De Minimis Threshold

On October 26, 2017, the Commodity Futures Trading Commission (“CFTC”) issued an order postponing the automatic lowering of the swap dealer de minimis threshold. Instead of dropping from $8 billion in notional value (measured over the prior 12-month period) to $3 billion on December 31, 2018, which would have required firms to begin tracking swap activity on January 1, 2018, the threshold will drop on December 31, 2019, unless the CFTC determines to change the threshold prior to this date. Thus, firms will not have to start tracking swap activity for the $3 billion threshold until January 1, 2019; firms will, of course, need to track for the $8 billion threshold. Chairman Giancarlo forecast this delay in his appearance before the House Committee on Agriculture on October 11, 2017, testifying that he would seek the delay because he wanted “to get the right result, not a rushed result,” and noting that recent turnover in the Commission made it difficult to implement “such an important decision in a rush.” However, Chairman Giancarlo indicated that no further delays were expected, and that the CFTC would establish a de minimis threshold in the first half of 2018.

Continue Reading CFTC Further Delays Swap Dealer De Minimis Threshold Drop

On October 13, 2016, the Commodity Futures Trading Commission (CFTC) issued an order postponing until December 31, 2018, the lowering of the swap dealer de minimis threshold to $3 billion.  The Dodd-Frank Act provided that, absent action by the CFTC, the swap dealer de minimis threshold — the gross notional amount of swap dealing activity a firm could engage in before the firm is considered a “swap dealer” — would automatically drop from $8 billion to $3 billion on December 31, 2017.  Firms would also have been required to start tracking their swap activity on January 1, 2017 to determine their level of swap dealing activity, but the CFTC’s order means that firms do not have to begin tracking their swap activity until January 1, 2018.

Continue Reading CFTC Issues Order Postponing Swap Dealer De Minimis Threshold Drop