The U.S. Securities and Exchange Commission (SEC) is proposing to bring over-the-counter swap markets under greater oversight as part of he effort to ramp up regulation of OTC derivatives markets.
The SEC voted unanimously Wednesday to propose capital, margin, and segregation requirements for security-based swap dealers and major security-based swap participants. The proposed rules are required by the US regulatory reform known as Dodd-Frank, which authorizes the SEC and other regulators to put in place a comprehensive framework for regulating the OTC swaps markets.
The reforms call on the SEC to impose margin and capital requirements to help ensure the safety and soundness of swap dealers and major market participants, and segregation rules that are intended to facilitate the prompt return of customer property if a dealer fails.
“The SEC has now proposed — and in some cases adopted — substantially all of the rules that create the new regulatory regime for derivatives within our jurisdiction,” said SEC chairman, Mary Schapiro. “These rules are intended to make the financial system safer and the derivative markets fairer, more efficient, and more transparent.”
The SEC is seeking public comment on the proposed rules for 60 days.