CFTC Approves Technical Corrections to Swap Dealer Regulations

The U.S. Commodity Futures Trading Commission (CFTC) has published a press statement to announce upcoming changes to Statutory Instrument 17 CFR Part 23 which is the key legislation governing swap dealers (SDs) and major swap counterparties (MSPs) as regards registration, capital and margin, reporting, and recordkeeping requirements, to name a few. The modifications, so the CFTC, are technical, non-substantive in nature and include the following:
1. the update of legal references;
2. the replacement of the term unique swap identifier (USI) with the term unique transaction identifier (UTI);
3. the specification of the term counterparty identifier as Legal Entity Identifier (LEI) to ensure that SDs and MSPs always provide in their reports the LEI (or an adequate alternative);
4. the update and clarification of the term Unique Product Identifier (UPI) to ensure the UPI is ALWAYS used in swap trade records; and
5. the update of an example of floating rate swaps for reporting purposes (set out in Appendix 1 of Subpart I) to no longer reference a LIBOR swap, but instead use a swap with the „FED Funds“ rate as a benchmark.
The modifications are necessary to align CFTC Rule 23 with previous amendments to CFTC Rule 45 as regards swap data recordkeeping and reporting requirements for swap data repositories, derivatives clearing organizations, swap execution facilities, and several others.