[Federal Register Volume 80, Number 168 (Monday, August 31, 2015)]
[Proposed Rules]
[Pages 52544-52586]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-21030]



[[Page 52543]]

Vol. 80

Monday,

No. 168

August 31, 2015

Part II





Commodity Futures Trading Commission





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17 CFR Part 45





Amendments to Swap Data Recordkeeping and Reporting Requirements for 
Cleared Swaps; Proposed Rule

  Federal Register / Vol. 80 , No. 168 / Monday, August 31, 2015 / 
Proposed Rules  

[[Page 52544]]


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COMMODITY FUTURES TRADING COMMISSION

17 CFR Part 45

RIN 3038-AE12


Amendments to Swap Data Recordkeeping and Reporting Requirements 
for Cleared Swaps

AGENCY: Commodity Futures Trading Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Commodity Futures Trading Commission (``Commission'' or 
``CFTC'') is proposing amendments to rules relating to swap data 
reporting in connection with cleared swaps for swap data repositories 
(``SDRs''), derivatives clearing organizations (``DCOs''), designated 
contract markets (``DCMs''), swap execution facilities (``SEFs''), swap 
dealers (``SDs''), major swap participants (``MSPs''), and swap 
counterparties who are neither SDs nor MSPs. Commodity Exchange Act 
(``CEA'' or ``Act'') provisions relating to swap data recordkeeping and 
reporting were added by the Dodd-Frank Wall Street Reform and Consumer 
Protection Act (``Dodd-Frank Act''). The proposed amendments to the 
rules further the goals of the Dodd-Frank Act to reduce systemic risk, 
increase transparency and promote market integrity within the financial 
system.

DATES: Comments must be received on or before October 30, 2015.

ADDRESSES: You may submit comments, identified by ``Amendments to Swap 
Data Recordkeeping and Reporting Requirements for Cleared Swaps'' and 
RIN 3038-AE12, by any of the following methods:
     CFTC Web site: http://comments.cftc.gov. Follow the 
instructions for submitting comments through the Comments Online 
process on the Web site.
     Mail: Send to Christopher Kirkpatrick, Secretary of the 
Commission, Commodity Futures Trading Commission, Three Lafayette 
Centre, 1155 21st Street NW., Washington, DC 20581.
     Hand Delivery/Courier: Same as Mail, above.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
    Please submit your comments using only one of these methods.
    All comments must be submitted in English, or if not, accompanied 
by an English translation. Comments will be posted as received to 
www.cftc.gov. You should submit only information that you wish to make 
available publicly. If you wish the Commission to consider information 
that you believe is exempt from disclosure under the Freedom of 
Information Act, a petition for confidential treatment of the exempt 
information may be submitted according to the procedures established in 
Sec.  145.9 of the Commission's regulations.\1\
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    \1\ 17 CFR 145.9.
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    The Commission reserves the right, but shall have no obligation, to 
review, pre-screen, filter, redact, refuse or remove any or all of your 
submission from www.cftc.gov that it may deem to be inappropriate for 
publication, such as obscene language. All submissions that have been 
redacted or removed that contain comments on the merits of the 
rulemaking will be retained in the public comment file and will be 
considered as required under the Administrative Procedure Act and other 
applicable laws, and may be accessible under the Freedom of Information 
Act.

FOR FURTHER INFORMATION CONTACT: Dan Bucsa, Deputy Director, Division 
of Market Oversight, 202-418-5435, [email protected]; Aaron Brodsky, 
Special Counsel, Division of Market Oversight, 202-418-5349, 
[email protected]; Ben DeMaria, Special Counsel, Division of Market 
Oversight, 202-418-5988, [email protected]; Esen Onur, Economist, 
Office of the Chief Economist, 202-418-6146, [email protected]; or Mike 
Penick, Economist, Office of the Chief Economist, 202-418-5279, 
[email protected]; Commodity Futures Trading Commission, Three Lafayette 
Centre, 1151 21st Street NW., Washington, DC 20581.

