“Reasonable”

Statement of CFTC Commissioner Bart Chilton

September 27, 2013

Wednesday, October 2 is an important day. It is the day that the Part 37 Swaps Execution Facility (SEF) Rules are effective, and that Commission Regulations Parts 43 and 45 reporting rules for SEFs reporting transaction data to swaps data repositories (SDRs) go into effect. SEFs are to be ready to “go live,” and have numerous required legal and technological documentation in place with SDRs, derivatives clearing organizations, and customers.

That’s all well and good, and I’m gratified that we’re moving ahead to shine needed light onto the dark markets that led us to a financial crisis in 2008. I have been an aggressive advocate for getting implementation of all Dodd-Frank rules done as promptly as possible. At the same time, when compliance with our rules is technologically or otherwise simply impracticable, I have been consistent in maintaining that the CFTC can and should provide targeted, time-limited relief as appropriate. I do so today. I appreciate that our Chairman has acknowledged the need for relief. It is imperative, however, that such relief not be delayed. It needs to happen today.

With regard specifically to the reporting issues raised by footnote 88 in the Commission’s SEF rule (pulling “permitted transactions” into SEF procedures), and to “onboarding” issues, I believe that we need to provide an extension for two months. As to the reporting relief, I believe it should not be limited to any certain class or type of swap category for this limited time period. This is an aggressive, but reasonable timetable for compliance.

We have heard from many quarters that, absent providing some relief, we are at risk of causing serious market disruptions and possible serious liquidity crises. At this particular time, given the possibility of a federal government shut-down, it is simply not reasonable to turn a deaf ear to these requests. Let’s be reasonable.

Last Updated: September 27, 2013