The CFTC requested public comment on the swap data recordkeeping and reporting requirements under CFTC Rules Part 45 and related provisions. Part 45 requires reporting counterparties and entities to submit swap transaction data to swap data repositories via electronic reporting to enable the CFTC to perform a range of market integrity, risk monitoring and other supervisory functions.
The request for comment, which was developed by the newly created CFTC Interdivisional Working Group, seeks public input on approximately 70 questions addressing topics such as:
- the reporting of primary economic terms, confirmation and continuation data;
- the manner in which the reporting rules address different transaction types, business models and data flows present in swaps markets;
- the reporting of cleared swaps; and
- data harmonization.
Regarding the request for comment, Commissioner Scott O’Malia urged market participants “to carefully review the Commission’s requests, submit their comments, and alert the Commission to other data reporting issues that have not been included,” stating that the comment period is a critical step in the CFTC’s effort to improve data utilization.
The comment period will be open for 60 days from the date of publication of the request for comment in the Federal Register.
Lofchie Comment: This request for comment, which will undoubtedly be followed by changes to the Part 45 Rules, is only one step in what will likely be a decade-long process of cleaning up the rules. It is a credit to acting Chairman Wetjen for undertaking this long term effort and to Commissioner O’Malia, who persisted on the revisitation of the Part 45 Rules.
It is to be hoped that the process of revisiting the Rules begins with questions not for the market, but rather for the CFTC: (i) What information does the CFTC hope to obtain; (ii) what does the CFTC believe it will be able to accomplish with that information; and most importantly, (iii) does the CFTC actually have the technology to receive, retain and analyze whatever information it requires?
See: CFTC Press Release; Commissioner O’Malia’s Statement.
Related news: CFTC Announces Formation of Interdivisional Working Group to Review Regulatory Reporting (January 22, 2014).