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Background
    A. Introduction
    B. Statutory Authority
    C. Regulatory History--Part 45 Final Rulemaking
    D. Consultation With Other U.S. Financial Regulators
    E. Summary of Proposed Revisions to Part 45
II. Proposed Regulations
    A. Definitions--Proposed Amendments to Sec.  45.1
    B. Swap Data Reporting: Creation Data--Proposed Amendments to 
Sec.  45.3
    C. Swap Data Reporting: Continuation Data--Proposed Amendments 
to Sec.  45.4
    D. Unique Swap Identifiers--Proposed Amendments to Sec.  45.5
    E. Determination of Which Counterparty Must Report--Proposed 
Amendments to Sec.  45.8
    F. Reporting to a Single Swap Data Repository--Proposed 
Amendments to Sec.  45.10
    G. Examples of Cleared Swap Reporting Workflows Under the 
Proposed Revisions
    H. Primary Economic Terms Data--Proposed Amendments to Appendix 
1 to Part 45--Tables of Minimum Primary Economic Terms
III. Request for Comments
IV. Related Matters
    A. Regulatory Flexibility Act
    B. Paperwork Reduction Act
    C. Cost-Benefit Considerations
    D. Antitrust Considerations

I. Background

A. Introduction

    On July 21, 2010, President Obama signed into law the Dodd-Frank 
Act.\2\ Title VII of the Dodd-Frank Act amended the CEA \3\ to 
establish a comprehensive new regulatory framework for swaps and 
security-based swaps. The legislation was enacted to reduce systemic 
risk, increase transparency, and promote market integrity within the 
financial system by, among other things: providing for the registration 
and comprehensive regulation of SDs and MSPs; imposing clearing and 
trade execution requirements on standardized derivative products; 
creating rigorous recordkeeping and data reporting regimes with respect 
to swaps, including real time reporting; and enhancing the Commission's 
rulemaking and enforcement authorities with respect to, among others, 
all registered entities, intermediaries, and swap counterparties 
subject to the Commission's oversight.
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    \2\ See Dodd-Frank Wall Street Reform and Consumer Protection 
Act, Public Law 111-203, 124 Stat. 1376 (2010). The text of the 
Dodd-Frank Act may be accessed at http://www.cftc.gov/LawRegulation/DoddFrankAct/index.htm.
    \3\ 7 U.S.C. 1, et seq.
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B. Statutory Authority

    To enhance transparency, promote standardization, and reduce 
systemic risk, section 727 of the Dodd-Frank Act added to the CEA 
section 2(a)(13)(G), which requires all swaps, whether cleared or 
uncleared, to be reported to SDRs, which are registered entities \4\ 
created by section 728 of the Dodd-Frank Act to collect and maintain 
data related to swap transactions as prescribed by the Commission, and 
to make such data available to the Commission and other regulators.\5\ 
Section 21(b) of the CEA, added by section 728 of the Dodd-Frank Act, 
directs the Commission to prescribe standards for swap data 
recordkeeping

[[Page 52545]]

and reporting, which are to apply to both registered entities and 
counterparties involved with swaps \6\ and which are to be comparable 
to those for clearing organizations in connection with their clearing 
of swaps.\7\
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    \4\ See also CEA sections 1a(40)(E) and 1a(48).
    \5\ Regulations governing core principles and registration 
requirements for, and the duties of, SDRs are the subject of part 49 
of this chapter.
    \6\ CEA section 21(b)(1)(A).
    \7\ CEA section 21(b)(3).
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C. Regulatory History--Part 45 Final Rulemaking

