or institute proceedings to determine whether 
the proposed rule change should be disapproved is 
stayed pending a determination by the Commission 
upon the request of the Commodity Futures Trading 
Commission or its Chairman that the Commission 
issue a determination as to whether a product that is 
the subject of such proposed rule change is a security 
pursuant to section 718 of the Wall Street Trans-
parency and Accountability Act of 2010.’’. 
(d) AMENDMENT TO COMMODITY EXCHANGE ACT.— 
Section 5c(c)(1) of the Commodity Exchange Act (7 U.S.C. 
7a–2(c)(1)) is amended— 
(1) by striking ‘‘Subject to paragraph (2)’’ and 
inserting the following: 
‘‘(A) ELECTION.—Subject to paragraph 
(2)’’; and 
(2) by adding at the end the following:
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† HR 4173 EAS 
‘‘(B) CERTIFICATION.—The certification of 
a product pursuant to this paragraph shall be 
stayed pending a determination by the Commis-
sion upon the request of the Securities and Ex-
change Commission or its Chairman that the 
Commission issue a determination as to whether 
the product that is the subject of such certifi-
cation is a contract of sale of a commodity for 
future delivery, an option on such a contract, or 
an option on a commodity pursuant to section 
718 of the Wall Street Transparency and Ac-
countability Act of 2010.’’. 
SEC. 718. DETERMINING STATUS OF NOVEL DERIVATIVE 
PRODUCTS. 
(a) PROCESS FOR DETERMINING THE STATUS OF A 
NOVEL DERIVATIVE PRODUCT.— 
(1) NOTICE.— 
(A) IN GENERAL.—Any person filing a pro-
posal to list or trade a novel derivative product 
that may have elements of both securities and 
contracts of sale of a commodity for future deliv-
ery (or options on such contracts or options on 
commodities) may concurrently provide notice 
and furnish a copy of such filing with both the 
Securities and Exchange Commission and the
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† HR 4173 EAS 
Commodity Futures Trading Commission. Any 
such notice shall state that notice has been made 
with both Commissions. 
(B) NOTIFICATION.—If no concurrent notice 
is made pursuant to subparagraph (A), within 5 
business days after determining that a proposal 
that seeks to list or trade a novel derivative 
product may have elements of both securities and 
contracts of sale of a commodity for future deliv-
ery (or options on such contracts or options on 
commodities), the Securities and Exchange Com-
mission or the Commodity Futures Trading 
Commission, as applicable, shall notify the other 
Commission and provide a copy of such filing to 
the other Commission. 
(2) REQUEST FOR DETERMINATION.— 
(A) IN GENERAL.—No later than 21 days 
after receipt of a notice under paragraph (1), or 
upon its own initiative if no such notice is re-
ceived, the Commodity Futures Trading Com-
mission may request that the Securities and Ex-
change Commission issue a determination as to 
whether a product is a security, as defined in 
section 3(a)(10) of the Securities Exchange Act 
of 1934 (15 U.S.C. 78c(a)(10)).
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† HR 4173 EAS 
(B) REQUEST.—No later than 21 days after 
receipt of a notice under paragraph (1), or upon 
its own initiative if no such notice is received, 
the Securities and Exchange Commission may 
request that the Commodity Futures Trading 
Commission issue a determination as to whether 
a product is a contract of sale of a commodity 
for future delivery, an option on such a contract, 
or an option on a commodity subject to the Com-
modity Futures Trading Commission’s exclusive 
jurisdiction under section 2(a)(1)(A) of the Com-
modity Exchange Act (7 U.S.C. 2(a)(1)(A)). 
(C) 
REQUIREMENT
RELATING
TO
RE-
QUEST.—A request under subparagraph (A) or 
(B) shall be made by submitting such request, in 
writing, to the Securities and Exchange Com-
mission or the Commodity Futures Trading 
Commission, as applicable. 
(D) EFFECT.—Nothing in this paragraph 
shall be construed to prevent— 
(i) the Commodity Futures Trading 
Commission from requesting that the Secu-
rities and Exchange Commission grant an 
exemption pursuant to section 36(a)(1) of 
the Securities Exchange Act of 1934 (15
513 
† HR 4173 EAS 
U.S.C. 78mm(a)(1)) with respect to a prod-
uct that is the subject of a filing under 
paragraph (1); or 
(ii) the Securities and Exchange Com-
mission from requesting that the Com-
modity Futures Trading Commission grant 
an exemption pursuant to section 4(c)(1) of 
the Commodity Exchange Act (7 U.S.C. 
6(c)(1)) with respect to a product that is the 
subject of a filing under paragraph (1). 
Provided, however, that nothing in this subpara-
graph shall be construed to require the Com-
modity Futures Trading Commission or the Se-
curities and Exchange Commission to issue an 
exemption requested pursuant to this subpara-
graph; provided further, That an order granting 
or denying an exemption described in this sub-
paragraph and issued under paragraph (3)(B) 
shall not be subject to judicial review pursuant 
to subsection (b). 
(E) WITHDRAWAL OF REQUEST.—A request 
under subparagraph (A) or (B) may be with-
drawn by the Commission making the request at 
any time prior to a determination being made 
pursuant to paragraph (3) for any reason by
514 
† HR 4173 EAS 
providing written notice to the head of the other 
Commission. 
(3) 
DETERMINATION.—Notwithstanding 
any 
other provision of law, no later than 120 days after 
the date of receipt of a request— 
(A) under subparagraph (A) or (B) of para-
graph (2), unless such request has been with-
drawn pursuant to paragraph (2)(E), the Secu-
rities and Exchange Commission or the Com-
modity Futures Trading Commission, as appli-
cable, shall, by order, issue the determination re-
quested in subparagraph (A) or (B) of para-
graph (2), as applicable, and the reasons there-
fore; or 
(B) under paragraph (2)(D), unless such re-
quest has been withdrawn, the Securities and 
Exchange Commission or the Commodity Fu-
tures Trading Commission, as applicable, shall 
grant an exemption or provide reasons for not 
granting such exemption, provided that any de-
cision by the Securities and Exchange Commis-
sion not to grant such exemption shall not be re-
viewable under section 25 of the Securities Ex-
change Act of 1934 (15 U.S.C. 78y). 
(b) JUDICIAL RESOLUTION.—
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† HR 4173 EAS 
(1) IN
GENERAL.—The Commodity Futures 
Trading Commission or the Securities and Exchange 
Commission may petition the United States Court of 
Appeals for the District of Columbia Circuit for re-
view of a final order of the other Commission, with 
respect to a novel derivative product that may have 
elements of both securities and contracts of sale of a 
commodity for future delivery (or options on such 
contracts or options on commodities) that it believes 
affects its statutory jurisdiction, including an order 
or orders issued under subsection (a)(3)(A), by filing 
in such court, within 60 days after the date of entry 
of such order, a written petition requesting a review 
of the order. Any such proceeding shall be expedited 
by the Court of Appeals. 
(2) TRANSMITTAL OF PETITION AND RECORD.— 
A copy of a petition described in paragraph (1) shall 
be transmitted not later than 1 business day after fil-
ing by the complaining Commission to the responding 
Commission. On receipt of the petition, the respond-
ing Commission shall file with the court a copy of the 
order under review and any documents referred to 
therein, and any other materials prescribed by the 
court.
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† HR 4173 EAS 
(3) STANDARD OF REVIEW.—The court, in con-
sidering a petition filed pursuant to paragraph (1), 
shall give no deference to, or presumption in favor of, 
the views of either Commission. 
(4) JUDICIAL STAY.—The filing of a petition by 
the complaining Commission pursuant to paragraph 
(1) shall operate as a stay of the order, until the date 
on which the determination of the court is final (in-
cluding any appeal of the determination). 
PART II—REGULATION OF SWAP MARKETS 
SEC. 721. DEFINITIONS. 
(a) IN GENERAL.—Section 1a of the Commodity Ex-
change Act (7 U.S.C. 1a) is amended— 
(1) by redesignating paragraphs (2), (3) and (4), 
(5) through (17), (18) through (23), (24) through 
(28), (29), (30), (31) through (33), and (34) as para-
graphs (6), (8) and (9), (11) through (23), (26) 
through (31), (34) through (38), (40), (41), (44) 
through (46), and (51), respectively; 
(2) by inserting after paragraph (1) the fol-
lowing: 
‘‘(2) APPROPRIATE
FEDERAL
BANKING
AGEN-
CY.—The term ‘appropriate Federal banking agency’ 
has the meaning given the term in section 3 of the 
Federal Deposit Insurance Act (12 U.S.C. 1813).
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† HR 4173 EAS 
‘‘(3) ASSOCIATED PERSON OF A SECURITY-BASED 
SWAP DEALER OR MAJOR SECURITY-BASED SWAP PAR-
TICIPANT.—The term ‘associated person of a security- 
based swap dealer or major security-based swap par-
ticipant’ has the meaning given the term in section 
3(a) of the Securities Exchange Act of 1934 (15 
U.S.C. 78c(a)). 
‘‘(4) ASSOCIATED PERSON OF A SWAP DEALER 
OR MAJOR SWAP PARTICIPANT.— 
‘‘(A) IN
GENERAL.—The term ‘associated 
person of a swap dealer or major swap partici-
pant’ means— 
‘‘(i) any partner, officer, director, or 
branch manager of a swap dealer or major 
swap participant (including any individual 
who holds a similar status or performs a 
similar function with respect to any part-
ner, officer, director, or branch manager of 
a swap dealer or major swap participant); 
‘‘(ii) any person that directly or indi-
rectly controls, is controlled by, or is under 
common control with, a swap dealer or 
major swap participant; and 
‘‘(iii) any employee of a swap dealer 
or major swap participant.
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† HR 4173 EAS 
‘‘(B) EXCLUSION.—Other than for purposes 
of section 4s(b)(6), the term ‘associated person of 
a swap dealer or major swap participant’ does 
not include any person associated with a swap 
dealer or major swap participant the functions 
of which are solely clerical or ministerial. 
‘‘(5) BOARD.—The term ‘Board’ means the 
Board of Governors of the Federal Reserve System.’’; 
(3) by inserting after paragraph (6) (as redesig-
nated by paragraph (1)) the following: 
‘‘(7) CLEARED SWAP.—The term ‘cleared swap’ 
means any swap that is, directly or indirectly, sub-
mitted to and cleared by a derivatives clearing orga-
nization registered with the Commission.’’; 
(4) in paragraph (9) (as redesignated by para-
graph (1)), by striking ‘‘except onions’’ and all that 
follows through the period at the end and inserting 
the following: ‘‘except onions (as provided in section 
13–1) and motion picture box office receipts (or any 
index, measure, value, or data related to such re-
ceipts), and all services, rights, and interests (except 
motion picture box office receipts, or any index, meas-
ure, value or data related to such receipts) in which 
contracts for future delivery are presently or in the 
future dealt in.’’;
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† HR 4173 EAS 
(5) by inserting after paragraph (9) (as redesig-
nated by paragraph (1)) the following: 
‘‘(10) COMMODITY POOL.— 
‘‘(A) IN GENERAL.—The term ‘commodity 
pool’ means any investment trust, syndicate, or 
similar form of enterprise operated for the pur-
pose of trading in commodity interests, includ-
ing any— 
‘‘(i) commodity for future delivery, se-
curity futures product, or swap; 
‘‘(ii) agreement, contract, or trans-
action described in section 2(c)(2)(C)(i) or 
section 2(c)(2)(D)(i); 
‘‘(iii) commodity option authorized 
under section 4c; or 
‘‘(iv) leverage transaction authorized 
under section 19. 
‘‘(B) FURTHER DEFINITION.—The Commis-
sion, by rule or regulation, may include within, 
or exclude from, the term ‘commodity pool’ any 
investment trust, syndicate, or similar form of 
enterprise if the Commission determines that the 
rule or regulation will effectuate the purposes of 
this Act.’’;
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† HR 4173 EAS 
(6) by striking paragraph (11) (as redesignated 
by paragraph (1)) and inserting the following: 
‘‘(11) COMMODITY POOL OPERATOR.— 
‘‘(A) IN GENERAL.—The term ‘commodity 
pool operator’ means any person— 
‘‘(i) engaged in a business that is of 
the nature of a commodity pool, investment 
trust, syndicate, or similar form of enter-
prise, and who, in connection therewith, so-
licits, accepts, or receives from others, funds, 
securities, or property, either directly or 
through capital contributions, the sale of 
stock or other forms of securities, or other-
wise, for the purpose of trading in com-
modity interest, including any— 
‘‘(I) commodity for future deliv-
ery, security futures product, or swap; 
‘‘(II) 
agreement, 
contract, 
or 
transaction 
described 
in 
section 
2(c)(2)(C)(i) or section 2(c)(2)(D)(i); 
‘‘(III) commodity option author-
ized under section 4c; or 
‘‘(IV) leverage transaction author-
ized under section 19; or
521 
† HR 4173 EAS 
‘‘(ii) who is registered with the Com-
mission as a commodity pool operator. 
‘‘(B) FURTHER DEFINITION.—The Commis-
sion, by rule or regulation, may include within, 
or exclude from, the term ‘commodity pool oper-
ator’ any person engaged in a business that is of 
the nature of a commodity pool, investment 
trust, syndicate, or similar form of enterprise if 
the Commission determines that the rule or regu-
lation will effectuate the purposes of this Act.’’; 
(7) in paragraph (12) (as redesignated by para-
graph (1)), in subparagraph (A)— 
(A) in clause (i)— 
(i) in subclause (I), by striking ‘‘made 
or to be made on or subject to the rules of 
a contract market or derivatives transaction 
execution facility’’ and inserting ‘‘, security 
futures product, or swap’’; 
(ii) by redesignating subclauses (II) 
and (III) as subclauses (III) and (IV); 
(iii) by inserting after subclause (I) the 
following: 
‘‘(II) any agreement, contract, or 
transaction 
described 
in 
section
522 
† HR 4173 EAS 
2(c)(2)(C)(i) or section 2(c)(2)(D)(i)’’; 
and 
(iv) in subclause (IV) (as so redesig-
nated), by striking ‘‘or’’; 
(B) in clause (ii), by striking the period at 
the end and inserting a semicolon; and 
(C) by adding at the end the following: 
‘‘(iii) is registered with the Commis-
sion as a commodity trading advisor; or 
‘‘(iv) the Commission, by rule or regu-
lation, may include if the Commission de-
termines that the rule or regulation will ef-
fectuate the purposes of this Act.’’; 
(8) in paragraph (17) (as redesignated by para-
graph (1)), in subparagraph (A), in the matter pre-
ceding clause (i), by striking ‘‘paragraph (12)(A)’’ 
and inserting ‘‘paragraph (18)(A)’’; 
(9) in paragraph (18) (as redesignated by para-
graph (1))— 
(A) in subparagraph (A)— 
(i) in the matter following clause 
(vii)(III)— 
(I) 
by 
striking 
‘‘section 
1a 
(11)(A)’’ and inserting ‘‘paragraph 
(17)(A)’’; and
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† HR 4173 EAS 
(II) by striking ‘‘$25,000,000’’ 
and inserting ‘‘$50,000,000’’; and 
(ii) in clause (xi), in the matter pre-
ceding subclause (I), by striking ‘‘total as-
sets in an amount’’ and inserting ‘‘amounts 
invested on a discretionary basis, the aggre-
gate of which is’’; 
(10) by striking paragraph (22) (as redesignated 
by paragraph (1)) and inserting the following: 
‘‘(22) FLOOR BROKER.— 
‘‘(A) IN GENERAL.—The term ‘floor broker’ 
means any person— 
‘‘(i) who, in or surrounding any pit, 
ring, post, or other place provided by a con-
tract market for the meeting of persons 
similarly engaged, shall purchase or sell for 
any other person— 
‘‘(I) any commodity for future de-
livery, security futures product, or 
swap; or 
‘‘(II) any commodity option au-
thorized under section 4c; or 
‘‘(ii) who is registered with the Com-
mission as a floor broker.
524 
† HR 4173 EAS 
‘‘(B) FURTHER DEFINITION.—The Commis-
sion, by rule or regulation, may include within, 
or exclude from, the term ‘floor broker’ any per-
son in or surrounding any pit, ring, post, or 
other place provided by a contract market for the 
meeting of persons similarly engaged who trades 
for any other person if the Commission deter-
mines that the rule or regulation will effectuate 
the purposes of this Act.’’; 
(11) by striking paragraph (23) (as redesignated 
by paragraph (1)) and inserting the following: 
‘‘(23) FLOOR TRADER.— 
‘‘(A) IN GENERAL.—The term ‘floor trader’ 
means any person— 
‘‘(i) who, in or surrounding any pit, 
ring, post, or other place provided by a con-
tract market for the meeting of persons 
similarly engaged, purchases, or sells solely 
for such person’s own account— 
‘‘(I) any commodity for future de-
livery, security futures product, or 
swap; or 
‘‘(II) any commodity option au-
thorized under section 4c; or
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† HR 4173 EAS 
‘‘(ii) who is registered with the Com-
mission as a floor trader. 
