Next week the CFTC will issue guidance on how to make it easier for international regulators to share swaps data and examine global risks.
Commissioner Scott O’Malia said that the guidance is expected to become available as early as Monday. It will exempt foreign regulators from signing indemnification agreements in exchange to U.S. swap data repository data. The entities are exempt so long as foreign regulators structure their own swap reporting procedures.
Foreign regulators and some lawmakers have criticized the indemnification agreements, which make foreign regulators responsible for costs arising from lawsuits over shared data, as an obstacle to monitoring counterparty risk. Overseas regulators claim that measures that discourage the international exchange of swaps data could result in overlapping data collection.
Ethiopis Tafara, the SEC’s director at the Office of Internaitonal Affairs, said that the indemnification agreements may not be a provision of the SEC authority. “The indemnification requirement interferes with access to essential information, including information about the cross-border OTC derivatives markets.”
A bipartisan bill to repeal the provision passed out of Committee in march, but is not on a fast track to passage. The CFTC did not take a position on the bill to repeal.
Read more about the provision.