    On December 20, 2011, the Commission adopted part 45 of the 
Commission's regulations (``Final Part 45 Rulemaking'').\8\ Part 45 
implements the requirements of section 21 of the CEA by setting forth 
the manner and contents of reporting to SDRs, and requires electronic 
reporting both when a swap is initially executed, referred to as 
``creation'' data,\9\ and over the course of the swap's existence, 
referred to as ``continuation'' data.\10\ The part 45 regulations set 
forth varying reporting timeframes depending on the type of reporting, 
counterparty, execution, or product.
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    \8\ See ``Swap Data Recordkeeping and Reporting Requirements,'' 
77 FR 2136, Jan. 13, 2012.
    \9\ See 17 CFR 45.1 (defining ``required swap creation data'' as 
``all primary economic terms data for a swap in the swap asset class 
in question, and all confirmation data for the swap.'') ``Primary 
economic terms data'' is defined as ``all of the data elements 
necessary to fully report all of the primary economic terms of a 
swap in the swap asset class of the swap in question,'' while 
``confirmation data'' is defined as ``all of the terms of a swap 
matched and agreed upon by the counterparties in confirming the 
swap. For cleared swaps, confirmation data also includes the 
internal identifiers assigned by the automated systems of the [DCO] 
to the two transactions resulting from novation to the clearing 
house.'' Id. See also 17 CFR 45.3.
    \10\ See 17 CFR 45.1 (defining ``required swap continuation 
data'' as ``all of the data elements that must be reported during 
the existence of a swap to ensure that all data concerning the swap 
in the swap data repository remains current and accurate, and 
includes all changes to the primary economic terms of the swap 
occurring during the existence of the swap. . . . '' See also 17 CFR 
45.4.
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    As part of the Commission's ongoing efforts to improve swap 
transaction data quality and to improve the Commission's ability to 
utilize the data for regulatory purposes, Commission staff has 
continued to evaluate reporting issues relating to the operation of 
part 45, and cleared swaps in particular. Commission staff's efforts 
included the formation of an interdivisional staff working group to 
identify, and make recommendations to resolve, reporting challenges 
associated with certain swaps transaction data recordkeeping and 
reporting provisions, including the provisions adopted in the Final 
Part 45 Rulemaking.\11\
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    \11\ See Press Release, CFTC to Form an Interdivisional Working 
Group to Review Regulatory Reporting, Jan. 21, 2014, available at 
http://www.cftc.gov/PressRoom/PressReleases/pr6837-14.
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    Based in large part on those efforts, the Commission ultimately 
requested comment on a variety of swap data reporting and recordkeeping 
provisions to help determine how such provisions were being applied and 
to determine whether or what clarifications or enhancements may be 
appropriate.\12\ One of the subjects of the request for comment was the 
reporting of cleared swaps, and, in particular, the manner in which the 
swap data reporting rules should address cleared swaps.\13\ In response 
to this request, the Commission received a number of comment letters 
addressing reporting of cleared swaps.\14\ References to ``commenters'' 
throughout this release refer to those who submitted such comment 
letters, and summaries and a discussion of the general themes raised by 
those commenters appear in the relevant sections throughout this 
release.
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    \12\ See ``Review of Swap Data Recordkeeping and Reporting 
Requirements,'' Request for Comment, 79 FR 16689, Mar. 26, 2014.
    \13\ Id. at 16694.
    \14\ Commenters included: The American Gas Association, May 27, 
2014; American Petroleum Institute, May 27, 2014; Americans for 
Financial Reform, May 27, 2014 (``AFR''); Australian Bankers' 
Association, May 27, 2014 (``ABA''); Better Markets, Inc., May 27, 
2014, (``Better Markets''); B&F Capital Markets, Inc., May 27, 2014; 
CME Group, May 27, 2014 (``CME''); Coalition for Derivatives End-
Users, May 27, 2014 (``CDEU''); Coalition of Physical Energy 
Companies, May 27, 2014; Commercial Energy Working Group, May 27, 