‘‘(B) FURTHER DEFINITION.—The Commis-
sion, by rule or regulation, may include within, 
or exclude from, the term ‘floor trader’ any per-
son in or surrounding any pit, ring, post, or 
other place provided by a contract market for the 
meeting of persons similarly engaged who trades 
solely for such person’s own account if the Com-
mission determines that the rule or regulation 
will effectuate the purposes of this Act.’’; 
(12) by inserting after paragraph (23) (as redes-
ignated by paragraph (1)) the following: 
‘‘(24) FOREIGN EXCHANGE FORWARD.—The term 
‘foreign exchange forward’ means a transaction that 
solely involves the exchange of 2 different currencies 
on a specific future date at a fixed rate agreed upon 
on the inception of the contract covering the exchange. 
‘‘(25) FOREIGN
EXCHANGE
SWAP.—The term 
‘foreign exchange swap’ means a transaction that 
solely involves— 
‘‘(A) an exchange of 2 different currencies 
on a specific date at a fixed rate that is agreed 
upon on the inception of the contract covering 
the exchange; and
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† HR 4173 EAS 
‘‘(B) a reverse exchange of the 2 currencies 
described in subparagraph (A) at a later date 
and at a fixed rate that is agreed upon on the 
inception of the contract covering the exchange.’’; 
(13) by striking paragraph (28) (as redesignated 
by paragraph (1)) and inserting the following: 
‘‘(28) FUTURES COMMISSION MERCHANT.— 
‘‘(A) IN GENERAL.—The term ‘futures com-
mission merchant’ means an individual, associa-
tion, partnership, corporation, or trust— 
‘‘(i) that— 
‘‘(I) is engaged in soliciting or in 
accepting orders for— 
‘‘(aa) the purchase or sale of 
a commodity for future delivery; 
‘‘(bb) a security futures prod-
uct; 
‘‘(cc) a swap; 
‘‘(dd) any agreement, con-
tract, or transaction described in 
section 2(c)(2)(C)(i) or section 
2(c)(2)(D)(i); 
‘‘(ee) any commodity option 
authorized under section 4c; or
527 
† HR 4173 EAS 
‘‘(ff) any leverage transaction 
authorized under section 19; or 
‘‘(II) is acting as a counterparty 
in any agreement, contract, or trans-
action 
described 
in 
section 
2(c)(2)(C)(i) or section 2(c)(2)(D)(i); 
and 
‘‘(III) in or in connection with 
the activities described in subclause (I) 
or (II), accepts any money, securities, 
or property (or extends credit in lieu 
thereof) to margin, guarantee, or secure 
any trades or contracts that result or 
may result therefrom; or 
‘‘(ii) that is registered with the Com-
mission as a futures commission merchant. 
‘‘(B) FURTHER DEFINITION.—The Commis-
sion, by rule or regulation, may include within, 
or exclude from, the term ‘futures commission 
merchant’ any person who engages in soliciting 
or accepting orders for, or acting as a 
counterparty in, any agreement, contract, or 
transaction subject to this Act, and who accepts 
any money, securities, or property (or extends 
credit in lieu thereof) to margin, guarantee, or
528 
† HR 4173 EAS 
secure any trades or contracts that result or may 
result therefrom, if the Commission determines 
that the rule or regulation will effectuate the 
purposes of this Act.’’; 
(14) in paragraph (30) (as redesignated by 
paragraph (1)), in subparagraph (B), by striking 
‘‘state’’ and inserting ‘‘State’’; 
(15) by striking paragraph (31) (as redesignated 
by paragraph (1)) and inserting the following: 
‘‘(31) INTRODUCING BROKER.— 
‘‘(A) IN GENERAL.—The term ‘introducing 
broker’ means any person (except an individual 
who elects to be and is registered as an associ-
ated person of a futures commission merchant)— 
‘‘(i) who— 
‘‘(I) is engaged in soliciting or in 
accepting orders for— 
‘‘(aa) the purchase or sale of 
any commodity for future deliv-
ery, security futures product, or 
swap; 
‘‘(bb) any agreement, con-
tract, or transaction described in 
section 2(c)(2)(C)(i) or section 
2(c)(2)(D)(i);
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† HR 4173 EAS 
‘‘(cc) any commodity option 
authorized under section 4c; or 
‘‘(dd) any leverage trans-
action authorized under section 
19; and 
‘‘(II) does not accept any money, 
securities, or property (or extend credit 
in lieu thereof) to margin, guarantee, 
or secure any trades or contracts that 
result or may result therefrom; or 
‘‘(ii) who is registered with the Com-
mission as an introducing broker. 
‘‘(B) FURTHER DEFINITION.—The Commis-
sion, by rule or regulation, may include within, 
or exclude from, the term ‘introducing broker’ 
any person who engages in soliciting or accept-
ing orders for any agreement, contract, or trans-
action subject to this Act, and who does not ac-
cept any money, securities, or property (or ex-
tend credit in lieu thereof) to margin, guarantee, 
or secure any trades or contracts that result or 
may result therefrom, if the Commission deter-
mines that the rule or regulation will effectuate 
the purposes of this Act.’’;
530 
† HR 4173 EAS 
(16) by inserting after paragraph (31) (as redes-
ignated by paragraph (1)) the following: 
‘‘(32) MAJOR
SECURITY-BASED
SWAP
PARTICI-
PANT.—The term ‘major security-based swap partici-
pant’ has the meaning given the term in section 3(a) 
of the Securities Exchange Act of 1934 (15 U.S.C. 
78c(a)). 
‘‘(33) MAJOR SWAP PARTICIPANT.— 
‘‘(A) IN GENERAL.—The term ‘major swap 
participant’ means any person who is not a 
swap dealer, and— 
‘‘(i) maintains a substantial position 
in swaps for any of the major swap cat-
egories as determined by the Commission, 
excluding— 
‘‘(I) positions held for hedging or 
mitigating commercial risk; and 
‘‘(II) positions maintained by any 
employee benefit plan (or any contract 
held by such a plan) as defined in 
paragraphs (3) and (32) of section 3 of 
the Employee Retirement Income Secu-
rity Act of 1974 (29 U.S.C. 1002) for 
the primary purpose of hedging or
531 
† HR 4173 EAS 
mitigating any risk directly associated 
with the operation of the plan; or 
‘‘(ii) whose outstanding swaps create 
substantial 
counterparty 
exposure 
that 
could have serious adverse effects on the fi-
nancial stability of the United States bank-
ing system or financial markets; or 
‘‘(iii)(I) is a financial entity, other 
than an entity predominantly engaged in 
providing financing for the purchase of an 
affiliate’s merchandise or manufactured 
goods, that is highly leveraged relative to 
the amount of capital it holds; and 
‘‘(II) maintains a substantial position 
in outstanding swaps in any major swap 
category as determined by the Commission. 
‘‘(B) DEFINITION
OF
SUBSTANTIAL
POSI-
TION.—For purposes of subparagraph (A), the 
Commission shall define by rule or regulation 
the term ‘substantial position’ at the threshold 
that the Commission determines to be prudent 
for the effective monitoring, management, and 
oversight of entities that are systemically impor-
tant or can significantly impact the financial 
system of the United States.
532 
† HR 4173 EAS 
‘‘(C) SCOPE
OF
DESIGNATION.—For pur-
poses of subparagraph (A), a person may be des-
ignated as a major swap participant for 1 or 
more categories of swaps without being classified 
as a major swap participant for all classes of 
swaps. 
‘‘(D) CAPITAL.—In setting capital require-
ments for a person that is designated as a major 
swap participant for a single type or single class 
or category of swaps or activities, the prudential 
regulator and the Commission shall take into ac-
count the risks associated with other types of 
swaps or classes of swaps or categories of swaps 
engaged in and the other activities conducted by 
that person that are not otherwise subject to reg-
ulation applicable to that person by virtue of the 
status of the person as a major swap partici-
pant.’’; 
(17) by inserting after paragraph (38) (as redes-
ignated by paragraph (1)) the following: 
‘‘(39) 
PRUDENTIAL
REGULATOR.—The 
term 
‘prudential regulator’ means— 
‘‘(A) the Office of the Comptroller of the 
Currency, in the case of— 
‘‘(i) any national banking association;
533 
† HR 4173 EAS 
‘‘(ii) any Federal branch or agency of 
a foreign bank; or 
‘‘(iii) any Federal savings association; 
‘‘(B) the Federal Deposit Insurance Cor-
poration, in the case of— 
‘‘(i) any insured State bank; 
‘‘(ii) any foreign bank having an in-
sured branch; or 
‘‘(iii) any State savings association; 
‘‘(C) the Board of Governors of the Federal 
Reserve System, in the case of— 
‘‘(i) any noninsured State member 
bank; 
‘‘(ii) any branch or agency of a foreign 
bank with respect to any provision of the 
Federal Reserve Act (12 U.S.C. 221 et seq.) 
which is made applicable under the Inter-
national Banking Act of 1978 (12 U.S.C. 
3101 et seq.); 
‘‘(iii) any foreign bank which does not 
operate an insured branch; 
‘‘(iv) any agency or commercial lend-
ing company other than a Federal agency; 
or
534 
† HR 4173 EAS 
‘‘(v) supervisory or regulatory pro-
ceedings arising from the authority given to 
the Board of Governors under section 
7(c)(1) of the International Banking Act of 
1978 (12 U.S.C. 3105(c)(1)), including such 
proceedings under the Financial Institu-
tions Supervisory Act of 1966 (12 U.S.C. 
1464 et seq.); and 
‘‘(D) the Farm Credit Administration, in 
the case of a swap dealer, major swap partici-
pant, security-based swap dealer, or major secu-
rity-based swap participant that is an institu-
tion chartered under the Farm Credit Act of 
1971 (12 U.S.C. 2001 et seq.).’’; 
(18) in paragraph (40) (as redesignated by 
paragraph (1))— 
(A) by striking subparagraph (B); 
(B) by redesignating subparagraphs (C), 
(D), and (E) as subparagraphs (B), (C), and 
(F), respectively; 
(C) in subparagraph (C) (as so redesig-
nated), by striking ‘‘and’’; 
(D) by inserting after subparagraph (C) (as 
so redesignated) the following:
535 
† HR 4173 EAS 
‘‘(D) a swap execution facility registered 
under section 5h; 
‘‘(E) a swap data repository; and’’; 
(19) by inserting after paragraph (41) (as redes-
ignated by paragraph (1)) the following: 
‘‘(42) SECURITY-BASED SWAP.—The term ‘secu-
rity-based swap’ has the meaning given the term in 
section 3(a) of the Securities Exchange Act of 1934 
(15 U.S.C. 78c(a)). 
‘‘(43) SECURITY-BASED
SWAP
DEALER.—The 
term ‘security-based swap dealer’ has the meaning 
given the term in section 3(a) of the Securities Ex-
change Act of 1934 (15 U.S.C. 78c(a)).’’; 
(20) in paragraph (46) (as redesignated by 
paragraph (1)), by striking ‘‘subject to section 
2(h)(7)’’ and inserting ‘‘subject to section 2(h)(5)’’; 
(21) by inserting after paragraph (46) (as redes-
ignated by paragraph (1)) the following: 
‘‘(47) SWAP.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), the term ‘swap’ means any 
agreement, contract, or transaction— 
‘‘(i) that is a put, call, cap, floor, col-
lar, or similar option of any kind that is 
for the purchase or sale, or based on the
536 
† HR 4173 EAS 
value, of 1 or more interest or other rates, 
currencies, commodities, securities, instru-
ments of indebtedness, indices, quantitative 
measures, or other financial or economic in-
terests or property of any kind; 
‘‘(ii) that provides for any purchase, 
sale, payment, or delivery (other than a 
dividend on an equity security) that is de-
pendent on the occurrence, nonoccurrence, 
or the extent of the occurrence of an event 
or contingency associated with a potential 
financial, economic, or commercial con-
sequence; 
‘‘(iii) that provides on an executory 
basis for the exchange, on a fixed or contin-
gent basis, of 1 or more payments based on 
the value or level of 1 or more interest or 
other rates, currencies, commodities, securi-
ties, instruments of indebtedness, indices, 
quantitative measures, or other financial or 
economic interests or property of any kind, 
or any interest therein or based on the value 
thereof, and that transfers, as between the 
parties to the transaction, in whole or in 
part, the financial risk associated with a
537 
† HR 4173 EAS 
future change in any such value or level 
without also conveying a current or future 
direct or indirect ownership interest in an 
asset (including any enterprise or invest-
ment pool) or liability that incorporates the 
financial risk so transferred, including any 
agreement, contract, or transaction com-
monly known as— 
‘‘(I) an interest rate swap; 
‘‘(II) a rate floor; 
‘‘(III) a rate cap; 
‘‘(IV) a rate collar; 
‘‘(V) a cross-currency rate swap; 
‘‘(VI) a basis swap; 
‘‘(VII) a currency swap; 
‘‘(VIII) a foreign exchange swap; 
‘‘(IX) a total return swap; 
‘‘(X) an equity index swap; 
‘‘(XI) an equity swap; 
‘‘(XII) a debt index swap; 
‘‘(XIII) a debt swap; 
‘‘(XIV) a credit spread; 
‘‘(XV) a credit default swap; 
‘‘(XVI) a credit swap; 
‘‘(XVII) a weather swap;
538 
† HR 4173 EAS 
‘‘(XVIII) an energy swap; 
‘‘(XIX) a metal swap; 
‘‘(XX) an agricultural swap; 
‘‘(XXI) an emissions swap; and 
‘‘(XXII) a commodity swap; 
‘‘(iv) that is an agreement, contract, or 
transaction that is, or in the future becomes 
commonly known to the trade as a swap; 
‘‘(v) including any security-based swap 
agreement which meets the definition of 
‘swap agreement’ as defined in section 206A 
of the Gramm-Leach-Bliley Act (15 U.S.C. 
78c note) of which a material term is based 
on the price, yield, value, or volatility of 
any security or any group or index of secu-
rities, or any interest therein; or 
‘‘(vi) that is any combination or per-
mutation of, or option on, any agreement, 
contract, or transaction described in any of 
clauses (i) through (v). 
‘‘(B) EXCLUSIONS.—The term ‘swap’ does 
not include— 
‘‘(i) any contract of sale of a com-
modity for future delivery (or option on 
such a contract), leverage contract author-
539 
† HR 4173 EAS 
ized under section 19, security futures prod-
uct, or agreement, contract, or transaction 
described in section 2(c)(2)(C)(i) or section 
2(c)(2)(D)(i); 
‘‘(ii) any sale of a nonfinancial com-
modity or security for deferred shipment or 
delivery, so long as the transaction is in-
tended to be physically settled; 
‘‘(iii) any put, call, straddle, option, or 
privilege on any security, certificate of de-
posit, or group or index of securities, in-
cluding any interest therein or based on the 
value thereof, that is subject to— 
‘‘(I) the Securities Act of 1933 (15 
U.S.C. 77a et seq.); and 
‘‘(II) the Securities Exchange Act 
of 1934 (15 U.S.C. 78a et seq.); 
‘‘(iv) any put, call, straddle, option, or 
privilege relating to a foreign currency en-
tered into on a national securities exchange 
registered pursuant to section 6(a) of the 
Securities Exchange Act of 1934 (15 U.S.C. 
