To be clear on OTC regulation
The US House of Representatives passed a bill on December 11 requiring all standardised derivatives contracts traded between dealers and major swap participants to clear through a registered clearing organisation. The Senate is preparing to debate its version of the rules. Will the final bill mirror the House’s treatment of end-users and keep the forex exemption? By Matt Cameron
A US humorist once quipped: “Ancient Rome declined because it had a Senate. Now what’s going to happen to us with both a House and a Senate?” The derivatives industry will be asking the same question as the US Senate prepares to follow the House of Representatives and pass its own version of over-the-counter derivatives legislation.
The crucial questions are about scope – specifically, whether derivatives end-users and foreign exchange swaps and forwards will be exempt from requirements on
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