2014 (``CEWG''); Commodity Markets Council, May 27, 2014 (``CMC''); 
The Depository Trust & Clearing Corporation, May 27, 2014 
(``DTCC''); EDF Trading North America, LLC, May 27, 2014; Edison 
Electric Institute, May 27, 2014 (``EEI''); Financial InterGroup 
Holdings Ltd, May 27, 2014; Financial Services Roundtable, May 27, 
2014; Fix Trading Community, May 27, 2014; The Global Foreign 
Exchange Division of the Global Financial Markets Association, May 
27, 2014 (``GFMA''); HSBC, May 27, 2014; Interactive Data 
Corporation, May 27, 2014; Intercontinental Exchange, May 27, 2014 
(``ICE''); International Energy Credit Association, May 27, 2014; 
International Swaps and Derivatives Association, Inc., May 23, 2014 
(``ISDA''); Japanese Bankers Association, May 27, 2014 (``JBA''); 
Just Energy Group Inc., May 27, 2014; LCH.Clearnet Group Limited, 
May 29, 2014 (``LCH''); Managed Funds Association, May 27, 2014 
(``MFA''); Markit, May 27, 2014; Natural Gas Supply Association, May 
27, 2014 (``NGSA''); NFP Electric Associations (National Rural 
Electric Cooperative Association, American Public Power Association, 
and Large Public Power Council), May 27, 2014 (``NFPEA''); OTC 
Clearing Hong Kong Limited, May 27, 2014 (``OTC Hong Kong''); 
Securities Industry and Financial Markets Association Asset 
Management Group, May 27, 2014 (``SIFMA''); SWIFT, May 27, 2014; 
Swiss Re, May 27, 2014; Thomson Reuters (SEF) LLC, May 27, 2014 
(``TR SEF''); and TriOptima, May 27, 2014.
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    The swap data reporting framework adopted in the Final Part 45 
Rulemaking was largely based on the mechanisms for the trading and 
execution of uncleared swaps. Under such a regime, swap data reporting 
was premised upon the existence of one continuous swap for reporting 
and data representation purposes. The Commission has since had 
additional opportunities to consult with industry and to observe how 
the part 45 regulations function in practice with respect to swaps that 
are cleared, including how the implementation of part 45 interacts with 
the implementation of part 39 of the Commission's regulations, which 
contains provisions applicable to DCOs.
    In particular, Sec.  39.12(b)(6) provides that upon acceptance of a 
swap by a DCO for clearing, the original swap is extinguished and 
replaced by equal and opposite swaps, with the DCO as the counterparty 
to each such swap.\15\ The original swap that is extinguished upon 
acceptance for clearing is commonly referred to as the ``alpha'' swap 
and the equal and opposite swaps that replace the original swap are 
commonly referred to as ``beta'' and ``gamma'' swaps. The Commission 
has observed that certain provisions of part 45 could better 
accommodate the cleared swap framework set forth in Sec.  39.12(b)(6). 
The revisions and additions proposed in this release are intended to 
provide clarity to swap counterparties and registered entities of their 
part 45 reporting obligations with respect to the swaps involved in a 
cleared swap transaction. This proposal is also intended to improve the 
efficiency of data collection and maintenance associated with the 
reporting of the swaps involved in a cleared swap transaction.
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    \15\ See 17 CFR 39.12(b)(6) (requiring a DCO that clears swaps 
to ``have rules providing that, upon acceptance of a swap by the 
[DCO] for clearing: (i) The original swap is extinguished; (ii) the 
original swap is replaced by an equal and opposite swap between the 
[DCO] and each clearing member acting as principal for a house 
trading or acting as agent for a customer trade . . .''). The 
Commission reaffirmed its position regarding the composition of a 
cleared swap in a statement regarding Chicago Mercantile Exchange 
(``CME'') Rule 1001. See Statement of the Commission on the Approval 
of CME Rule 1001 at 6, Mar. 6, 2013, available at http://www.cftc.gov/ucm/groups/public/@newsroom/documents/file/statementofthecommission.pdf.
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    Where possible, the Commission has endeavored to harmonize the 
rules proposed in this release with the approach proposed by the 
Securities and Exchange Commission (``SEC'') in its release proposing 
certain new rules and rule amendments to Regulation SBSR--Reporting and 
Dissemination of Security-Based Swap Information (``Regulation 
SBSR'').\16\ The SEC release proposed new rules and rule amendments to 
Regulation SBSR,