78f(a)); 
‘‘(v) any agreement, contract, or trans-
action providing for the purchase or sale of
540 
† HR 4173 EAS 
1 or more securities on a fixed basis that is 
subject to— 
‘‘(I) the Securities Act of 1933 (15 
U.S.C. 77a et seq.); and 
‘‘(II) the Securities Exchange Act 
of 1934 (15 U.S.C. 78a et seq.); 
‘‘(vi) any agreement, contract, or 
transaction providing for the purchase or 
sale of 1 or more securities on a contingent 
basis that is subject to the Securities Act of 
1933 (15 U.S.C. 77a et seq.) and the Securi-
ties Exchange Act of 1934 (15 U.S.C. 78a 
et seq.), unless the agreement, contract, or 
transaction predicates the purchase or sale 
on the occurrence of a bona fide contingency 
that might reasonably be expected to affect 
or be affected by the creditworthiness of a 
party other than a party to the agreement, 
contract, or transaction; 
‘‘(vii) any note, bond, or evidence of 
indebtedness that is a security, as defined 
in section 2(a) of the Securities Act of 1933 
(15 U.S.C. 77b(a)); 
‘‘(viii) any agreement, contract, or 
transaction that is—
541 
† HR 4173 EAS 
‘‘(I) based on a security; and 
‘‘(II) entered into directly or 
through an underwriter (as defined in 
section 2(a) of the Securities Act of 
1933 (15 U.S.C. 77b(a))) by the issuer 
of such security for the purposes of 
raising capital, unless the agreement, 
contract, or transaction is entered into 
to manage a risk associated with cap-
ital raising; 
‘‘(ix) any agreement, contract, or 
transaction a counterparty of which is a 
Federal Reserve bank, the Federal Govern-
ment, or a Federal agency that is expressly 
backed by the full faith and credit of the 
United States; and 
‘‘(x) any security-based swap, other 
than a security-based swap as described in 
subparagraph (D). 
‘‘(C) RULE OF CONSTRUCTION REGARDING 
MASTER AGREEMENTS.— 
‘‘(i) IN GENERAL.—Except as provided 
in clause (ii), the term ‘swap’ includes a 
master agreement that provides for an 
agreement, contract, or transaction that is a
542 
† HR 4173 EAS 
swap under subparagraph (A), together 
with each supplement to any master agree-
ment, without regard to whether the master 
agreement contains an agreement, contract, 
or transaction that is not a swap pursuant 
to subparagraph (A). 
‘‘(ii) EXCEPTION.—For purposes of 
clause (i), the master agreement shall be 
considered to be a swap only with respect to 
each agreement, contract, or transaction 
covered by the master agreement that is a 
swap pursuant to subparagraph (A). 
‘‘(D) MIXED
SWAP.—The term ‘security- 
based swap’ includes any agreement, contract, or 
transaction that is as described in section 
3(a)(68)(A) of the Securities Exchange Act of 
1934 (15 U.S.C. 78c(a)(68)(A)) and also is based 
on the value of 1 or more interest or other rates, 
currencies, commodities, instruments of indebted-
ness, indices, quantitative measures, other finan-
cial or economic interest or property of any kind 
(other than a single security or a narrow-based 
security index), or the occurrence, non-occur-
rence, or the extent of the occurrence of an event 
or contingency associated with a potential finan-
543 
† HR 4173 EAS 
cial, economic, or commercial consequence (other 
than an event described in subparagraph 
(A)(iii)). 
‘‘(E) TREATMENT OF FOREIGN EXCHANGE 
SWAPS AND FORWARDS.— 
‘‘(i) IN
GENERAL.—Foreign exchange 
swaps and foreign exchange forwards shall 
be considered swaps under this paragraph 
unless the Secretary makes a written deter-
mination that either foreign exchange swaps 
or foreign exchange forwards or both— 
‘‘(I) should be not be regulated as 
swaps under this Act; and 
‘‘(II) are not structured to evade 
the Wall Street Transparency and Ac-
countability Act of 2010 in violation of 
any rule promulgated by the Commis-
sion pursuant to section 111(c) of that 
Act. 
‘‘(ii) CONGRESSIONAL NOTICE; EFFEC-
TIVENESS.—The Secretary shall submit any 
written determination under clause (i) to 
the appropriate committees of Congress, in-
cluding the Committee on Agriculture, Nu-
trition, and Forestry of the Senate and the
544 
† HR 4173 EAS 
Committee on Agriculture of the House of 
Representatives. Any such written deter-
mination by the Secretary shall not be effec-
tive until it is submitted to the appropriate 
committees of Congress. 
‘‘(iii) REPORTING.—Notwithstanding a 
written determination by the Secretary 
under clause (i), all foreign exchange swaps 
and foreign exchange forwards shall be re-
ported to either a swap data repository, or, 
if there is no swap data repository that 
would accept such swaps or forwards, to the 
Commission pursuant to section 4r within 
such time period as the Commission may by 
rule or regulation prescribe. 
‘‘(iv) 
BUSINESS
STANDARDS.—Not-
withstanding clauses (ix) and (x) of sub-
paragraph (B) and clause (ii), any party to 
a foreign exchange swap or forward that is 
a swap dealer or major swap participant 
shall conform to the business conduct stand-
ards contained in section 4s(h). 
‘‘(v) SECRETARY.—For purposes of this 
subparagraph only, the term ‘Secretary’ 
means the Secretary of the Treasury.
545 
† HR 4173 EAS 
‘‘(F) EXCEPTION FOR CERTAIN FOREIGN EX-
CHANGE SWAPS AND FORWARDS.— 
‘‘(i) REGISTERED ENTITIES.—Any for-
eign exchange swap and any foreign ex-
change forward that is listed and traded on 
or subject to the rules of a designated con-
tract market or a swap execution facility, 
or that is cleared by a derivatives clearing 
organization shall not be exempt from any 
provision of this Act or amendments made 
by the Wall Street Transparency and Ac-
countability Act of 2010 prohibiting fraud 
or manipulation. 
‘‘(ii) RETAIL TRANSACTIONS.—Nothing 
in subparagraph (E) shall affect, or be con-
strued to affect, the applicability of this Act 
or the jurisdiction of the Commission with 
respect to agreements, contracts, or trans-
actions in foreign currency pursuant to sec-
tion 2(c)(2). 
‘‘(48) SWAP DATA REPOSITORY.—The term ‘swap 
data repository’ means any person that collects, cal-
culates, prepares, or maintains information or 
records with respect to transactions or positions in, or
546 
† HR 4173 EAS 
the terms and conditions of, swaps entered into by 
third parties. 
‘‘(49) SWAP DEALER.— 
‘‘(A) IN GENERAL.—The term ‘swap dealer’ 
means any person who— 
‘‘(i) holds itself out as a dealer in 
swaps; 
‘‘(ii) makes a market in swaps; 
‘‘(iii) regularly engages in the pur-
chase and sale of swaps in the ordinary 
course of business; or 
‘‘(iv) engages in any activity causing 
the person to be commonly known in the 
trade as a dealer or market maker in 
swaps. 
‘‘(B) INCLUSION.—A person may be des-
ignated as a swap dealer for a single type or sin-
gle class or category of swap or activities and 
considered not to be a swap dealer for other 
types, classes, or categories of swaps or activities. 
‘‘(C) CAPITAL.—In setting capital require-
ments for a person that is designated as a swap 
dealer for a single type or single class or cat-
egory of swap or activities, the prudential regu-
lator and the Commission shall take into account
547 
† HR 4173 EAS 
the risks associated with other types of swaps or 
classes of swaps or categories of swaps engaged 
in and the other activities conducted by that per-
son that are not otherwise subject to regulation 
applicable to that person by virtue of the status 
of the person as a swap dealer. 
‘‘(D) EXCEPTION.—The term ‘swap dealer’ 
does not include a person that buys or sells 
swaps for such person’s own account, either indi-
vidually or in a fiduciary capacity, but not as 
a part of a regular business. 
‘‘(50) SWAP
EXECUTION
FACILITY.—The term 
‘swap execution facility’ means a facility in which 
multiple participants have the ability to execute or 
trade swaps by accepting bids and offers made by 
other participants that are open to multiple partici-
pants in the facility or system, through any means of 
interstate commerce, including any trading facility, 
that— 
‘‘(A) facilitates the execution of swaps be-
tween persons; and 
‘‘(B) is not a designated contract market.’’; 
and
548 
† HR 4173 EAS 
(22) in paragraph (51) (as redesignated by 
paragraph (1)), in subparagraph (A)(i), by striking 
‘‘partipants’’ and inserting ‘‘participants’’. 
(b) AUTHORITY TO DEFINE TERMS.—The Commodity 
Futures Trading Commission may adopt a rule to define— 
(1) the term ‘‘commercial risk’’; and 
(2) any other term included in an amendment to 
the Commodity Exchange Act (7 U.S.C. 1 et seq.) 
made by this subtitle. 
(c) MODIFICATION
OF
DEFINITIONS.—To include 
transactions and entities that have been structured to evade 
this subtitle (or an amendment made by this subtitle), the 
Commodity Futures Trading Commission shall adopt a 
rule to further define the terms ‘‘swap’’, ‘‘swap dealer’’, 
‘‘major swap participant’’, and ‘‘eligible contract partici-
pant’’. 
(d) EXEMPTIONS.—Section 4(c)(1) of the Commodity 
Exchange Act (7 U.S.C. 6(c)(1)) is amended by striking 
‘‘except that’’ and all that follows through the period at the 
end and inserting the following: ‘‘except that— 
‘‘(A) unless the Commission is expressly au-
thorized by any provision described in this sub-
paragraph to grant exemptions, with respect to 
amendments made by subtitle A of the Wall
549 
† HR 4173 EAS 
Street Transparency and Accountability Act of 
2010— 
‘‘(i) with respect to— 
‘‘(I) paragraphs (2), (3), (4), (5), 
and (7), clause (vii)(III) of paragraph 
(17), paragraphs (23), (24), (31), (32), 
(38), (39), (41), (42), (46), (47), (48), 
and (49) of section 1a, and sections 
2(a)(13), 2(c)(D), 4a(a), 4a(b), 4d(c), 
4d(d), 4r, 4s, 5b(a), 5b(b), 5(d), 5(g), 
5(h), 5b(c), 5b(i), 8e, and 21; and 
‘‘(II) 
section 
206(e) 
of 
the 
Gramm-Leach-Bliley Act (Public Law 
106–102; 15 U.S.C. 78c note); and 
‘‘(ii) in subsection (c) of section 111 
and section 132; and 
‘‘(B) the Commission and the Securities 
and Exchange Commission may by rule, regula-
tion, or order jointly exclude any agreement, 
contract, or transaction from section 2(a)(1)(D)) 
if the Commission determines that the exemption 
would be consistent with the public interest.’’. 
(e) CONFORMING AMENDMENTS.—
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† HR 4173 EAS 
(1) Section 2(c)(2)(B)(i)(II) of the Commodity 
Exchange Act (7 U.S.C. 2(c)(2)(B)(i)(II)) is amend-
ed— 
(A) in item (cc)— 
(i) in subitem (AA), by striking ‘‘sec-
tion 1a(20)’’ and inserting ‘‘section 1a’’; 
and 
(ii) in subitem (BB), by striking ‘‘sec-
tion 1a(20)’’ and inserting ‘‘section 1a’’; 
and 
(B) in item (dd), by striking ‘‘section 
1a(12)(A)(ii)’’ 
and 
inserting 
‘‘section 
1a(18)(A)(ii)’’. 
(2) Section 4m(3) of the Commodity Exchange 
Act (7 U.S.C. 6m(3)) is amended by striking ‘‘section 
1a(6)’’ and inserting ‘‘section 1a’’. 
(3) Section 4q(a)(1) of the Commodity Exchange 
Act (7 U.S.C. 6o–1(a)(1)) is amended by striking 
‘‘section 1a(4)’’ and inserting ‘‘section 1a(9)’’. 
(4) Section 5(e)(1) of the Commodity Exchange 
Act (7 U.S.C. 7(e)(1)) is amended by striking ‘‘section 
1a(4)’’ and inserting ‘‘section 1a(9)’’. 
(5) Section 5a(b)(2)(F) of the Commodity Ex-
change Act (7 U.S.C. 7a(b)(2)(F)) is amended by
551 
† HR 4173 EAS 
striking ‘‘section 1a(4)’’ and inserting ‘‘section 
1a(9)’’. 
(6) Section 5b(a) of the Commodity Exchange 
Act (7 U.S.C. 7a–1(a)) is amended, in the matter pre-
ceding paragraph (1), by striking ‘‘section 1a(9)’’ and 
inserting ‘‘section 1a’’. 
(7) Section 5c(c)(2)(B) of the Commodity Ex-
change Act (7 U.S.C. 7a–2(c)(2)(B)) is amended by 
striking ‘‘section 1a(4)’’ and inserting ‘‘section 
1a(9)’’. 
(8) Section 6(g)(5)(B)(i) of the Securities Ex-
change Act of 1934 (15 U.S.C. 78f(g)(5)(B)(i)) is 
amended— 
(A) in subclause (I), by striking ‘‘section 
1a(12)(B)(ii)’’ 
and 
inserting 
‘‘section 
1a(18)(B)(ii)’’; and 
(B) in subclause (II), by striking ‘‘section 
1a(12)’’ and inserting ‘‘section 1a(18)’’. 
(9) The Legal Certainty for Bank Products Act 
of 2000 (7 U.S.C. 27 et seq.) is amended— 
(A) in section 402— 
(i) in subsection (a)(7), by striking 
‘‘section 1a(20)’’ and inserting ‘‘section 1a’’; 
(ii) in subsection (b)(2), by striking 
‘‘section 1a(12)’’ and inserting ‘‘section 1a’’;
552 
† HR 4173 EAS 
(iii) in subsection (c), by striking ‘‘sec-
tion 1a(4)’’ and inserting ‘‘section 1a’’; and 
(iv) in subsection (d)— 
(I) in the matter preceding para-
graph (1), by striking ‘‘section 1a(4)’’ 
and inserting ‘‘section 1a(9)’’; 
(II) in paragraph (1)— 
(aa) in subparagraph (A), by 
striking ‘‘section 1a(12)’’ and in-
serting ‘‘section 1a’’; and 
(bb) in subparagraph (B), by 
striking ‘‘section 1a(33)’’ and in-
serting ‘‘section 1a’’; 
(III) in paragraph (2)— 
(aa) in subparagraph (A), by 
striking ‘‘section 1a(10)’’ and in-
serting ‘‘section 1a’’; 
(bb) in subparagraph (B), by 
striking ‘‘section 1a(12)(B)(ii)’’ 
and 
inserting 
‘‘section 
1a(18)(B)(ii)’’; 
(cc) in subparagraph (C), by 
striking ‘‘section 1a(12)’’ and in-
serting ‘‘section 1a(18)’’; and
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† HR 4173 EAS 
(dd) in subparagraph (D), 
by striking ‘‘section 1a(13)’’ and 
inserting ‘‘section 1a’’; and 
(B) in section 404(1), by striking ‘‘section 
1a(4)’’ and inserting ‘‘section 1a’’. 
SEC. 722. JURISDICTION. 
(a) EXCLUSIVE JURISDICTION.—Section 2(a)(1)(A) of 
the Commodity Exchange Act (7 U.S.C. 2(a)(1)(A)) is 
amended in the first sentence— 
(1) by inserting ‘‘the Wall Street Transparency 
and Accountability Act of 2010 (including an amend-
ment made by that Act) and’’ after ‘‘otherwise pro-
vided in’’; 
(2) by striking ‘‘(c) through (i) of this section’’ 
and inserting ‘‘(c) and (f)’’; 
(3) by striking ‘‘contracts of sale’’ and inserting 
‘‘swaps or contracts of sale’’; and 
(4) by striking ‘‘or derivatives transaction execu-
tion facility registered pursuant to section 5 or 5a’’ 
and inserting ‘‘pursuant to section 5’’. 
(b) REGULATION OF SWAPS UNDER FEDERAL AND 
STATE LAW.—Section 12 of the Commodity Exchange Act 
(7 U.S.C. 16) is amended by adding at the end the fol-
lowing:
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† HR 4173 EAS 
‘‘(h) REGULATION OF SWAPS AS INSURANCE UNDER 
STATE LAW.—A swap— 
‘‘(1) shall not be considered to be insurance; and 
‘‘(2) may not be regulated as an insurance con-
tract under the law of any State.’’. 
(c) AGREEMENTS, CONTRACTS, AND TRANSACTIONS 
TRADED
ON
AN
ORGANIZED
EXCHANGE.—Section 
2(c)(2)(A) of the Commodity Exchange Act (7 U.S.C. 
2(c)(2)(A)) is amended— 
(1) in clause (i), by striking ‘‘or’’ at the end; 
(2) by redesignating clause (ii) as clause (iii); 
and 
(3) by inserting after clause (i) the following: 
‘‘(ii) a swap; or’’. 
(d) APPLICABILITY.—Section 2 of the Commodity Ex-
change Act (7 U.S.C. 2) (as amended by section 723(a)(3)) 
is amended by adding at the end the following: 
‘‘(i) APPLICABILITY.—The provisions of this Act relat-
ing to swaps that were enacted by the Wall Street Trans-
parency and Accountability Act of 2010 (including any 
rule prescribed or regulation promulgated under that Act), 
shall not apply to activities outside the United States unless 
those activities—
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† HR 4173 EAS 
‘‘(1) have a direct and significant connection 
with activities in, or effect on, commerce of the 
United States; or 
‘‘(2) contravene such rules or regulations as the 
Commission may prescribe or promulgate as are nec-
essary or appropriate to prevent the evasion of any 
provision of this Act that was enacted by the Wall 
Street Transparency and Accountability Act of 
2010.’’. 
