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The OIA advises the Commission regarding interna­tional regulatory initiatives; provides guidance regarding international issues raised in Commission matters; represents the Commission in interna­tional organizations, such as the International Organization of Securities Commissions (IOSCO); coordinates Commission policy as it relates to policies and initiatives of major foreign jurisdictions, the G20, Financial Stability Board and the U.S. Treasury Department; and provides technical assistance to foreign market authorities.

The Commission’s international policy coordination activities take place primarily within IOSCO and within U.S. Treasury and G-20 working groups.   The aftermath of the financial crisis has prompted the formation of numerous initiatives in all of these forums, such as: cooperation and coordination in the areas of swaps regulation, central counterparty clearing standards, the monitoring and control of systemic risk, the protection of customer funds, and mechanisms to share systemically important information internationally.  International concerns regarding volatility in commodity futures markets resulted in the formation of an IOSCO Task Force on Commodity Futures Markets, which is co-chaired by the Commission’s international staff.  Participation in these work-streams is critical because the work-product is often transformed into international standards of best practice, which are then subject to compliance assessment by the International Monetary Fund in its Financial Sector Assessment program.  The Commission’s participation historically has focused on incorporating the Commission’s (and hence, the U.S.’s) regulatory approach into these internationals standards, encouraging international harmonization.

The Commission’s international agenda also includes responding to requests by the U.S. Treasury to participate in international dialogues (e.g., U.S.— China dialogue), participating in National Security Council organized discussions to coordinate U.S. Government commodity policy, providing technical assistance to developing market jurisdictions, and engaging in bilateral negotiations with foreign regulators to resolve cross-border issues that affect the competitiveness of the U.S. futures industry.    The Commission’s current work is supported by 10 FTE.

The adoption of DFA legislation and the ongoing development of implementing rules by the Commission have significantly increased demands on international staffing.  For example, the Commission’s international staff has engaged in an unprecedented outreach to European regulatory authorities, most notably the European Commission.   This effort has focused on encouraging foreign regulatory authorities to adopt rules that are harmonized with the Commission’s DFA approach.   International staff also is participating in cooperation with the SEC in the DFA mandated study on the approaches to over-the-counter derivatives swap regulation and the regulation of over-the-counter clearing in major jurisdictions.

Once the new DFA regulations are in effect, international staff will be required to develop supervisory coordination arrangements with foreign authorities in major jurisdictions where regulated entities will reside, such as the European Union, Canada, and Japan.   Focusing solely on the EU, the Commission contemplate the need to engage not only the European Commission, but also the European Securities and Markets Authority and relevant national regulators, such as the U.K. FSA, French AMF and German BAFIN, to negotiate coordinating supervisory arrangements for entities that likely will be subject to regulation in both the EU and the United States.  Likewise, the Commission anticipates that similar arrangement will be needed in major market jurisdictions such as Australia, Canada and Japan. 

Finally, IOSCO recently converted the Task Force on Commodity Futures Markets into a permanent standing committee, which will require stable, long-term staffing if the Commission is to retain its leadership role as co-chair of that standing committee.  

In order to adequately staff the existing work-streams and accommodate the growing demands of DFA rules, the Commission requests six additional FTE.

Coordinated Dodd-Frank Outreach.  Coordinated staff and Chairman's engagement with the European Commission and European Parliament with the objective of encouraging harmonization of European regulatory development with Dodd-Frank policies.  Initiated similar discussions with other foreign regulators. 

Created International Working Groups.  The CFTC began technical level working groups on over-the-counter derivatives with the European Commission and European Securities Markets Authority, and regulatory authorities in Japan, Singapore, and Hong Kong.  Additionally, the Office of International Affairs organized a joint CFTC-SEC roundtable on the cross-border application of Dodd-Frank. 

Participated in Internal Dodd-Frank Policy Development.  Coordinated a review of cross-border arrangements that will be needed under Dodd-Frank and developed draft memorandum of understanding on the supervision of dually-regulated cross-border clearinghouses.   Participated in rule development where there were international implications.

Led Development of Principles for Commodity Market Supervision. Led the effort within the IOSCO Task Force on Commodity Futures Markets to develop a final report on "Principles for the Regulation and Supervision of Commodity Derivatives Markets," as requested by IOSCO and the G-20.  IOSCO determined to convert the task force into a permanent standing committee.

Coordinated IOSCO Policy Work. Coordinated Commission policy within the IOSCO Technical Committee and Standing Committee 2 on secondary markets, Standing Committee 3 on intermediaries, the over-the-counter derivatives task force, and the task force on implementation of the IOSCO Principles, which revised the IOSCO Methodology.

Coordinated Financial Policy within U.S. Treasury-led Initiatives.  Represented the Commission in U.S. treasury strategic and economic dialogues such as with China and India, the North American Free Trade Agreement, and with the European Commission.  Participated in G-20 study groups on commodities and on fossil fuel volatility and coordinated policy with the National Security Council on agricultural commodity volatility. 