[[Page 52546]]

which, in pertinent part, address the reporting to a registered 
security-based swap data repository of security-based swaps that will 
be submitted to clearing. The SEC received a number of comments on its 
release,\17\ and, given the similarities between the reporting 
framework set forth in the proposed new rules and rule amendments to 
Regulation SBSR and the proposed amendments to part 45 that are the 
subject of this release, the Commission also includes in this release 
the following discussion of the general themes raised in the Regulation 
SBSR comment letters: \18\
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    \16\ See ``Regulation SBSR--Reporting and Dissemination of 
Security-Based Swap Information,'' 80 FR 14740, Mar. 19, 2015.
    \17\ The comment file is available at http://www.sec.gov/comments/s7-03-15/s70315.shtml.
    \18\ The discussion of comments received by the SEC on its 
release proposing new rules and rule amendments to Regulation SBSR 
reflects the Commission's understanding of the comment letters and 
do not necessarily reflect the views of the SEC. Comments received 
by the SEC in response to its release proposing new rules and rule 
amendments to Regulation SBSR are denoted as ``Regulation SBSR 
Comment Letter'' throughout this release.
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    Several commenters expressed concerns that allowing the clearing 
agency to report data to a different security-based SDR (``SB-SDR'') 
\19\ than the SB-SDR to which an initial alpha trade was reported could 
result in bifurcated data, and contended that beta and gamma trades 
should be reported to the same SB-SDR as the alpha trade in order to 
facilitate data aggregation and to allow regulators easy access to all 
of the data for a particular swap transaction.\20\
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    \19\ As summarized in this release, references to SDRs in 
Regulation SBSR Comment Letters in some cases have been replaced 
with ``SB-SDR'' to delineate between the SEC and the Commission SDR 
registration regimes, respectively. Throughout this release, 
references to ``SDR'' refer to SDRs registered with the Commission.
    \20\ See Depository Trust and Clearing Corporation Regulation 
SBSR Comment Letter, May 4, 2015, at 4-6 (advocating for all records 
related to a single alpha trade to be reported to a single SB-SDR 
and suggesting an alternative to the SEC's proposed rules); Better 
Markets, Inc. Regulation SBSR Comment Letter, May 4, 2015, at 2, 4 
(stating that the SEC must ensure it is easy to commingle and use 
data from two different SDRs and enable beta and gamma trades to be 
traced back to the alpha trade, and, if not, that the SEC must 
require the alpha, beta, and gamma trades to all be reported to the 
same SDR); and Markit Regulation SBSR Comment Letter, May 4, 2015, 
at 3, 6.
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    Some commenters expressed support for modifications which would 
assign the sole reporting duty for a clearing transaction \21\ to the 
registered clearing agency, provided that the SEC adopts its proposal 
to assign the clearing agency the sole reporting obligation for 
clearing transactions and that the SEC allows the registered clearing 
agency to select the SB-SDR to which it reports.\22\
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    \21\ SEC Rule 900(g) defines ``clearing transaction'' as ``a 
security-based swap that has a registered clearing agency as a 
direct counterparty.''). See Regulation SBSR--Reporting and 
Dissemination of Security-Based Swap Information,'' 80 FR 14564, 
Mar. 19, 2015.
    \22\ See International Swaps and Derivatives Association, Inc. 
and Securities Industry and Financial Markets Association Regulation 
SBSR Comment Letter, May 4, 2015, at 24 (noting that clearing 
agencies have demonstrated their ability and preference to report 
data for cleared transactions in other jurisdictions globally and 
under the CFTC rules) and ICE Trade Vault, LLC Regulation SBSR 
Comment Letter, May 4, 2015, at 1, 3, 5 (stating that for cleared 
security-based swaps, the clearing agency is the sole party who 
holds the complete and accurate record of transactions and 
positions, and that no other party has complete information about 
the resulting swaps and the subsequent downstream clearing processes 
that affect those swaps).
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    Some commenters agreed with the SEC's proposed addition of a 
requirement that the registered clearing agency report whether it has 
accepted an alpha for clearing to the alpha SB-SDR in the format 
required by such SB-SDR.\23\ Another commenter contended that if the 
reporting side \24\ to the alpha selected the SB-SDR to receive the 
beta and gamma trades, the clearing agency would not have to report to 
the alpha SB-SDR that the security-based swap has been accepted for 
clearing.\25\
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    \23\ See International Swaps and Derivatives Association, Inc. 
and Securities Industry and Financial Markets Association Regulation 
SBSR Comment Letter at 24 (noting that such a requirement would 
prevent the ``orphaning'' of alphas that currently occurs under CFTC 
rules) and ICE Trade Vault, LLC Regulation SBSR Comment Letter at 5 
(noting that the SDR should immediately accept and process the alpha 
termination and that clearing agencies are the sole reporting side 
that can report alpha terminations).
    \24\ The ``reporting side'' under SEC rules is a similar concept 
to the ``reporting counterparty'' under part 45 of the Commission's 
rules.
    \25\ See Markit Regulation SBSR Comment Letter at 15.
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    Some commenters acknowledged the value of the proposal to require 
the party required to report the alpha to provide the clearing agency 
with the transaction ID of the alpha and the identity of the alpha SB-
SDR, noting that the Unique Transaction Identifier has already been 
incorporated into submission flows to clearing agencies for use in 
reporting in other jurisdictions.\26\
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    \26\ See International Swaps and Derivatives Association, Inc. 
and Securities Industry and Financial Markets Association Regulation 
SBSR Comment Letter at 25.
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D. Consultation With Other U.S. Financial Regulators

    In developing these rules, Commission staff has engaged in 
extensive consultations with U.S. domestic financial regulators. The 
agencies and institutions consulted include the SEC, the Federal 
Reserve Board of Governors, the Federal Housing Finance Agency, the 
Federal Deposit Insurance Corporation, Office of Comptroller of the 
Currency, and the Farm Credit Administration.