(e) 
JUST
AND
REASONABLE
RATES.—Section 
2(a)(1)(C) of the Commodity Exchange Act (7 U.S.C. 
2(a)(1)(C)) (as amended by section 717(a)) is amended by 
adding at the end the following: 
‘‘(vi) Notwithstanding the exclusive ju-
risdiction of the Commission with respect to 
accounts, agreements, and transactions in-
volving swaps or contracts of sale of a com-
modity for future delivery under this Act, 
no provision of this Act shall be construed— 
‘‘(I) to supersede or limit the au-
thority of the Federal Energy Regu-
latory Commission under the Federal 
Power Act (16 U.S.C. 791a et seq.) or 
the Natural Gas Act (15 U.S.C. 717 et 
seq.);
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† HR 4173 EAS 
‘‘(II) to restrict the Federal En-
ergy Regulatory Commission from car-
rying out the duties and responsibil-
ities of the Federal Energy Regulatory 
Commission to ensure just and reason-
able rates and protect the public inter-
est under the Acts described in sub-
clause (I); or 
‘‘(III) to supersede or limit the 
authority of a State regulatory author-
ity (as defined in section 3(21) of the 
Federal Power Act (16 U.S.C. 796(21)) 
that has jurisdiction to regulate rates 
and charges for the sale of electric en-
ergy within the State, or restrict that 
State regulatory authority from car-
rying out the duties and responsibil-
ities of the State regulatory authority 
pursuant to the jurisdiction of the 
State regulatory authority to regulate 
rates and charges for the transmission 
or sale of electric energy. 
‘‘(vii) Nothing in clause (vi) shall af-
fect the Commission’s authority with respect 
to the trading, execution, or clearing of any
557 
† HR 4173 EAS 
agreement, contract, or transaction on or 
subject to the rules of a registered entity, in-
cluding a designated contract market, de-
rivatives clearing organization, or swaps 
execution facility.’’. 
(f) PUBLIC INTEREST WAIVER.—Section 4(c) of the 
Commodity Exchange Act (7 U.S.C. 6(c)) (as amended by 
section 721(d)) is amended by adding at the end the fol-
lowing: 
‘‘(6) If the Commission determines that the ex-
emption would be consistent with the public interest 
and the purposes of this Act, the Commission shall, 
in accordance with paragraphs (1) and (2), exempt 
from the requirements of this Act an agreement, con-
tract, or transaction that is entered into— 
‘‘(A) pursuant to a tariff or rate schedule 
approved or permitted to take effect by the Fed-
eral Energy Regulatory Commission; 
‘‘(B) pursuant to a tariff or rate schedule 
establishing rates or charges for, or protocols gov-
erning, the sale of electric energy approved or 
permitted to take effect by the regulatory author-
ity of the State or municipality having jurisdic-
tion to regulate rates and charges for the sale of
558 
† HR 4173 EAS 
electric energy within the State or municipality; 
or 
‘‘(C) between entities described in section 
201(f) of the Federal Power Act (16 U.S.C. 
824(f)).’’. 
SEC. 723. CLEARING. 
(a) CLEARING REQUIREMENT.— 
(1) IN GENERAL.—Section 2 of the Commodity 
Exchange Act (7 U.S.C. 2) is amended— 
(A) by striking subsections (d), (e), (g), and 
(h); and 
(B) by redesignating subsection (i) as sub-
section (g). 
(2) SWAPS; LIMITATION
ON
PARTICIPATION.— 
Section 2 of the Commodity Exchange Act (7 U.S.C. 
2) (as amended by paragraph (1)) is amended by in-
serting after subsection (c) the following: 
‘‘(d) SWAPS.—Nothing in this Act (other than sub-
paragraphs (A), (B), (C), and (D) of subsection (a)(1), sub-
sections (f) and (g), sections 1a, 2(c)(2)(A)(ii), 2(e), 2(h), 
4(c), 4a, 4b, and 4b–1, subsections (a), (b), and (g) of sec-
tion 4c, sections 4d, 4e, 4f, 4g, 4h, 4i, 4j, 4k, 4l, 4m, 4n, 
4o, 4p, 4r, 4s, 4t, 5, 5b, 5c, 5e, and 5h, subsections (c) and 
(d) of section 6, sections 6c, 6d, 8, 8a, and 9, subsections 
(e)(2) and (f) of section 12, subsections (a) and (b) of section
559 
† HR 4173 EAS 
13, sections 17, 20, 21, and 22(a)(4), and any other provi-
sion of this Act that is applicable to registered entities and 
Commission registrants) governs or applies to a swap. 
‘‘(e) LIMITATION ON PARTICIPATION.—It shall be un-
lawful for any person, other than an eligible contract par-
ticipant, to enter into a swap unless the swap is entered 
into on, or subject to the rules of, a board of trade des-
ignated as a contract market under section 5.’’. 
(3) MANDATORY CLEARING OF SWAPS.—Section 
2 of the Commodity Exchange Act (7 U.S.C. 2) is 
amended by inserting after subsection (g) (as redesig-
nated by paragraph (1)(B)) the following: 
‘‘(h) CLEARING REQUIREMENT.— 
‘‘(1) SUBMISSION.— 
‘‘(A) IN GENERAL.—Except as provided in 
paragraphs (9) and (10), any person who is a 
party to a swap shall submit such swap for 
clearing to a derivatives clearing organization 
that is registered under this Act or a derivatives 
clearing organization that is exempt from reg-
istration under section 5b(j) of this Act. 
‘‘(B) OPEN ACCESS.—The rules of a reg-
istered derivatives clearing organization shall— 
‘‘(i) prescribe that all swaps with the 
same terms and conditions are economically
560 
† HR 4173 EAS 
equivalent and may be offset with each 
other within the derivatives clearing organi-
zation; and 
‘‘(ii) provide for nondiscriminatory 
clearing of a swap executed bilaterally or on 
or through the rules of an unaffiliated des-
ignated contract market or swap execution 
facility, subject to the requirements of sec-
tion 5(b). 
‘‘(2) COMMISSION APPROVAL.— 
‘‘(A) IN GENERAL.—A derivatives clearing 
organization shall submit to the Commission for 
prior approval any group, category, type, or 
class of swaps that the derivatives clearing orga-
nization seeks to accept for clearing, which sub-
mission the Commission shall make available to 
the public. 
‘‘(B) DEADLINE.—The Commission shall 
take final action on a request submitted pursu-
ant to subparagraph (A) not later than 90 days 
after submission of the request, unless the deriva-
tives clearing organization submitting the re-
quest agrees to an extension of the time limita-
tion established under this subparagraph.
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† HR 4173 EAS 
‘‘(C) APPROVAL.—The Commission shall 
approve, unconditionally or subject to such terms 
and conditions as the Commission determines to 
be appropriate, any request submitted pursuant 
to subparagraph (A) if the Commission finds 
that the request is consistent with section 
5b(c)(2). The Commission shall not approve any 
such request if the Commission does not make 
such finding. 
‘‘(D) RULES.—The Commission shall adopt 
rules for a derivatives clearing organization’s 
submission for approval, pursuant to this para-
graph, of any group, category, type, or class of 
swaps that the derivative clearing organization 
seeks to accept for clearing. 
‘‘(3) STAY OF CLEARING REQUIREMENT.—At any 
time after issuance of an approval pursuant to para-
graph (2): 
‘‘(A) REVIEW PROCESS.—The Commission, 
on application of a counterparty to a swap or 
on its own initiative, may stay the clearing re-
quirement of paragraph (1) until the Commis-
sion completes a review of the terms of the swap, 
or the group, category, type, or class of swaps, 
and the clearing arrangement.
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† HR 4173 EAS 
‘‘(B) DEADLINE.—The Commission shall 
complete a review undertaken pursuant to sub-
paragraph (A) not later than 90 days after 
issuance of the stay, unless the derivatives clear-
ing organization that clears the swap, or the 
group, category, type, or class of swaps, agrees to 
an extension of the time limitation established 
under this subparagraph. 
‘‘(C) DETERMINATION.—Upon completion of 
the review undertaken pursuant to subparagraph 
(A)— 
‘‘(i) the Commission may determine, 
unconditionally or subject to such terms 
and conditions as the Commission deter-
mines to be appropriate, that the swap, or 
the group, category, type, or class of swaps, 
must be cleared pursuant to this subsection 
if the Commission finds that such clear-
ing— 
‘‘(I) is consistent with section 
5b(c)(2); and 
‘‘(II) is otherwise in the public in-
terest, for the protection of investors, 
and consistent with the purposes of 
this Act;
563 
† HR 4173 EAS 
‘‘(ii) the Commission may determine 
that the clearing requirement of paragraph 
(1) shall not apply to the swap, or the 
group, category, type, or class of swaps; or 
‘‘(iii) if a determination is made that 
the clearing requirement of paragraph (1) 
shall no longer apply, then it shall still be 
permissible to clear such swap, or the 
group, category, type, or class of swaps. 
‘‘(D) RULES.—The Commission shall adopt 
rules for reviewing, pursuant to this paragraph, 
a derivatives clearing organization’s clearing of 
a swap, or a group, category, type, or class of 
swaps that the Commission has accepted for 
clearing. 
‘‘(4) SWAPS REQUIRED TO BE ACCEPTED FOR 
CLEARING.— 
‘‘(A) RULEMAKING.—The Commission shall 
adopt rules to further identify any group, cat-
egory, type, or class of swaps not submitted for 
approval under paragraph (2) that the Commis-
sion deems should be accepted for clearing. In 
adopting such rules, the Commission shall take 
into account the following factors:
564 
† HR 4173 EAS 
‘‘(i) The extent to which any of the 
terms of the group, category, type, or class 
of swaps, including price, are disseminated 
to third parties or are referenced in other 
agreements, contracts, or transactions. 
‘‘(ii) The volume of transactions in the 
group, category, type, or class of swaps. 
‘‘(iii) The extent to which the terms of 
the group, category, type, or class of swaps 
are similar to the terms of other agreements, 
contracts, or transactions that are cleared. 
‘‘(iv) Whether any differences in the 
terms of the group, category, type, or class 
of swaps, compared to other agreements, 
contracts, or transactions that are cleared, 
are of economic significance. 
‘‘(v) Whether a derivatives clearing or-
ganization is prepared to clear the group, 
category, type, or class of swaps and such 
derivatives clearing organization has in 
place effective risk management systems. 
‘‘(vi) Any other factors the Commission 
determine to be appropriate. 
‘‘(B) OTHER DESIGNATIONS.—At any time 
after the adoption of the rules required under
565 
† HR 4173 EAS 
subparagraph (A), the Commission may sepa-
rately designate a particular swap or class of 
swaps as subject to the clearing requirement in 
paragraph (1), taking into account the factors 
described in clauses (i) through (vi) of subpara-
graph (A) and the rules adopted under such sub-
paragraph. 
‘‘(C) IN
GENERAL.—In accordance with 
subparagraph (A), the Commission shall, con-
sistent with the public interest, adopt rules 
under the expedited process described in subpara-
graph (D) to establish criteria for determining 
that a swap, or any group, category, type, or 
class of swap is required to be cleared. 
‘‘(D) EXPEDITED
RULEMAKING
AUTHOR-
ITY.— 
‘‘(i) PROCEDURE.—The promulgation 
of regulations under subparagraph (A) may 
be made without regard to— 
‘‘(I) the notice and comment pro-
visions of section 553 of title 5, United 
States Code; and 
‘‘(II) chapter 35 of title 44, 
United States Code (commonly known 
as the ‘Paperwork Reduction Act’).
566 
† HR 4173 EAS 
‘‘(ii) AGENCY
RULEMAKING.—In car-
rying out subparagraph (A), the Commis-
sion shall use the authority provided under 
section 808 of title 5, United States Code. 
‘‘(5) PREVENTION OF EVASION.— 
‘‘(A) IN GENERAL.—The Commission may 
prescribe rules under this subsection (and issue 
interpretations of rules prescribed under this 
subsection) as determined by the Commission to 
be necessary to prevent evasions of the manda-
tory clearing requirements under this Act. 
‘‘(B) DUTY OF COMMISSION TO INVESTIGATE 
AND TAKE CERTAIN ACTIONS.—To the extent the 
Commission finds that a particular swap, group, 
category, type, or class of swaps would otherwise 
be subject to mandatory clearing but no deriva-
tives clearing organization has listed the swap, 
group, category, type, or class of swaps for clear-
ing, the Commission shall— 
‘‘(i) investigate the relevant facts and 
circumstances; 
‘‘(ii) within 30 days issue a public re-
port containing the results of the investiga-
tion; and
567 
† HR 4173 EAS 
‘‘(iii) take such actions as the Commis-
sion determines to be necessary and in the 
public interest, which may include requir-
ing the retaining of adequate margin or 
capital by parties to the swap, group, cat-
egory, type, or class of swaps. 
‘‘(C) EFFECT ON AUTHORITY.—Nothing in 
this paragraph shall— 
‘‘(i) authorize the Commission to re-
quire a derivatives clearing organization to 
list for clearing a swap, group, category, 
type, or class of swaps if the clearing of the 
swap, group, category, type, or class of 
swaps would adversely affect the business 
operations of the derivatives clearing orga-
nization, threaten the financial integrity of 
the derivatives clearing organization, or 
pose a systemic risk to the derivatives clear-
ing organization; and 
‘‘(ii) affect the authority of the Com-
mission to enforce the open access provisions 
of paragraph (1) with respect to a swap, 
group, category, type, or class of swaps that 
is listed for clearing by a derivatives clear-
ing organization.
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† HR 4173 EAS 
‘‘(6) REQUIRED REPORTING.— 
‘‘(A) 
BOTH
COUNTERPARTIES.—Both 
counterparties to a swap that is not cleared by 
any derivatives clearing organization shall re-
port such a swap either to a registered swap re-
pository described in section 21 or, if there is no 
repository that would accept the swap, to the 
Commission pursuant to section 4r. 
‘‘(B) TIMING.—Counterparties to a swap 
shall submit the reports required under subpara-
graph (A) not later than such time period as the 
Commission may by rule or regulation prescribe. 
‘‘(7) TRANSITION RULES.— 
‘‘(A) REPORTING
TRANSITION
RULES.— 
Rules adopted by the Commission under this sec-
tion shall provide for the reporting of data, as 
follows: 
‘‘(i) SWAPS
ENTERED
INTO
BEFORE 
DATE
OF
ENACTMENT
OF
THIS
SUB-
SECTION.—Swaps entered into before the 
date of the enactment of this subsection shall 
be reported to a registered swap repository 
or the Commission not later than 180 days 
after the effective date of this subsection.
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† HR 4173 EAS 
‘‘(ii) SWAPS
ENTERED
INTO
ON
OR 
AFTER DATE OF ENACTMENT OF THIS SUB-
SECTION.—Swaps entered into on or after 
such date of enactment shall be reported to 
a registered swap repository or the Commis-
sion not later than the later of— 
‘‘(I) 90 days after such effective 
date; or 
‘‘(II) such other time after enter-
ing into the swap as the Commission 
may prescribe by rule or regulation. 
‘‘(B) CLEARING TRANSITION RULES.— 
‘‘(i) SWAPS
ENTERED
INTO
BEFORE 
THE
DATE
OF
THE
ENACTMENT
OF
THIS 
SUBSECTION.—Swaps entered into before 
the date of the enactment of this subsection 
are exempt from the clearing requirements 
of this subsection if reported pursuant to 
subparagraph (A)(i). 
‘‘(ii) SWAPS
ENTERED
INTO
BEFORE 
APPLICATION
OF
CLEARING
REQUIRE-
MENT.—Swaps entered into before applica-
tion of the clearing requirement pursuant to 
this subsection are exempt from the clearing
570 
† HR 4173 EAS 
requirements of this subsection if reported 
pursuant to subparagraph (A)(ii). 
‘‘(8) TRADE EXECUTION.— 
‘‘(A) IN GENERAL.—With respect to trans-
actions involving swaps subject to the clearing 
requirement of paragraph (1), counterparties 
shall— 
‘‘(i) execute the transaction on a board 
of trade designated as a contract market 
under section 5; or 
‘‘(ii) execute the transaction on a swap 
execution facility registered under section 
5h or a swap execution facility that is ex-
empt from registration under section 5h(f) 
of this Act. 
