WASHINGTON, D.C. – U.S. Senator Pat Roberts, R-Kan., Chairman of the Senate Committee on Agriculture, Nutrition, and Forestry, today released the following statement after U.S. Commodity Futures Trading Commission (CFTC) Chairman Chris Giancarlo’s announcement to extend the $8 billion de minimis threshold phase-in termination date by one year to December 2019. This extension gives the CFTC time to complete the rule in 2018.
“I’m pleased Chairman Giancarlo has hit the ground running at the CFTC and has delayed the swap dealer de minimis threshold to give the CFTC time to get the rule right,” said Chairman Roberts. “If the CFTC had not acted, it would be to the detriment of many community banks and agricultural co-ops and would remove market liquidity from agriculture and energy markets.”
The Dodd-Frank law required the CFTC to establish an appropriate amount of swap dealing activity by an individual entity, which requires them to register as a swap dealer. Swap dealers are subject to extensive recordkeeping, reporting, and regulatory capital and margin requirements. Such requirements are costly, and not something intended to apply to community banks or a commodity end-user, such as a farmer cooperative.