E. Summary of Proposed Revisions to Part 45

    The Commission is proposing revisions and additions to Sec. Sec.  
45.1, 45.3, 45.4, 45.5, 45.8, 45.10, and appendix 1 to part 45 in order 
to provide clarity to counterparties to a swap and registered entities 
regarding their part 45 reporting obligations with respect to each of 
the swaps involved in a cleared swap transaction.\27\ The Commission 
proposes the following amendments, each of which is discussed in 
greater detail in Section II of this release:
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    \27\ The Commission is also proposing to amend the part 45 
authority citation to replace a reference to 7 U.S.C. 24 with a 
reference to 7 U.S.C. 24a.
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     Amendments to Sec.  45.1 would revise the definition of 
``derivatives clearing organization'' to update a cross-reference and 
to make explicit that the definition covers only registered DCOs. 
Revised Sec.  45.1 would also add new definitions for ``original 
swaps'' and ``clearing swaps.'' These proposed terms would be used 
throughout part 45 to help clarify reporting obligations for the swaps 
involved in a cleared swap transaction.
     Amendments to Sec.  45.3 would: Modify and clarify DCO 
creation data reporting obligations for swaps that result from the 
clearing process; establish which entity has the obligation to choose 
the SDR to which creation data is reported; eliminate confirmation data 
reporting obligations for swaps that are intended to be submitted to a 
DCO for clearing at the time of execution; and make conforming changes.
     Amendments to Sec.  45.4 would modify and clarify 
continuation data reporting obligations for original swaps, including 
the obligation to report original swap terminations to the SDR to which 
the original swap was reported; modify and clarify the obligation to 
report data providing for the linking of original and clearing swaps 
and the original and clearing swap SDRs; remove the requirement for SD/
MSP reporting counterparties to report daily valuation data for cleared 
swaps; and would make conforming changes.
     Amendments to Sec.  45.5 would set forth a DCO's 
obligations to create, transmit, and use unique swap identifiers 
(``USIs'') to identify clearing swaps.
     Amendments to Sec.  45.8 would provide that the DCO will 
be the reporting counterparty for clearing swaps.
     Amendments to Sec.  45.10 would provide that all swap data 
for a given

[[Page 52547]]

clearing swap, and all swap data for each clearing swap that replaces a 
particular original swap (and each equal and offsetting clearing swap 
that is created upon execution of the same transaction and that does 
not replace an original swap), must be reported to a single SDR. 
Amendments would also make conforming changes.
     Amendments to appendix 1 would modify certain existing PET 
data fields and certain explanatory notes in the Comment sections for 
existing PET data fields, and would add several new PET data fields to 
account for the clarifications provided in this release for the 
reporting of clearing swaps.

II. Proposed Regulations

    Throughout Section II of this release, the Commission will outline 
each existing provision the Commission is proposing to amend, discuss 
each proposed amendment, and request comments about the proposed 
amendments. The Commission has also included several examples to 
demonstrate how cleared swap reporting workflows would function under 
the proposed revisions.