‘‘(B) EXCEPTION.—The requirements of 
clauses (i) and (ii) of subparagraph (A) shall not 
apply if no board of trade or swap execution fa-
cility makes the swap available to trade or a 
swap transactions where a commercial end user 
opts to use the clearing exemption under para-
graph (9). 
‘‘(9) REQUIRED EXEMPTION.—Subject to para-
graph (4), the Commission shall exempt a swap from 
the requirements of paragraphs (1) and (8) and any
571 
† HR 4173 EAS 
rules issued under this subsection, if no derivatives 
clearing organization registered under this Act or no 
derivatives clearing organization that is exempt from 
registration under section 5b(j) of this Act will accept 
the swap from clearing. 
‘‘(10) END USER CLEARING EXEMPTION.— 
‘‘(A) DEFINITION
OF
COMMERCIAL
END 
USER.— 
‘‘(i) IN GENERAL.—In this paragraph, 
the term ‘commercial end user’ means any 
person other than a financial entity de-
scribed in clause (ii) who, as its primary 
business activity, owns, uses, produces, 
processes, manufactures, distributes, mer-
chandises, or markets goods, services, or 
commodities (which shall include but not be 
limited to coal, natural gas, electricity, eth-
anol, crude oil, gasoline, propane, dis-
tillates, and other hydrocarbons) either in-
dividually or in a fiduciary capacity. 
‘‘(ii) FINANCIAL
ENTITY.—The term 
‘financial entity’ means— 
‘‘(I) a swap dealer, major swap 
participant, security-based swap deal-
572 
† HR 4173 EAS 
er, or major security-based swap par-
ticipant; 
‘‘(II) a person predominantly en-
gaged in activities that are in the busi-
ness of banking or financial in nature, 
as defined in Section 4(k) of the Bank 
Holding Company Act of 1956; 
‘‘(III) a person predominantly en-
gaged in activities that are financial 
in nature; 
‘‘(IV) a commodity pool or a pri-
vate fund as defined in section 202(a) 
of the Investment Advisers Act of 1940 
(15 U.S.C. 80b–2(a)); or 
‘‘(V) a person that is registered or 
required to be registered with the Com-
mission. 
‘‘(B) END USER CLEARING EXEMPTION.— 
‘‘(i) IN
GENERAL.—Subject to clause 
(ii), in the event that a swap is subject to 
the mandatory clearing requirement under 
paragraph (1), and 1 of the counterparties 
to the swap is a commercial end user, that 
counterparty—
573 
† HR 4173 EAS 
‘‘(I)(aa) may elect not to clear the 
swap, as required under paragraph 
(1); or 
‘‘(bb) may elect to require clearing 
of the swap; and 
‘‘(II) if the end user makes an 
election under subclause (I)(bb), shall 
have the sole right to select the deriva-
tives clearing organization at which 
the swap will be cleared. 
‘‘(ii) LIMITATION.—A commercial end 
user may only make an election under 
clause (i) if the end user is using the swap 
to hedge its own commercial risk. 
‘‘(C) TREATMENT OF AFFILIATES.— 
‘‘(i) IN GENERAL.—An affiliate of a 
commercial end user (including affiliate en-
tities predominantly engaged in providing 
financing for the purchase of the merchan-
dise or manufactured goods of the commer-
cial end user) may make an election under 
subparagraph (B)(i) only if the affiliate, 
acting on behalf of the commercial end user 
and as an agent, uses the swap to hedge or 
mitigate the commercial risk of the commer-
574 
† HR 4173 EAS 
cial end user parent or other affiliate of the 
commercial end user that is not a financial 
entity. 
‘‘(ii) PROHIBITION RELATING TO CER-
TAIN AFFILIATES.—An affiliate of a com-
mercial end user shall not use the exemption 
under subparagraph (B) if the affiliate is— 
‘‘(I) a swap dealer; 
‘‘(II) a security-based swap deal-
er; 
‘‘(III) a major swap participant; 
‘‘(IV) a major security-based swap 
participant; 
‘‘(V) an issuer that would be an 
investment company, as defined in sec-
tion 3 of the Investment Company Act 
of 1940 (15 U.S.C. 80a–3), but for 
paragraph (1) or (7) of subsection (c) 
of that Act (15 U.S.C. 80a–3(c)); 
‘‘(VI) a commodity pool; 
‘‘(VII) a bank holding company 
with over $50,000,000,000 in consoli-
dated assets; or
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† HR 4173 EAS 
‘‘(VIII) an affiliate of any entity 
described in subclauses (I) through 
(VII). 
‘‘(D) ABUSE OF EXEMPTION.—The Commis-
sion may prescribe such rules or issue interpre-
tations of the rules as the Commission deter-
mines to be necessary to prevent abuse of the ex-
emption described in subparagraph (B). The 
Commission may also request information from 
those entities claiming the clearing exemption as 
necessary to prevent abuse of the exemption de-
scribed in subparagraph (B). 
‘‘(E) OPTION TO CLEAR.— 
‘‘(i) SWAPS REQUIRED TO BE CLEARED 
ENTERED
INTO
WITH
A
FINANCIAL
ENTI-
TY.—With respect to any swap that is re-
quired to be cleared by a derivatives clear-
ing organization and entered into by a 
swap dealer or a major swap participant 
with a financial entity, the financial entity 
shall have the sole right to select the deriva-
tives clearing organization at which the 
swap will be cleared. 
‘‘(ii) SWAPS
NOT
REQUIRED
TO
BE 
CLEARED ENTERED INTO WITH A FINANCIAL
576 
† HR 4173 EAS 
ENTITY OR COMMERCIAL END USER.—With 
respect to any swap that is not required to 
be cleared by a derivatives clearing organi-
zation and entered into by a swap dealer or 
a major swap participant with a financial 
entity or commercial end user, the financial 
entity or commercial end user— 
‘‘(I) may elect to require clearing 
of the swap; and 
‘‘(II) shall have the sole right to 
select the derivatives clearing organiza-
tion at which the swap will be 
cleared.’’. 
(b) COMMODITY EXCHANGE ACT.—Section 2 of the 
Commodity Exchange Act (7 U.S.C. 2) is amended by add-
ing at the end the following: 
‘‘(j) AUDIT COMMITTEE APPROVAL.—Exemptions from 
the requirements of subsection (h)(2)(F) to clear a swap and 
subsection (b) to trade a swap through a board of trade 
or swap execution facility shall be available to a 
counterparty that is an issuer of securities that are reg-
istered under section 12 of the Securities Exchange Act of 
1934 (15 U.S.C. 78l) or that is required to file reports pur-
suant to section 15(d) of the Securities Exchange Act of 
1934 (15 U.S.C. 78o) only if the issuer’s audit committee
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† HR 4173 EAS 
has reviewed and approved its decision to enter into swaps 
that are subject to such exemptions.’’. 
(c) GRANDFATHER PROVISIONS.— 
(1) LEGAL
CERTAINTY
FOR
CERTAIN
TRANS-
ACTIONS IN EXEMPT COMMODITIES.—Not later than 
60 days after the date of enactment of this Act, a per-
son may submit to the Commodity Futures Trading 
Commission a petition to remain subject to section 
2(h) of the Commodity Exchange Act (7 U.S.C. 2(h)) 
(as in effect on the day before the date of enactment 
of this Act). 
(2) CONSIDERATION; AUTHORITY OF COMMODITY 
FUTURES
TRADING
COMMISSION.—The Commodity 
Futures Trading Commission— 
(A) shall consider any petition submitted 
under subparagraph (A) in a prompt manner; 
and 
(B) may allow a person to continue oper-
ating subject to section 2(h) of the Commodity 
Exchange Act (7 U.S.C. 2(h)) (as in effect on the 
day before the date of enactment of this Act) for 
not longer than a 1-year period. 
(3) AGRICULTURAL SWAPS.— 
(A) IN GENERAL.—Except as provided in 
paragraph (2), no person shall offer to enter
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† HR 4173 EAS 
into, enter into, or confirm the execution of, any 
swap in an agricultural commodity (as defined 
by the Commodity Futures Trading Commis-
sion). 
(B) EXCEPTION.—Notwithstanding para-
graph (1), a person may offer to enter into, enter 
into, or confirm the execution of, any swap in 
an agricultural commodity pursuant to section 
4(c) of the Commodity Exchange Act (7 U.S.C. 
6(c)) or any rule, regulation, or order issued 
thereunder (including any rule, regulation, or 
order in effect as of the date of enactment of this 
Act) by the Commodity Futures Trading Com-
mission to allow swaps under such terms and 
conditions as the Commission shall prescribe. 
(4) REQUIRED REPORTING.—If the exception de-
scribed in paragraph (2) applies, and there is no fa-
cility that makes the swap available to trade, the 
counterparties shall comply with any recordkeeping 
and transaction reporting requirements that may be 
prescribed by the Commission with respect to swaps 
subject to the requirements of paragraph (1).
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† HR 4173 EAS 
SEC. 724. SWAPS; SEGREGATION AND BANKRUPTCY TREAT-
MENT. 
(a) SEGREGATION
REQUIREMENTS
FOR
CLEARED 
SWAPS.—Section 4d of the Commodity Exchange Act (7 
U.S.C. 6d) (as amended by section 732) is amended by add-
ing at the end the following: 
‘‘(f) SWAPS.— 
‘‘(1) REGISTRATION REQUIREMENT.—It shall be 
unlawful for any person to accept any money, securi-
ties, or property (or to extend any credit in lieu of 
money, securities, or property) from, for, or on behalf 
of a swaps customer to margin, guarantee, or secure 
a swap cleared by or through a derivatives clearing 
organization (including money, securities, or property 
accruing to the customer as the result of such a 
swap), unless the person shall have registered under 
this Act with the Commission as a futures commis-
sion merchant, and the registration shall not have ex-
pired nor been suspended nor revoked. 
‘‘(2) CLEARED SWAPS.— 
‘‘(A) SEGREGATION REQUIRED.—A futures 
commission merchant shall treat and deal with 
all money, securities, and property of any swaps 
customer received to margin, guarantee, or secure 
a swap cleared by or though a derivatives clear-
ing organization (including money, securities, or
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† HR 4173 EAS 
property accruing to the swaps customer as the 
result of such a swap) as belonging to the swaps 
customer. 
‘‘(B) COMMINGLING
PROHIBITED.—Money, 
securities, and property of a swaps customer de-
scribed in subparagraph (A) shall be separately 
accounted for and shall not be commingled with 
the funds of the futures commission merchant or 
be used to margin, secure, or guarantee any 
trades or contracts of any swaps customer or 
person other than the person for whom the same 
are held. 
‘‘(3) EXCEPTIONS.— 
‘‘(A) USE OF FUNDS.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
paragraph (2), money, securities, and prop-
erty of a swaps customer of a futures com-
mission merchant described in paragraph 
(2) may, for convenience, be commingled 
and deposited in the same 1 or more ac-
counts with any bank or trust company or 
with a derivatives clearing organization. 
‘‘(ii) WITHDRAWAL.—Notwithstanding 
paragraph (2), such share of the money, se-
curities, and property described in clause
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† HR 4173 EAS 
(i) as in the normal course of business shall 
be necessary to margin, guarantee, secure, 
transfer, adjust, or settle a cleared swap 
with a derivatives clearing organization, or 
with any member of the derivatives clearing 
organization, may be withdrawn and ap-
plied to such purposes, including the pay-
ment of commissions, brokerage, interest, 
taxes, storage, and other charges, lawfully 
accruing in connection with the cleared 
swap. 
‘‘(B) 
COMMISSION
ACTION.—Notwith-
standing paragraph (2), in accordance with such 
terms and conditions as the Commission may 
prescribe by rule, regulation, or order, any 
money, securities, or property of the swaps cus-
tomer of a futures commission merchant de-
scribed in paragraph (2) may be commingled 
and deposited as provided in this section with 
any other money, securities, or property received 
by the futures commission merchant and re-
quired by the Commission to be separately ac-
counted for and treated and dealt with as belong-
ing to the swaps customer of the futures commis-
sion merchant.
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† HR 4173 EAS 
‘‘(4) PERMITTED
INVESTMENTS.—Money de-
scribed in paragraph (2) may be invested in obliga-
tions of the United States, in general obligations of 
any State or of any political subdivision of a State, 
and in obligations fully guaranteed as to principal 
and interest by the United States, or in any other in-
vestment that the Commission may by rule or regula-
tion prescribe, and such investments shall be made in 
accordance with such rules and regulations and sub-
ject to such conditions as the Commission may pre-
scribe. 
‘‘(5) COMMODITY CONTRACT.—A swap cleared by 
or through a derivatives clearing organization shall be 
considered to be a commodity contract as such term 
is defined in section 761 of title 11, United States 
Code, with regard to all money, securities, and prop-
erty of any swaps customer received by a futures com-
mission merchant or a derivatives clearing organiza-
tion to margin, guarantee, or secure the swap (includ-
ing money, securities, or property accruing to the cus-
tomer as the result of the swap). 
‘‘(6) PROHIBITION.—It shall be unlawful for any 
person, including any derivatives clearing organiza-
tion and any depository institution, that has received 
any money, securities, or property for deposit in a
583 
† HR 4173 EAS 
separate account or accounts as provided in para-
graph (2) to hold, dispose of, or use any such money, 
securities, or property as belonging to the depositing 
futures commission merchant or any person other 
than the swaps customer of the futures commission 
merchant.’’. 
(b) BANKRUPTCY TREATMENT OF CLEARED SWAPS.— 
Section 761 of title 11, United States Code, is amended— 
(1) in paragraph (4), by striking subparagraph 
(F) and inserting the following: 
‘‘(F)(i) any other contract, option, agree-
ment, or transaction that is similar to a con-
tract, option, agreement, or transaction referred 
to in this paragraph; and 
‘‘(ii) with respect to a futures commission 
merchant or a clearing organization, any other 
contract, option, agreement, or transaction, in 
each case, that is cleared by a clearing organiza-
tion;’’; and 
(2) in paragraph (9)(A)(i), by striking ‘‘the com-
modity futures account’’ and inserting ‘‘a commodity 
contract account’’. 
(c) SEGREGATION REQUIREMENTS FOR UNCLEARED 
SWAPS.—Section 4s of the Commodity Exchange Act (as
584 
† HR 4173 EAS 
added by section 731) is amended by adding at the end 
the following: 
‘‘(l) SEGREGATION REQUIREMENTS.— 
‘‘(1) SEGREGATION OF ASSETS HELD AS COLLAT-
ERAL IN UNCLEARED SWAP TRANSACTIONS.— 
‘‘(A) NOTIFICATION.—A swap dealer or 
major swap participant shall be required to no-
tify the counterparty of the swap dealer or major 
swap participant at the beginning of a swap 
transaction that the counterparty has the right 
to require segregation of the funds or other prop-
erty supplied to margin, guarantee, or secure the 
obligations of the counterparty. 
‘‘(B) SEGREGATION AND MAINTENANCE OF 
FUNDS.—At the request of a counterparty to a 
swap that provides funds or other property to a 
swap dealer or major swap participant to mar-
gin, guarantee, or secure the obligations of the 
counterparty, the swap dealer or major swap 
participant shall— 
‘‘(i) segregate the funds or other prop-
erty for the benefit of the counterparty; and 
‘‘(ii) in accordance with such rules and 
regulations as the Commission may promul-
gate, maintain the funds or other property
585 
† HR 4173 EAS 
in a segregated account separate from the 
assets and other interests of the swap dealer 
or major swap participant. 
‘‘(2) 
APPLICABILITY.—The 
requirements 
de-
scribed in paragraph (1) shall— 
‘‘(A) apply only to a swap between a 
counterparty and a swap dealer or major swap 
participant that is not submitted for clearing to 
a derivatives clearing organization; and 
‘‘(B)(i) not apply to variation margin pay-
ments; or 
‘‘(ii) not preclude any commercial arrange-
ment regarding— 
‘‘(I) the investment of segregated funds 
or other property that may only be invested 
in such investments as the Commission may 
permit by rule or regulation; and 
‘‘(II) the related allocation of gains 
and losses resulting from any investment of 
the segregated funds or other property. 
‘‘(3) 
USE
OF
INDEPENDENT
THIRD-PARTY 
CUSTODIANS.—The segregated account described in 
paragraph (1) shall be— 
‘‘(A) carried by an independent third-party 
custodian; and
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† HR 4173 EAS 
‘‘(B) designated as a segregated account for 
and on behalf of the counterparty. 