Planned Technical Assistance Efforts.  Planned the annual international regulatory conference at Boca Raton, Florida and the annual symposium for foreign regulators in Chicago.  Coordinated staff technical assistance mission to Ethiopia and a secondment program for the Korean Financial Supervisory Service.

Outreach to Harmonize International OTC polices.  OIA will continue to work with staff at the European Commission, in order to encourage harmonization of European Union law to the level of the Commission's Dodd-Frank rulemakings, to resolve policy differences, and avoid gaps that could lead to regulatory arbitrage.  OIA will continue to coordinate meetings between the Chairman and European Commission and European Union authorities.  OIA will engage with other foreign regulators (e.g., Canada, Japan, and Singapore) for similar purposes.

Coordinate Supervision of Global Entities with Foreign Authorities.  Work with foreign authorities, including  the European Commission,  European Securities Market Authority, and other foreign regulators to coordinate policies and to develop memorandum of understanding and other cooperative arrangements that will be needed to implement final Commission Dodd-Frank rules (e.g.,  with regard to swap data repositories).

Develop Internal Policy on the International Application of the Dodd-Frank Act.  Work with an internal team to determine when and how to apply the Dodd-Frank Act to "activities that have a direct and significant effect" on U.S. Commerce pursuant to Section 722(d) of the Dodd-Frank Act. 

IOSCO Representation.  Continue to participate in IOSCO's Technical Committee, and co-chair the newly created standing committee on commodity futures markets. OIA will continue to participate in IOSCO standing committee 2 on secondary markets, 3 on intermediaries, the implementation task force and over-the-counter derivatives task force.  All of these activities relate collectively to the development of standards of best practices and guidance in securities and derivatives regulation.

Respond to Global Concerns About Volatility in Energy and Agricultural Futures Markets.  Participate in U.S. Treasury and National Security Commission coordinating groups, various G20 energy and commodity experts groups and co-chair the IOSCO standing committee on commodity futures markets, to address volatility in energy and agricultural commodity futures markets and develop supervisory standards for commodity futures markets.

U.S. Treasury and other Initiatives.  Coordinate CFTC participation in U.S. Treasury financial dialogues, financial stability Board projects and other multilateral initiatives (e.g., within the North American Free Trade Agreement and the International Monetary Fund).

Technical Assistance.  OIA will continue to plan and coordinate: The Commission's annual trading seminar for foreign market authorities; the Commission's annual hosting of an international conference for foreign regulators in Boca Raton, Florida;  visits to the Commission requested  by foreign regulators to the Commission; and on-site technical assistance to foreign market authorities, on a staff-available basis.

Outreach to Harmonize International Over-the-Counter polices.  OIA will continue to work with staff at the European Commission, in order to encourage harmonization of European Commission law to the level of the Commission's Dodd-Frank rulemakings, to resolve policy differences, and avoid gaps that could lead to regulatory arbitrage.  OIA will continue to coordinate meetings between the Chairman and European Commission authorities.  OIA will engage with other foreign regulators (e.g., Canada, Japan, and Singapore) for similar purposes. 

Coordinate Supervision of Global Entities with Foreign Authorities.  Work with foreign authorities, including  the European Commission,  European Securities Market Authority, and other foreign regulators to coordinate policies and to develop memorandum of understanding and other cooperative arrangements that will be needed to implement final Commission Dodd-Frank rules (e.g.,  with regard to swap data repositories).

Develop Internal Policy on the International Application of the Dodd-Frank Act.  Work with an internal team to determine when and how to apply the Dodd-Frank Act to "activities that have a direct and significant effect" on U.S. Commerce pursuant to Section 722(d) of the Dodd-Frank Act. 

IOSCO Representation.  Continue to participate in IOSCO's Technical Committee, and co-chair the newly created standing committee on commodity futures markets. OIA will continue to participate in IOSCO standing committee 2 on secondary markets, 3 on intermediaries, the implementation task force and over-the-counter derivatives task force.  All of these activities relate collectively to the development of standards of best practices and guidance in securities and derivatives regulation.

Respond to Global Concerns About Volatility in Energy and Agricultural Futures Markets.  Participate in U.S. Treasury and NSC coordinating groups, various G20 energy and commodity experts groups and co-chair the IOSCO standing committee on commodity futures markets, to address volatility in energy and agricultural commodity futures markets and develop supervisory standards for commodity futures markets.

U.S. Treasury and other initiatives.  Coordinate CFTC participation in U.S. Treasury financial dialogues, financial stability Board projects and other multilateral initiatives, such as the North American Free Trade Agreement and International Monetary Fund.

Technical Assistance.  OIA will continue to plan and coordinate: The Commission's annual trading seminar for foreign market authorities; the Commission's annual hosting of an international conference for foreign regulators in Boca Raton, Florida;  visits to the Commission requested  by foreign regulators to the Commission; and on-site technical assistance to foreign market authorities, on a staff-available basis.

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