A. Definitions--Proposed Amendments to Sec.  45.1

1. Existing Sec.  45.1
    The Commission is proposing to revise the definition of 
``derivatives clearing organization'' in Sec.  45.1 and to add 
definitions for the terms ``original swap'' and ``clearing swap'' to 
Sec.  45.1.
2. Proposed Amendments and Additions to Sec.  45.1
i. ``Derivatives Clearing Organization''
    Currently, Sec.  45.1 defines ``derivatives clearing 
organization,'' as used in part 45, to have the meaning ``set forth in 
CEA section 1a(9), and any Commission regulation implementing that 
Section, including, without limitation, Sec.  39.5 of this chapter.'' 
However, the CEA currently defines ``derivatives clearing 
organization'' in section 1a(15), not section 1a(9).
    The Commission proposes to revise the definition of ``derivatives 
clearing organization'' in Sec.  45.1 so that it cross-references the 
definition provided in Sec.  1.3(d) of the Commission's regulations and 
so that it explicitly refers to a DCO registered with the Commission 
under section 5b(a) of the CEA.\28\ The proposed modification would 
redefine a ``derivatives clearing organization'' for purposes of part 
45 to mean ``a derivatives clearing organization, as defined by Sec.  
1.3(d) of this chapter, that is registered with the Commission.''
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    \28\ 7 U.S.C. 7a-1(a).
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ii. ``Original Swap'' and ``Clearing Swap''
    As discussed earlier in this release, a cleared-swap transaction 
generally comprises an original swap that is terminated upon novation, 
and the equal and opposite swaps that replace it, with the DCO as the 
counterparty for each swap that replaces the original swap.\29\ The 
existing part 45 regulations do not clearly delineate the swap data 
reporting requirements associated with each of the swaps involved in a 
cleared-swap transaction. Accordingly, the Commission proposes to add 
definitions of ``original swap'' and ``clearing swap'' to part 45 so 
that the part 45 reporting rules will be more consistent with the 
regulations applicable to DCOs set forth in Sec.  39.12(b)(6).
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    \29\ See 17 CFR 39.12(b)(6).
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    The Commission is proposing to define ``original swap'' as ``a swap 
that has been accepted for clearing by a derivatives clearing 
organization'' and ``clearing swap'' as ``a swap created pursuant to 
the rules of a derivatives clearing organization that has a derivatives 
clearing organization as a counterparty, including any swap that 
replaces an original swap that was extinguished upon acceptance of such 
original swap by the derivatives clearing organization for clearing.''
    As noted above, while a cleared-swap transaction generally 
comprises an original swap that is terminated upon novation and the 
equal and opposite swaps that replace it, the Commission is aware of 
certain circumstances in which a cleared swap transaction may not 
involve the replacement of an original swap.\30\ Accordingly, the 
proposed definition of ``clearing swap'' is intended to encompass: (1) 
Swaps to which the DCO is a counterparty and that replace an original 
swap (i.e., swaps commonly known as betas and gammas) and (2) all other 
swaps to which the DCO is a counterparty (even if such swap does not 
replace an original swap).
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    \30\ For example, in the preamble to the part 39 adopting 
release, the Commission noted that ``open offer'' systems are 
acceptable under Sec.  39.12(b)(6), stating that ``Effectively, 
under an open offer system there is no `original' swap between 
executing parties that needs to be novated; the swap that is created 
upon execution is between the DCO and the clearing member, acting 
either as principal or agent.''). ``Derivatives Clearing 
Organization General Provisions and Core Principles,'' 76 FR 69334, 
69361, Nov. 8, 2011.
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    As noted above, while original swaps are commonly referred to as 
``alpha'' swaps and while the equal and opposite swaps that replace the 
original swap are commonly referred to as ``beta'' and ``gamma'' swaps, 
the Commission will use the proposed defined terms ``original swap'' 
and ``clearing swap'' throughout this section of the release.
    The proposed definition of original swap will provide clarity with 
respect to certain continuation data reporting requirements for such 
swaps by tying such obligations to a specific point in time in the life 
of a swap that is either intended to be submitted to a DCO for clearing 
at the time of execution, or that is not intended to be cleared at the 
time of execution but is later submitted to a DCO for clearing. The 
Commission notes that under the proposed definition, a swap that is 
submitted to a DCO for clearing can become an original swap by virtue 
of the DCO's acceptance of such swap for clearing, irrespective of: (1) 
Whether such swap is executed on or pursuant to the rules of a SEF or 
DCM or off-facility; (2) whether or not such swap is subject to the 
clearing requirement; and (3) whether such swap is intended to be 
cleared at the time of execution or not intended to be cleared at the 
time of execution, but subsequently submitted to a DCO for 
clearing.\31\
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    \31\ See 17 CFR 39.12(b)(6). Clearing swaps would not be 
executed on or pursuant to the rules of a SEF or DCM as such swaps 
are created by a DCO.
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3. Request for Comment
    The Commission requests comment on all aspects of the proposed 
revised and proposed new definitions in Sec.  45.1. The Commission also 
invites comments on the following:
    (1) Is the Commission's proposed definition of ``original swap'' 
sufficiently clear and complete? If not, please provide detail about 
aspects of the definition that you believe are insufficiently clear or 
inadequately addressed.
    (2) Is the Commission's proposed definition of ``clearing swap'' 
sufficiently clear and complete, and does it, together with the 
proposed definition of ``original swap,'' adequately account for all 
components of a cleared swap transaction and for all types of cleared 
swap transactions? If not, please provide detail about aspects of the 
definition that you believe are insufficiently clear or inadequately 
addressed.
    (3) Is the Commission's proposed revised definition of 
``derivatives clearing organization'' sufficiently clear and complete? 
If not, please provide detail about aspects of the definition that you 
believe are insufficiently clear or inadequately addressed.
    (4) Are any other new defined terms necessary regarding swap data

[[Page 52548]]

recordkeeping and reporting requirements of part 45 with respect to 
cleared swaps?
    (5) Are the terms as defined in Sec.  45.1 adequately clear with 
respect to the existing swap data recordkeeping and reporting 
requirements of part 45? If not, please explain.