‘‘(4) 
REPORTING
REQUIREMENT.—If 
the 
counterparty does not choose to require segregation of 
the funds or other property supplied to margin, guar-
antee, or secure the obligations of the counterparty, 
the swap dealer or major swap participant shall re-
port to the counterparty of the swap dealer or major 
swap participant on a quarterly basis that the back 
office procedures of the swap dealer or major swap 
participant relating to margin and collateral require-
ments are in compliance with the agreement of the 
counterparties.’’. 
SEC. 725. DERIVATIVES CLEARING ORGANIZATIONS. 
(a) REGISTRATION REQUIREMENT.—Section 5b of the 
Commodity Exchange Act (7 U.S.C. 7a–1) is amended by 
striking subsections (a) and (b) and inserting the following: 
‘‘(a) REGISTRATION REQUIREMENT.— 
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), it shall be unlawful for a derivatives clear-
ing organization, directly or indirectly, to make use 
of the mails or any means or instrumentality of 
interstate commerce to perform the functions of a de-
rivatives clearing organization with respect to—
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† HR 4173 EAS 
‘‘(A) a contract of sale of a commodity for 
future delivery (or an option on the contract of 
sale) or option on a commodity, in each case, 
unless the contract or option is— 
‘‘(i) excluded from this Act by sub-
section (a)(1)(C)(i), (c), or (f) of section 2; 
or 
‘‘(ii) a security futures product cleared 
by a clearing agency registered with the Se-
curities and Exchange Commission under 
the Securities Exchange Act of 1934 (15 
U.S.C. 78a et seq.); or 
‘‘(B) a swap. 
‘‘(2) EXCEPTION.—Paragraph (1) shall not 
apply to a derivatives clearing organization that is 
registered with the Commission. 
‘‘(b) VOLUNTARY
REGISTRATION.—A person that 
clears 1 or more agreements, contracts, or transactions that 
are not required to be cleared under this Act may register 
with the Commission as a derivatives clearing organiza-
tion.’’. 
(b) REGISTRATION
FOR DEPOSITORY INSTITUTIONS 
AND CLEARING AGENCIES; EXEMPTIONS; COMPLIANCE OF-
FICER; ANNUAL REPORTS.—Section 5b of the Commodity
588 
† HR 4173 EAS 
Exchange Act (7 U.S.C. 7a–1) is amended by adding at 
the end the following: 
‘‘(g) REQUIRED REGISTRATION FOR DEPOSITORY IN-
STITUTIONS AND CLEARING AGENCIES.—A person that is 
required to be registered as a derivatives clearing organiza-
tion under this section shall register with the Commission 
regardless of whether the person is also licensed as a deposi-
tory institution (as that term is defined in section 3 of the 
Federal Deposit Insurance Act (12 U.S.C. 1813) or a clear-
ing agency registered with the Securities and Exchange 
Commission under the Securities Exchange Act of 1934 (15 
U.S.C. 78a et seq.). 
‘‘(h) EXISTING
DEPOSITORY
INSTITUTIONS
AND 
CLEARING AGENCIES.— 
‘‘(1) IN GENERAL.—A depository institution or 
clearing agency registered with the Securities and Ex-
change Commission under the Securities Exchange 
Act of 1934 (15 U.S.C. 78a et seq.) that is required 
to be registered as a derivatives clearing organization 
under this section is deemed to be registered under 
this section to the extent that, before the date of enact-
ment of this subsection— 
‘‘(A) the depository institution cleared 
swaps as a multilateral clearing organization; or 
‘‘(B) the clearing agency cleared swaps.
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† HR 4173 EAS 
‘‘(2) CONVERSION
OF
DEPOSITORY
INSTITU-
TIONS.—A depository institution to which this para-
graph applies may, by the vote of the shareholders 
owning not less than 51 percent of the voting interests 
of the depository institution, be converted into a State 
corporation, partnership, limited liability company, 
or similar legal form pursuant to a plan of conver-
sion, if the conversion is not in contravention of ap-
plicable State law. 
‘‘(i) EXEMPTIONS.—The Commission may exempt, 
conditionally or unconditionally, a derivatives clearing or-
ganization from registration under this section for the 
clearing of swaps if the Commission determines that the de-
rivatives clearing organization is subject to comparable, 
comprehensive supervision and regulation by the Securities 
and Exchange Commission or the appropriate government 
authorities in the home country of the organization. Such 
conditions may include, but are not limited to, requiring 
that the derivatives clearing organization be available for 
inspection by the Commission and make available all infor-
mation requested by the Commission. 
‘‘(j) DESIGNATION OF CHIEF COMPLIANCE OFFICER.— 
‘‘(1) IN GENERAL.—Each derivatives clearing or-
ganization shall designate an individual to serve as 
a chief compliance officer.
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† HR 4173 EAS 
‘‘(2) DUTIES.—The chief compliance officer 
shall— 
‘‘(A) report directly to the board or to the 
senior officer of the derivatives clearing organi-
zation; 
‘‘(B) review the compliance of the deriva-
tives clearing organization with respect to the 
core principles described in subsection (c)(2); 
‘‘(C) in consultation with the board of the 
derivatives clearing organization, a body per-
forming a function similar to the board of the 
derivatives clearing organization, or the senior 
officer of the derivatives clearing organization, 
resolve any conflicts of interest that may arise; 
‘‘(D) be responsible for administering each 
policy and procedure that is required to be estab-
lished pursuant to this section; 
‘‘(E) ensure compliance with this Act (in-
cluding regulations) relating to agreements, con-
tracts, or transactions, including each rule pre-
scribed by the Commission under this section; 
‘‘(F) establish procedures for the remedi-
ation of noncompliance issues identified by the 
compliance officer through any— 
‘‘(i) compliance office review;
591 
† HR 4173 EAS 
‘‘(ii) look-back; 
‘‘(iii) internal or external audit find-
ing; 
‘‘(iv) self-reported error; or 
‘‘(v) validated complaint; and 
‘‘(G) establish and follow appropriate proce-
dures for the handling, management response, re-
mediation, retesting, and closing of noncompli-
ance issues. 
‘‘(3) ANNUAL REPORTS.— 
‘‘(A) IN
GENERAL.—In accordance with 
rules prescribed by the Commission, the chief 
compliance officer shall annually prepare and 
sign a report that contains a description of— 
‘‘(i) the compliance of the derivatives 
clearing organization of the compliance offi-
cer with respect to this Act (including regu-
lations); and 
‘‘(ii) each policy and procedure of the 
derivatives clearing organization of the 
compliance officer (including the code of 
ethics and conflict of interest policies of the 
derivatives clearing organization). 
‘‘(B) REQUIREMENTS.—A compliance re-
port under subparagraph (A) shall—
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† HR 4173 EAS 
‘‘(i) accompany each appropriate fi-
nancial report of the derivatives clearing or-
ganization that is required to be furnished 
to the Commission pursuant to this section; 
and 
‘‘(ii) include a certification that, under 
penalty of law, the compliance report is ac-
curate and complete.’’. 
(c) CORE PRINCIPLES FOR DERIVATIVES CLEARING 
ORGANIZATIONS.—Section 5b(c) of the Commodity Ex-
change Act (7 U.S.C. 7a–1(c)) is amended by striking para-
graph (2) and inserting the following: 
‘‘(2) CORE PRINCIPLES FOR DERIVATIVES CLEAR-
ING ORGANIZATIONS.— 
‘‘(A) COMPLIANCE.— 
‘‘(i) IN
GENERAL.—To be registered 
and to maintain registration as a deriva-
tives clearing organization, a derivatives 
clearing organization shall comply with 
each core principle described in this para-
graph and any requirement that the Com-
mission may impose by rule or regulation 
pursuant to section 8a(5). 
‘‘(ii) DISCRETION
OF
DERIVATIVES 
CLEARING ORGANIZATION.—Subject to any
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† HR 4173 EAS 
rule or regulation prescribed by the Com-
mission, a derivatives clearing organization 
shall have reasonable discretion in estab-
lishing the manner by which the derivatives 
clearing organization complies with each 
core principle described in this paragraph. 
‘‘(B) FINANCIAL RESOURCES.— 
‘‘(i) IN
GENERAL.—Each derivatives 
clearing organization shall have adequate 
financial, operational, and managerial re-
sources, as determined by the Commission, 
to discharge each responsibility of the de-
rivatives clearing organization. 
‘‘(ii) MINIMUM AMOUNT OF FINANCIAL 
RESOURCES.—Each derivatives clearing or-
ganization shall possess financial resources 
that, at a minimum, exceed the total 
amount that would— 
‘‘(I) enable the organization to 
meet its financial obligations to its 
members and participants notwith-
standing a default by the member or 
participant creating the largest finan-
cial exposure for that organization in
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† HR 4173 EAS 
extreme but plausible market condi-
tions; and 
‘‘(II) enable the derivatives clear-
ing organization to cover the operating 
costs of the derivatives clearing organi-
zation for a period of 1 year (as cal-
culated on a rolling basis). 
‘‘(C) PARTICIPANT
AND
PRODUCT
ELIGI-
BILITY.— 
‘‘(i) IN
GENERAL.—Each derivatives 
clearing organization shall establish— 
‘‘(I) appropriate admission and 
continuing eligibility standards (in-
cluding sufficient financial resources 
and operational capacity to meet obli-
gations arising from participation in 
the derivatives clearing organization) 
for members of, and participants in, 
the derivatives clearing organization; 
and 
‘‘(II) appropriate standards for 
determining the eligibility of agree-
ments, contracts, and transactions sub-
mitted to the derivatives clearing orga-
nization for clearing.
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† HR 4173 EAS 
‘‘(ii) REQUIRED
PROCEDURES.—Each 
derivatives clearing organization shall es-
tablish and implement procedures to verify, 
on an ongoing basis, the compliance of each 
participation and membership requirement 
of the derivatives clearing organization. 
‘‘(iii) REQUIREMENTS.—The partici-
pation and membership requirements of 
each 
derivatives 
clearing 
organization 
shall— 
‘‘(I) be objective; 
‘‘(II) be publicly disclosed; and 
‘‘(III) permit fair and open ac-
cess. 
‘‘(D) RISK MANAGEMENT.— 
‘‘(i) IN
GENERAL.—Each derivatives 
clearing organization shall ensure that the 
derivatives clearing organization possesses 
the ability to manage the risks associated 
with discharging the responsibilities of the 
derivatives clearing organization through 
the use of appropriate tools and procedures. 
‘‘(ii) MEASUREMENT OF CREDIT EXPO-
SURE.—Each derivatives clearing organiza-
tion shall—
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† HR 4173 EAS 
‘‘(I) not less than once during 
each business day of the derivatives 
clearing organization, measure the 
credit exposures of the derivatives 
clearing organization to each member 
and participant of the derivatives 
clearing organization; and 
‘‘(II) monitor each exposure de-
scribed in subclause (I) periodically 
during the business day of the deriva-
tives clearing organization. 
‘‘(iii) LIMITATION
OF
EXPOSURE
TO 
POTENTIAL
LOSSES
FROM
DEFAULTS.— 
Each derivatives clearing organization, 
through margin requirements and other risk 
control mechanisms, shall limit the exposure 
of the derivatives clearing organization to 
potential losses from defaults by members 
and participants of the derivatives clearing 
organization to ensure that— 
‘‘(I) the operations of the deriva-
tives clearing organization would not 
be disrupted; and 
‘‘(II) nondefaulting members or 
participants would not be exposed to
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† HR 4173 EAS 
losses that nondefaulting members or 
participants cannot anticipate or con-
trol. 
‘‘(iv) MARGIN
REQUIREMENTS.—The 
margin required from each member and 
participant of a derivatives clearing organi-
zation shall be sufficient to cover potential 
exposures in normal market conditions. 
‘‘(v) REQUIREMENTS REGARDING MOD-
ELS AND PARAMETERS.—Each model and 
parameter used in setting margin require-
ments under clause (iv) shall be— 
‘‘(I) risk-based; and 
‘‘(II) reviewed on a regular basis. 
‘‘(E) SETTLEMENT PROCEDURES.—Each de-
rivatives clearing organization shall— 
‘‘(i) complete money settlements on a 
timely basis (but not less frequently than 
once each business day); 
‘‘(ii) employ money settlement ar-
rangements to eliminate or strictly limit the 
exposure of the derivatives clearing organi-
zation to settlement bank risks (including 
credit and liquidity risks from the use of 
banks to effect money settlements);
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† HR 4173 EAS 
‘‘(iii) ensure that money settlements 
are final when effected; 
‘‘(iv) maintain an accurate record of 
the flow of funds associated with each 
money settlement; 
‘‘(v) possess the ability to comply with 
each term and condition of any permitted 
netting or offset arrangement with any 
other clearing organization; 
‘‘(vi) regarding physical settlements, 
establish rules that clearly state each obliga-
tion of the derivatives clearing organization 
with respect to physical deliveries; and 
‘‘(vii) ensure that each risk arising 
from an obligation described in clause (vi) 
is identified and managed. 
‘‘(F) TREATMENT OF FUNDS.— 
‘‘(i) REQUIRED STANDARDS AND PRO-
CEDURES.—Each derivatives clearing orga-
nization shall establish standards and pro-
cedures that are designed to protect and en-
sure the safety of member and participant 
funds and assets. 
‘‘(ii) HOLDING
OF
FUNDS
AND
AS-
SETS.—Each derivatives clearing organiza-
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† HR 4173 EAS 
tion shall hold member and participant 
funds and assets in a manner by which to 
minimize the risk of loss or of delay in the 
access by the derivatives clearing organiza-
tion to the assets and funds. 
‘‘(iii) PERMISSIBLE
INVESTMENTS.— 
Funds and assets invested by a derivatives 
clearing organization shall be held in in-
struments with minimal credit, market, and 
liquidity risks. 
‘‘(G) DEFAULT RULES AND PROCEDURES.— 
‘‘(i) IN
GENERAL.—Each derivatives 
clearing organization shall have rules and 
procedures designed to allow for the effi-
cient, fair, and safe management of events 
during which members or participants— 
‘‘(I) become insolvent; or 
‘‘(II) otherwise default on the obli-
gations of the members or participants 
to the derivatives clearing organiza-
tion. 
‘‘(ii) DEFAULT
PROCEDURES.—Each 
derivatives clearing organization shall—
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† HR 4173 EAS 
‘‘(I) clearly state the default pro-
cedures of the derivatives clearing or-
ganization; 
‘‘(II) make publicly available the 
default rules of the derivatives clearing 
organization; and 
‘‘(III) ensure that the derivatives 
clearing organization may take timely 
action— 
‘‘(aa) to contain losses and 
liquidity pressures; and 
‘‘(bb) to continue meeting 
each obligation of the derivatives 
clearing organization. 
‘‘(H) RULE ENFORCEMENT.—Each deriva-
tives clearing organization shall— 
‘‘(i) maintain adequate arrangements 
and resources for— 
‘‘(I) the effective monitoring and 
enforcement of compliance with the 
rules of the derivatives clearing organi-
zation; and 
‘‘(II) the resolution of disputes; 
‘‘(ii) have the authority and ability to 
discipline, limit, suspend, or terminate the
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† HR 4173 EAS 
activities of a member or participant due to 
a violation by the member or participant of 
any rule of the derivatives clearing organi-
zation; and 
‘‘(iii) report to the Commission regard-
ing rule enforcement activities and sanc-
tions imposed against members and partici-
pants as provided in clause (ii). 
‘‘(I) SYSTEM
SAFEGUARDS.—Each deriva-
tives clearing organization shall— 
‘‘(i) establish and maintain a program 
of risk analysis and oversight to identify 
and minimize sources of operational risk 
through the development of appropriate con-
trols and procedures, and automated sys-
tems, that are reliable, secure, and have 
adequate scalable capacity; 
‘‘(ii) establish and maintain emergency 
procedures, backup facilities, and a plan for 
disaster recovery that allows for— 
‘‘(I) the timely recovery and re-
sumption of operations of the deriva-
tives clearing organization; and
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† HR 4173 EAS 
‘‘(II) the fulfillment of each obli-
gation and responsibility of the deriva-
tives clearing organization; and 
‘‘(iii) periodically conduct tests to 
verify that the backup resources of the de-
rivatives clearing organization are suffi-
cient to ensure daily processing, clearing, 
and settlement. 
‘‘(J) REPORTING.—Each derivatives clear-
ing organization shall provide to the Commis-
sion all information that the Commission deter-
mines to be necessary to conduct oversight of the 
derivatives clearing organization. 
‘‘(K) RECORDKEEPING.—Each derivatives 
clearing organization shall maintain records of 
all activities related to the business of the deriva-
tives clearing organization as a derivatives clear-
ing organization— 
‘‘(i) in a form and manner that is ac-
ceptable to the Commission; and 
‘‘(ii) for a period of not less than 5 
years. 
