U.S. regulator issues reprieve from global swaps trading rules

WASHINGTON Wed Feb 12, 2014 12:46pm EST

WASHINGTON Feb 12 (Reuters) - U.S. derivatives regulators said on Wednesday they would relieve U.S. banks from having to comply with some swaps rules for trades executed on overseas platforms, in a move designed to ease ongoing tensions with European regulators.

Commodity Futures Trading Commission Acting Chairman Mark Wetjen announced the plan in a call with reporters, saying the CFTC and the European Union had made "significant progress" in harmonizing cross-border swaps rules.

The Dodd-Frank Wall Street reform law of 2010 imposed sweeping new regulations on the over-the-counter derivatives market.

It requires swap dealers to set aside capital and margin, and it also moves many trade onto regulated platforms known as "swap execution facilities" or SEFs in an effort to help firms get better, more transparent prices.

Wetjen said the CFTC's relief will mean that European-regulated trading platforms will not need to register with U.S. regulators.

In addition, U.S. banks that conduct trades on these overseas platforms will also not have to face certain U.S. rules.

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