The US Government shutdown, combined with industry pressure, leads the CFTC to be more flexible with SEFs.
After previously giving SEFs a month extension to November 1 before a lot of the SEF rules kick in, the CFTC has now granted the SEFs an additional month (to November 29) before certain of their enforcement responsibilities with respect to participants in their markets kicks in, and before they have to start reporting data about certain types of swaps.
The partial delay will give the SEFs and their clients more time to become familiarized with the new rules, while still trading swaps via the SEFs.
Among the SEF licenses granted include Thomson Reuters, 360T, trueEX, BGC Partners, State Street, and Tradeweb.
SEFs have been introduced by US financial regulators as a response to the derivatives-driven market collapse of 2008, which led to the unraveling or even (near or total) collapse of financial stalwarts such as Bear Stearns, Lehman Brother, AIG, and RBS, among others. SEFs are aimed at forcing complex derivatives called swaps into open trading venues. Electronic trading platforms that want to trade swaps have were to have started complying with new rules on October 2.
To see the CFTC press release on the one month extension click here.
Forex Industry Report