‘‘(L) PUBLIC INFORMATION.— 
‘‘(i) IN
GENERAL.—Each derivatives 
clearing organization shall provide to mar-
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† HR 4173 EAS 
ket participants sufficient information to 
enable the market participants to identify 
and evaluate accurately the risks and costs 
associated with using the services of the de-
rivatives clearing organization. 
‘‘(ii) 
AVAILABILITY
OF
INFORMA-
TION.—Each derivatives clearing organiza-
tion shall make information concerning the 
rules and operating procedures governing 
the clearing and settlement systems of the 
derivatives clearing organization available 
to market participants. 
‘‘(iii) PUBLIC DISCLOSURE.—Each de-
rivatives clearing organization shall disclose 
publicly and to the Commission informa-
tion concerning— 
‘‘(I) the terms and conditions of 
each contract, agreement, and other 
transaction cleared and settled by the 
derivatives clearing organization; 
‘‘(II) each clearing and other fee 
that the derivatives clearing organiza-
tion charges the members and partici-
pants of the derivatives clearing orga-
nization;
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† HR 4173 EAS 
‘‘(III) the margin-setting method-
ology, and the size and composition, of 
the financial resource package of the 
derivatives clearing organization; 
‘‘(IV) daily settlement prices, vol-
ume, and open interest for each con-
tract settled or cleared by the deriva-
tives clearing organization; and 
‘‘(V) any other matter relevant to 
participation in the settlement and 
clearing activities of the derivatives 
clearing organization. 
‘‘(M) 
INFORMATION-SHARING.—Each 
de-
rivatives clearing organization shall— 
‘‘(i) enter into, and abide by the terms 
of, each appropriate and applicable domes-
tic and international information-sharing 
agreement; and 
‘‘(ii) use relevant information obtained 
from each agreement described in clause (i) 
in carrying out the risk management pro-
gram of the derivatives clearing organiza-
tion. 
‘‘(N) ANTITRUST CONSIDERATIONS.—Unless 
necessary or appropriate to achieve the purposes
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† HR 4173 EAS 
of this Act, a derivatives clearing organization 
shall not— 
‘‘(i) adopt any rule or take any action 
that results in any unreasonable restraint of 
trade; or 
‘‘(ii) impose any material anticompeti-
tive burden. 
‘‘(O) GOVERNANCE FITNESS STANDARDS.— 
‘‘(i) GOVERNANCE
ARRANGEMENTS.— 
Each derivatives clearing organization shall 
establish governance arrangements that are 
transparent— 
‘‘(I) to fulfill public interest re-
quirements; and 
‘‘(II) to support the objectives of 
owners and participants. 
‘‘(ii) FITNESS STANDARDS.—Each de-
rivatives clearing organization shall estab-
lish and enforce appropriate fitness stand-
ards for— 
‘‘(I) directors; 
‘‘(II) members of any disciplinary 
committee; 
‘‘(III) members of the derivatives 
clearing organization;
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† HR 4173 EAS 
‘‘(IV) any other individual or en-
tity with direct access to the settlement 
or clearing activities of the derivatives 
clearing organization; and 
‘‘(V) any party affiliated with 
any individual or entity described in 
this clause. 
‘‘(P) CONFLICTS OF INTEREST.—Each de-
rivatives clearing organization shall— 
‘‘(i) establish and enforce rules to min-
imize conflicts of interest in the decision- 
making process of the derivatives clearing 
organization; and 
‘‘(ii) establish a process for resolving 
conflicts of interest described in clause (i). 
‘‘(Q) 
COMPOSITION
OF
GOVERNING 
BOARDS.—Each derivatives clearing organiza-
tion shall ensure that the composition of the gov-
erning board or committee of the derivatives 
clearing organization includes market partici-
pants. 
‘‘(R) LEGAL RISK.—Each derivatives clear-
ing organization shall have a well-founded, 
transparent, and enforceable legal framework for
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† HR 4173 EAS 
each aspect of the activities of the derivatives 
clearing organization. 
‘‘(S) 
MODIFICATION
OF
CORE
PRIN-
CIPLES.—The Commission may conform the core 
principles established in this paragraph to reflect 
evolving United States and international stand-
ards.’’. 
(d) CONFLICTS OF INTEREST.—The Commodity Fu-
tures Trading Commission shall adopt rules mitigating 
conflicts of interest in connection with the conduct of busi-
ness by a swap dealer or a major swap participant with 
a derivatives clearing organization, board of trade, or a 
swap execution facility that clears or trades swaps in which 
the swap dealer or major swap participant has a material 
debt or material equity investment. 
(e) REPORTING REQUIREMENTS.—Section 5b of the 
Commodity Exchange Act (7 U.S.C. 7a–1) (as amended by 
subsection (b)) is amended by adding at the end the fol-
lowing: 
‘‘(k) REPORTING REQUIREMENTS.— 
‘‘(1) DUTY OF DERIVATIVES CLEARING ORGANI-
ZATIONS.—Each derivatives clearing organization 
that clears swaps shall provide to the Commission all 
information that is determined by the Commission to
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† HR 4173 EAS 
be necessary to perform each responsibility of the 
Commission under this Act. 
‘‘(2) DATA COLLECTION AND MAINTENANCE RE-
QUIREMENTS.—The Commission shall adopt data col-
lection and maintenance requirements for swaps 
cleared by derivatives clearing organizations that are 
comparable to the corresponding requirements for— 
‘‘(A) swaps data reported to swap data re-
positories; and 
‘‘(B) swaps traded on swap execution facili-
ties. 
‘‘(3) 
REPORTS
ON
SECURITY-BASED
SWAP 
AGREEMENTS TO BE SHARED WITH THE SECURITIES 
AND EXCHANGE COMMISSION.— 
‘‘(A) IN GENERAL.—A derivatives clearing 
organization that clears security-based swap 
agreements (as defined in section 3(a)(79) of the 
Securities Exchange Act) shall, upon request, 
make available to the Securities and Exchange 
Commission all books and records relating to 
such security-based swap agreements, consistent 
with the confidentiality and disclosure require-
ments of section 8. 
‘‘(B) JURISDICTION.—Nothing in this para-
graph shall affect the exclusive jurisdiction of the
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† HR 4173 EAS 
Commission to prescribe recordkeeping and re-
porting requirements for a derivatives clearing 
organization that is registered with the Commis-
sion.’’ 
‘‘(4) INFORMATION SHARING.—Subject to section 
8, and upon request, the Commission shall share in-
formation collected under paragraph (2) with— 
‘‘(A) the Board; 
‘‘(B) the Securities and Exchange Commis-
sion; 
‘‘(C) each appropriate prudential regulator; 
‘‘(D) the Financial Stability Oversight 
Council; 
‘‘(E) the Department of Justice; and 
‘‘(F) any other person that the Commission 
determines to be appropriate, including— 
‘‘(i) foreign financial supervisors (in-
cluding foreign futures authorities); 
‘‘(ii) foreign central banks; and 
‘‘(iii) foreign ministries. 
‘‘(5) CONFIDENTIALITY
AND
INDEMNIFICATION 
AGREEMENT.—Before the Commission may share in-
formation with any entity described in paragraph 
(4)—
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† HR 4173 EAS 
‘‘(A) the Commission shall receive a written 
agreement from each entity stating that the enti-
ty shall abide by the confidentiality requirements 
described in section 8 relating to the information 
on swap transactions that is provided; and 
‘‘(B) each entity shall agree to indemnify 
the Commission for any expenses arising from 
litigation relating to the information provided 
under section 8. 
‘‘(6) PUBLIC
INFORMATION.—Each derivatives 
clearing organization that clears swaps shall provide 
to the Commission (including any designee of the 
Commission) information under paragraph (2) in 
such form and at such frequency as is required by the 
Commission to comply with the public reporting re-
quirements contained in section 2(a)(13).’’. 
(f) PUBLIC DISCLOSURE.—Section 8(e) of the Com-
modity Exchange Act (7 U.S.C. 12(e)) is amended in the 
last sentence— 
(1) by inserting ‘‘, central bank and ministries,’’ 
after ‘‘department’’ each place it appears; and 
(2) by striking ‘‘. is a party.’’ and inserting ‘‘, 
is a party.’’. 
(g) LEGAL CERTAINTY
FOR IDENTIFIED BANKING 
PRODUCTS.—
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† HR 4173 EAS 
(1) REPEALS.—The Legal Certainty for Bank 
Products Act of 2000 (7 U.S.C. 27 et seq.) is amend-
ed— 
(A) by striking sections 404 and 407 (7 
U.S.C. 27b, 27e); 
(B) in section 402 (7 U.S.C. 27), by strik-
ing subsection (d); and 
(C) in section 408 (7 U.S.C. 27f)— 
(i) in subsection (c)— 
(I) by striking ‘‘in the case’’ and 
all that follows through ‘‘a hybrid’’ and 
inserting ‘‘in the case of a hybrid’’; 
(II) by striking ‘‘; or’’ and insert-
ing a period; and 
(III) by striking paragraph (2); 
(ii) by striking subsection (b); and 
(iii) by redesignating subsection (c) as 
subsection (b). 
(2) LEGAL CERTAINTY FOR BANK PRODUCTS ACT 
OF
2000.—Section 403 of the Legal Certainty for 
Bank Products Act of 2000 (7 U.S.C. 27a) is amend-
ed to read as follows: 
‘‘SEC. 403. EXCLUSION OF IDENTIFIED BANKING PRODUCT. 
‘‘(a) EXCLUSION.—Except as provided in subsection 
(b) or (c)—
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† HR 4173 EAS 
‘‘(1) the Commodity Exchange Act (7 U.S.C. 1 
et seq.) shall not apply to, and the Commodity Fu-
tures Trading Commission shall not exercise regu-
latory authority under the Commodity Exchange Act 
(7 U.S.C. 1 et seq.) with respect to, an identified 
banking product; and 
‘‘(2) the definitions of ‘security-based swap’ in 
section 3(a)(68) of the Securities Exchange Act of 
1934 and ‘security-based swap agreement’ in section 
3(a)(79) of the Securities Exchange Act of 1934 do 
not include any identified bank product. 
‘‘(b) EXCEPTION.—An appropriate Federal banking 
agency may except an identified banking product of a bank 
under its regulatory jurisdiction from the exclusion in sub-
section (a) if the agency determines, in consultation with 
the Commodity Futures Trading Commission and the Secu-
rities and Exchange Commission, that the product— 
‘‘(1) would meet the definition of a ‘swap’ under 
section 1a(46) of the Commodity Exchange Act (7 
U.S.C. 1a) or a ‘security-based swap’ under that sec-
tion 3(a)(68) of the Securities Exchange Act of 1934; 
and 
‘‘(2) has become known to the trade as a swap 
or security-based swap, or otherwise has been struc-
tured as an identified banking product for the pur-
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† HR 4173 EAS 
pose of evading the provisions of the Commodity Ex-
change Act (7 U.S.C. 1 et seq.), the Securities Act of 
1933 (15 U.S.C. 77a et seq.), or the Securities Ex-
change Act of 1934 (15 U.S.C. 78a et seq.). 
‘‘(c) EXCEPTION.—The exclusions in subsection (a) 
shall not apply to an identified bank product that— 
‘‘(1) is a product of a bank that is not under the 
regulatory jurisdiction of an appropriate Federal 
banking agency; 
‘‘(2) meets the definition of swap in section 
1a(46) of the Commodity Exchange Act or security- 
based swap in section 3(a)(68) of the Securities Ex-
change Act of 1934; and 
‘‘(3) has become known to the trade as a swap 
or security-based swap, or otherwise has been struc-
tured as an identified banking product for the pur-
pose of evading the provisions of the Commodity Ex-
change Act (7 U.S.C. 1 et seq.), the Securities Act of 
1933 (15 U.S.C. 77a et seq.), or the Securities Ex-
change Act of 1934 (15 U.S.C. 78a et seq.).’’. 
SEC. 726. RULEMAKING ON CONFLICT OF INTEREST. 
(a) IN GENERAL.—Not later than 180 days after the 
date of enactment of the Wall Street Transparency and Ac-
countability Act of 2010, the Commodity Futures Trading 
Commission shall determine whether to adopt rules to estab-
614 
† HR 4173 EAS 
lish limits on the control of any derivatives clearing organi-
zation that clears swaps, or swap execution facility or board 
of trade designated as a contract market that posts swaps 
or makes swaps available for trading, by a bank holding 
company (as defined in section 2 of the Bank Holding Com-
pany Act of 1956 (12 U.S.C. 1841)) with total consolidated 
assets of $50,000,000,000 or more, a nonbank financial 
company (as defined in section 102) supervised by the 
Board of Governors of the Federal Reserve System, an affil-
iate of such a bank holding company or nonbank financial 
company, a swap dealer, major swap participant, or associ-
ated person of a swap dealer or major swap participant. 
(b) PURPOSES.—The Commission shall adopt rules if 
it determines, after the review described in subsection (a), 
that such rules are necessary or appropriate to improve the 
governance of, or to mitigate systemic risk, promote com-
petition, or mitigate conflicts of interest in connection with 
a swap dealer or major swap participant’s conduct of busi-
ness with, a derivatives clearing organization, contract 
market, or swap execution facility that clears or posts swaps 
or makes swaps available for trading and in which such 
swap dealer or major swap participant has a material debt 
or equity investment.
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† HR 4173 EAS 
SEC. 727. PUBLIC REPORTING OF SWAP TRANSACTION 
DATA. 
Section 2(a) of the Commodity Exchange Act (7 U.S.C. 
2(a)) is amended by adding at the end the following: 
‘‘(13) PUBLIC
AVAILABILITY
OF
SWAP
TRANS-
ACTION DATA.— 
‘‘(A) DEFINITION OF REAL-TIME PUBLIC RE-
PORTING.—In this paragraph, the term ‘real- 
time public reporting’ means to report data re-
lating to a swap transaction as soon as techno-
logically practicable after the time at which the 
swap transaction has been executed. 
‘‘(B) PURPOSE.—The purpose of this section 
is to authorize the Commission to make swap 
transaction and pricing data available to the 
public in such form and at such times as the 
Commission determines appropriate to enhance 
price discovery. 
‘‘(C) GENERAL RULE.—The Commission is 
authorized and required to provide by rule for 
the public availability of swap transaction and 
pricing data as follows: 
‘‘(i) With respect to those swaps that 
are subject to the mandatory clearing re-
quirement described in subsection (h)(2) 
(including those swaps that are exempted
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† HR 4173 EAS 
from the requirement pursuant to subsection 
(h)(10)), the Commission shall require real- 
time public reporting for such transactions. 
‘‘(ii) With respect to those swaps that 
are not subject to the mandatory clearing 
requirement described in subsection (h)(2), 
but are cleared at a registered derivatives 
clearing organization, the Commission shall 
require real-time public reporting for such 
transactions. 
‘‘(iii) With respect to swaps that are 
not cleared at a registered derivatives clear-
ing organization and which are reported to 
a swap data repository or the Commission 
under subsection (h), the Commission shall 
make available to the public, in a manner 
that does not disclose the business trans-
actions and market positions of any person, 
aggregate data on such swap trading vol-
umes and positions. 
‘‘(iv) With respect to swaps that are 
exempt from the requirements of subsection 
(h)(1), pursuant to subsection (h)(10), the 
Commission shall require real-time public 
reporting for such transactions.
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† HR 4173 EAS 
‘‘(D) REGISTERED
ENTITIES
AND
PUBLIC 
REPORTING.—The Commission may require reg-
istered entities to publicly disseminate the swap 
transaction and pricing data required to be re-
ported under this paragraph. 
‘‘(E) RULEMAKING
REQUIRED.—With re-
spect to the rule providing for the public avail-
ability of transaction and pricing data for swaps 
described in clauses (i) and (ii) of subparagraph 
(C), the rule promulgated by the Commission 
shall contain provisions— 
‘‘(i) to ensure such information does 
not identify the participants; 
‘‘(ii) to specify the criteria for deter-
mining what constitutes a large notional 
swap transaction (block trade) for par-
ticular markets and contracts; 
‘‘(iii) to specify the appropriate time 
delay for reporting large notional swap 
transactions (block trades) to the public; 
and 
‘‘(iv) that take into account whether 
the public disclosure will materially reduce 
market liquidity.
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† HR 4173 EAS 
‘‘(F) TIMELINESS OF REPORTING.—Parties 
to a swap (including agents of the parties to a 
swap) shall be responsible for reporting swap 
transaction information to the appropriate reg-
istered entity in a timely manner as may be pre-
scribed by the Commission. 
‘‘(14) SEMIANNUAL
AND
ANNUAL
PUBLIC
RE-
PORTING OF AGGREGATE SWAP DATA.— 
‘‘(A) IN
GENERAL.—In accordance with 
subparagraph (B), the Commission shall issue a 
written report on a semiannual and annual 
basis to make available to the public information 
relating to— 
‘‘(i) the trading and clearing in the 
major swap categories; and 
‘‘(ii) the market participants and de-
velopments in new products. 
‘‘(B) USE; CONSULTATION.—In preparing a 
report under subparagraph (A), the Commission 
shall— 
‘‘(i) use information from swap data 
repositories and derivatives clearing organi-
zations; and 
‘‘(ii) consult with the Office of the 
Comptroller of the Currency, the Bank for
619 
† HR 4173 EAS 
International Settlements, and such other 
regulatory bodies as may be necessary.’’. 
SEC. 728. SWAP DATA REPOSITORIES. 
The Commodity Exchange Act is amended by inserting 
after section 20 (7 U.S.C. 24) the following: 
‘‘SEC. 21. SWAP DATA REPOSITORIES. 
‘‘(a) REGISTRATION REQUIREMENT.— 
‘‘(1) IN GENERAL.—It shall be unlawful for any 
person, unless registered with the Commission, di-
rectly or indirectly to make use of the mails or any 
means or instrumentality of interstate commerce to 
perform the functions of a swap data repository. 
‘‘(2) INSPECTION AND EXAMINATION.—Each reg-
istered swap data repository shall be subject to inspec-
tion and examination by any representative of the 
Commission. 
‘‘(3) COMPLIANCE WITH CORE PRINCIPLES.— 
‘‘(A) IN GENERAL.—To be registered, and 
maintain registration, as a swap data reposi-
tory, the swap data repository shall comply 
with— 
‘‘(i) the core principles described in 
this subsection; and
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† HR 4173 EAS 
‘‘(ii) any requirement that the Com-
mission may impose by rule or regulation 
pursuant to section 8a(5). 
‘‘(B) REASONABLE
DISCRETION
OF
SWAP 
DATA REPOSITORY.—Unless otherwise determined 
by the Commission by rule or regulation, a swap 
data repository described in subparagraph (A) 
shall have reasonable discretion in establishing 
the manner in which the swap data repository 
complies with the core principles described in 
this subsection. 
‘‘(b) STANDARD SETTING.— 
‘‘(1) DATA
IDENTIFICATION.—The Commission 
shall prescribe standards that specify the data ele-
ments for each swap that shall be collected and main-
tained by each registered swap data repository. 
‘‘(2) DATA
COLLECTION
AND
MAINTENANCE.— 
The Commission shall prescribe data collection and 
data maintenance standards for swap data reposi-
tories. 
‘‘(3) COMPARABILITY.—The standards prescribed 
by the Commission under this subsection shall be com-
parable to the data standards imposed by the Com-
mission on derivatives clearing organizations in con-
nection with their clearing of swaps.
621 
† HR 4173 EAS 
‘‘(4) SHARING OF INFORMATION WITH SECURI-
TIES AND EXCHANGE COMMISSION.—Registered swap 
data repositories shall make available to the Securi-
ties and Exchange Commission, upon request, all 
books and records relating to security-based swap 
agreements that are maintained by such swap data 
repository, consistent with the confidentiality and 
disclosure requirements of section 8. Nothing in this 
paragraph shall affect the exclusive jurisdiction of the 
Commission to prescribe recordkeeping and reporting 
requirements for a swap data repository that is reg-
istered with the Commission. 
‘‘(c) DUTIES.—A swap data repository shall— 
‘‘(1) accept data prescribed by the Commission 
for each swap under subsection (b); 
‘‘(2) confirm with both counterparties to the 
swap the accuracy of the data that was submitted; 
‘‘(3) maintain the data described in paragraph 
(1) in such form, in such manner, and for such pe-
riod as may be required by the Commission; 
‘‘(4)(A) provide direct electronic access to the 
Commission (or any designee of the Commission, in-
cluding another registered entity); and 
‘‘(B) provide the information described in para-
graph (1) in such form and at such frequency as the
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† HR 4173 EAS 
Commission may require to comply with the public 
reporting requirements contained in section 2(a)(13); 
‘‘(5) at the direction of the Commission, establish 
automated systems for monitoring, screening, and 
analyzing swap data, including compliance and fre-
quency of end user clearing exemption claims by indi-
vidual and affiliated entities; 
‘‘(6) maintain the privacy of any and all swap 
transaction information that the swap data reposi-
tory receives from a swap dealer, counterparty, or 
any other registered entity; and 
‘‘(7) on a confidential basis pursuant to section 
8, upon request, and after notifying the Commission 
of the request, make available all data obtained by the 
swap 
data 
repository, 
including 
individual 
counterparty trade and position data, to— 
‘‘(A) each appropriate prudential regulator; 
‘‘(B) the Financial Stability Oversight 
Council; 
‘‘(C) the Securities and Exchange Commis-
sion; 
‘‘(D) the Department of Justice; and 
‘‘(E) any other person that the Commission 
determines to be appropriate, including—
623 
† HR 4173 EAS 
‘‘(i) foreign financial supervisors (in-
cluding foreign futures authorities); 
‘‘(ii) foreign central banks; 
‘‘(iii) foreign ministries; and 
‘‘(8) establish and maintain emergency proce-
dures, backup facilities, and a plan for disaster recov-
ery that allows for the timely recovery and resump-
tion of operations and the fulfillment of the respon-
sibilities and obligations of the organization. 
‘‘(d) CONFIDENTIALITY AND INDEMNIFICATION AGREE-
MENT.—Before the swap data repository may share infor-
mation with any entity described above— 
‘‘(1) the swap data repository shall receive a 
written agreement from each entity stating that the 
entity shall abide by the confidentiality requirements 
described in section 8 relating to the information on 
swap transactions that is provided; and 
‘‘(2) each entity shall agree to indemnify the 
swap data repository and the Commission for any ex-
penses arising from litigation relating to the informa-
tion provided under section 8. 
‘‘(e) DESIGNATION
OF CHIEF COMPLIANCE OFFI-
CER.—
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† HR 4173 EAS 
‘‘(1) IN GENERAL.—Each swap data repository 
shall designate an individual to serve as a chief com-
pliance officer. 
‘‘(2) DUTIES.—The chief compliance officer 
shall— 
‘‘(A) report directly to the board or to the 
senior officer of the swap data repository; 
‘‘(B) review the compliance of the swap 
data repository with respect to the core prin-
ciples described in subsection (f); 
‘‘(C) in consultation with the board of the 
swap data repository, a body performing a func-
tion similar to the board of the swap data repos-
itory, or the senior officer of the swap data re-
pository, resolve any conflicts of interest that 
may arise; 
‘‘(D) be responsible for administering each 
policy and procedure that is required to be estab-
lished pursuant to this section; 
‘‘(E) ensure compliance with this Act (in-
cluding regulations) relating to agreements, con-
tracts, or transactions, including each rule pre-
scribed by the Commission under this section;
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† HR 4173 EAS 
‘‘(F) establish procedures for the remedi-
ation of noncompliance issues identified by the 
chief compliance officer through any— 
‘‘(i) compliance office review; 
‘‘(ii) look-back; 
‘‘(iii) internal or external audit find-
ing; 
‘‘(iv) self-reported error; or 
‘‘(v) validated complaint; and 
‘‘(G) establish and follow appropriate proce-
dures for the handling, management response, re-
mediation, retesting, and closing of noncompli-
ance issues. 
‘‘(3) ANNUAL REPORTS.— 
‘‘(A) IN
GENERAL.—In accordance with 
rules prescribed by the Commission, the chief 
compliance officer shall annually prepare and 
sign a report that contains a description of— 
‘‘(i) the compliance of the swap data 
repository of the chief compliance officer 
with respect to this Act (including regula-
tions); and 
‘‘(ii) each policy and procedure of the 
swap data repository of the chief compli-
ance officer (including the code of ethics and
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† HR 4173 EAS 
conflict of interest policies of the swap data 
repository). 
‘‘(B) REQUIREMENTS.—A compliance re-
port under subparagraph (A) shall— 
‘‘(i) accompany each appropriate fi-
nancial report of the swap data repository 
that is required to be furnished to the Com-
mission pursuant to this section; and 
‘‘(ii) include a certification that, under 
penalty of law, the compliance report is ac-
curate and complete. 
‘‘(f) CORE PRINCIPLES APPLICABLE TO SWAP DATA 
REPOSITORIES.— 
‘‘(1) ANTITRUST CONSIDERATIONS.—Unless nec-
essary or appropriate to achieve the purposes of this 
Act, a swap data repository shall not 
‘‘(A) adopt any rule or take any action that 
results in any unreasonable restraint of trade; or 
‘‘(B) impose any material anticompetitive 
burden on the trading, clearing, or reporting of 
transactions. 
‘‘(2) GOVERNANCE ARRANGEMENTS.—Each swap 
data repository shall establish governance arrange-
ments that are transparent—
627 
† HR 4173 EAS 
‘‘(A) to fulfill public interest requirements; 
and 
‘‘(B) to support the objectives of the Federal 
Government, owners, and participants. 
‘‘(3) CONFLICTS OF INTEREST.—Each swap data 
repository shall— 
‘‘(A) establish and enforce rules to minimize 
conflicts of interest in the decision-making proc-
ess of the swap data repository; and 
‘‘(B) establish a process for resolving con-
flicts of interest described in subparagraph (A). 
‘‘(g) REQUIRED REGISTRATION FOR SWAP DATA RE-
POSITORIES.—Any person that is required to be registered 
as a swap data repository under this section shall register 
with the Commission regardless of whether that person is 
also licensed as a bank or registered with the Securities and 
Exchange Commission as a swap data repository. 
‘‘(h) RULES.—The Commission shall adopt rules gov-
erning persons that are registered under this section.’’. 
SEC. 729. REPORTING AND RECORDKEEPING. 
The Commodity Exchange Act is amended by inserting 
after section 4q (7 U.S.C. 6o–1) the following:
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† HR 4173 EAS 
‘‘SEC. 
4r. 
REPORTING 
AND 
RECORDKEEPING 
FOR 
UNCLEARED SWAPS. 
‘‘(a) REQUIRED REPORTING OF SWAPS NOT ACCEPT-
ED BY ANY DERIVATIVES CLEARING ORGANIZATION.— 
‘‘(1) IN GENERAL.—Each swap that is not ac-
cepted for clearing by any derivatives clearing orga-
nization shall be reported to— 
‘‘(A) a swap data repository described in 
section 21; or 
‘‘(B) in the case in which there is no swap 
data repository that would accept the swap, to 
the Commission pursuant to this section within 
such time period as the Commission may by rule 
or regulation prescribe. 
‘‘(2) TRANSITION
RULE
FOR
PREENACTMENT 
SWAPS.— 
‘‘(A) SWAPS ENTERED INTO BEFORE THE 
DATE
OF
ENACTMENT
OF
THE
WALL
STREET 
TRANSPARENCY
AND
ACCOUNTABILITY
ACT
OF 
2010.—Each swap entered into before the date of 
enactment of the Wall Street Transparency and 
Accountability Act of 2010, the terms of which 
have not expired as of the date of enactment of 
that Act, shall be reported to a registered swap 
data repository or the Commission by a date 
that is not later than—
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‘‘(i) 30 days after issuance of the in-
terim final rule; or 
‘‘(ii) such other period as the Commis-
sion determines to be appropriate. 
‘‘(B) COMMISSION RULEMAKING.—The Com-
mission shall promulgate an interim final rule 
within 90 days of the date of enactment of this 
section providing for the reporting of each swap 
entered into before the date of enactment as ref-
erenced in subparagraph (A). 
‘‘(C) EFFECTIVE DATE.—The reporting pro-
visions described in this section shall be effective 
upon the enactment of this section. 
‘‘(3) REPORTING OBLIGATIONS.— 
‘‘(A) 
SWAPS
IN
WHICH
ONLY
COUNTERPARTY IS A SWAP DEALER OR MAJOR 
SWAP PARTICIPANT.—With respect to a swap in 
which only 1 counterparty is a swap dealer or 
major swap participant, the swap dealer or 
major swap participant shall report the swap as 
required under paragraphs (1) and (2). 
‘‘(B) SWAPS IN WHICH 1 COUNTERPARTY IS 
A SWAP DEALER AND THE OTHER A MAJOR SWAP 
PARTICIPANT.—With respect to a swap in which 
1 counterparty is a swap dealer and the other a
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major swap participant, the swap dealer shall 
report the swap as required under paragraphs 
(1) and (2). 
‘‘(C) OTHER SWAPS.—With respect to any 
other swap not described in subparagraph (A) or 
(B), the counterparties to the swap shall select a 
counterparty to report the swap as required 
under paragraphs (1) and (2). 
‘‘(b) DUTIES OF CERTAIN INDIVIDUALS.—Any indi-
vidual or entity that enters into a swap shall meet each 
requirement described in subsection (c) if the individual or 
entity did not— 
‘‘(1) clear the swap in accordance with section 
2(h)(1); or 
‘‘(2) have the data regarding the swap accepted 
by a swap data repository in accordance with rules 
(including timeframes) adopted by the Commission 
under section 21. 
‘‘(c) REQUIREMENTS.—An individual or entity de-
scribed in subsection (b) shall— 
‘‘(1) upon written request from the Commission, 
provide reports regarding the swaps held by the indi-
vidual or entity to the Commission in such form and 
in such manner as the Commission may request; and
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‘‘(2) maintain books and records pertaining to 
the swaps held by the individual or entity in such 
form, in such manner, and for such period as the 
Commission may require, which shall be open to in-
spection by— 
‘‘(A) any representative of the Commission; 
‘‘(B) an appropriate prudential regulator; 
‘‘(C) the Securities and Exchange Commis-
sion; 
‘‘(D) the Financial Stability Oversight 
Council; and 
‘‘(E) the Department of Justice. 
‘‘(d) IDENTICAL DATA.—In prescribing rules under 
this section, the Commission shall require individuals and 
entities described in subsection (b) to submit to the Commis-
sion a report that contains data that is not less comprehen-
sive than the data required to be collected by swap data 
repositories under section 21.’’. 
SEC. 730. LARGE SWAP TRADER REPORTING. 
The Commodity Exchange Act (7 U.S.C. 1 et seq.) is 
amended by adding after section 4s (as added by section 
731) the following: 
‘‘SEC. 4t. LARGE SWAP TRADER REPORTING. 
‘‘(a) PROHIBITION.—
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‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), it shall be unlawful for any person to enter 
into any swap that the Commission determines to 
perform a significant price discovery function with 
respect to registered entities if— 
‘‘(A) the person directly or indirectly enters 
into the swap during any 1 day in an amount 
equal to or in excess of such amount as shall be 
established periodically by the Commission; and 
‘‘(B) the person directly or indirectly has or 
obtains a position in the swap equal to or in ex-
cess of such amount as shall be established peri-
odically by the Commission. 
‘‘(2) EXCEPTION.—Paragraph (1) shall not 
apply if— 
‘‘(A) the person files or causes to be filed 
with the properly designated officer of the Com-
mission such reports regarding any transactions 
or positions described in subparagraphs (A) and 
(B) of paragraph (1) as the Commission may re-
quire by rule or regulation; and 
‘‘(B) in accordance with the rules and regu-
lations of the Commission, the person keeps books 
and records of all such swaps and any trans-
actions and positions in any related commodity
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traded on or subject to the rules of any board of 
trade, and of cash or spot transactions in, inven-
tories of, and purchase and sale commitments of, 
such a commodity. 
‘‘(b) REQUIREMENTS.— 
‘‘(1) IN GENERAL.—Books and records described 
in subsection (a)(2)(B) shall— 
‘‘(A) show such complete details concerning 
all transactions and positions as the Commission 
may prescribe by rule or regulation; 
‘‘(B) be open at all times to inspection and 
examination by any representative of the Com-
mission; and 
‘‘(C) be open at all times to inspection and 
examination by the Securities and Exchange 
Commission, to the extent such books and records 
relate to transactions in security-based swap 
agreements (as that term is defined in section 
3(a)(79) of the Securities Exchange Act of 1934), 
and consistent with the confidentiality and dis-
closure requirements of section 8. 
‘‘(2) JURISDICTION.—Nothing in paragraph (1) 
shall affect the exclusive jurisdiction of the Commis-
sion to prescribe recordkeeping and reporting require-
ments for large swap traders under this section.