B. Swap Data Reporting: Creation Data--Proposed Amendments to Sec.  
45.3

1. Existing Sec.  45.3
    Regulation 45.3 requires reporting to an SDR of two types of 
``creation data'' generated in connection with a swap's creation: 
``Primary economic terms data'' and ``confirmation data.'' \32\ 
Regulation 45.3 governs what creation data must be reported, who must 
report it, and deadlines for its reporting.
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    \32\ Section 45.1 defines ``required swap creation data'' as 
primary economic terms data and confirmation data. Section 45.1 
defines ``primary economic terms data'' as ``all of the data 
elements necessary to fully report all of the primary economic terms 
of a swap in the swap asset class of the swap in question'' and 
defines ``confirmation data'' as ``all of the terms of a swap 
matched and agreed upon by the counterparties in confirming the 
swap. For cleared swaps, confirmation data also includes the 
internal identifiers assigned by the automated systems of the 
derivatives clearing organization to the two transactions resulting 
from novation to the clearing house.'' 17 CFR 45.1.
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    Regulation 45.3 imposes swap data reporting requirements with 
respect to both primary economic terms data and confirmation data to 
different reporting counterparties and entities depending on whether 
the swap is executed on or pursuant to the rules of a SEF or DCM (Sec.  
45.3(a)), subject to mandatory clearing and executed off-facility 
(Sec.  45.3(b)), or not subject to mandatory clearing and executed off-
facility (Sec.  45.3(c) and (d)). Regulation 45.3 also addresses 
specific creation data reporting requirements in circumstances where a 
swap is accepted for clearing by a DCO,\33\ including excusing the 
reporting counterparty from reporting creation data in certain 
circumstances.\34\
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    \33\ See 17 CFR 45.3(a)(2), (b)(2), (c)(1)(ii), (c)(2)(ii), and 
(d)(2).
    \34\ See 17 CFR 45.3(b)(1), (c)(1)(i), (c)(2)(i), and (d)(1).
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2. Proposed Amendments to Sec.  45.3
    As noted above, the Commission has had an opportunity to observe 
how the part 45 regulations function in practice with respect to swaps 
that are cleared. While CEA section 2(a)(13)(G) requires each swap 
(whether cleared or uncleared) to be reported to a registered SDR, the 
Commission understands that the interplay between the Sec.  45.3 
reporting requirements applicable to SEFs, DCMs and reporting 
counterparties, and the reporting requirements applicable to DCOs, 
could benefit from greater clarity regarding how the subsections of 
Sec.  45.3 assign reporting responsibilities for each of the swaps 
involved in a cleared-swap transaction. Accordingly, the Commission 
proposes several additions and deletions so that Sec.  45.3 will better 
delineate the creation data reporting requirements associated with each 
swap involved in a cleared swap transaction. The Commission also 
proposes several modifications to clarify existing requirements.
i. Proposed Revised References to Clearing Requirement Exceptions and 
Exemptions
    Currently, Sec. Sec.  45.3 and 45.8 include references to the end-
user exception to the swap clearing requirement set forth in section 
2(h)(7) of the CEA. Following the publication of the Final Part 45 
Rulemaking, the Commission codified the end-user exception in Sec.  
50.50 and published Two exemptions to the swap clearing requirement: 
The inter-affiliate exemption (Sec.  50.52) and the financial 
cooperative exemption (Sec.  50.51). The Commission is thus proposing 
to revise the introductory language of Sec.  45.3, Sec. Sec.  45.3(b) 
through (d), and 45.8(h)(1)(vi) to reflect that exceptions to, and 
exemptions from the clearing requirement are now codified in part 50 of 
the Commission's regulations.
ii. Proposed Addition of Sec.  45.3(e)--Clearing Swaps
    Currently, paragraphs (a) through (d) of Sec.  45.3 govern creation 
data reporting for swaps executed on or pursuant to the rules of a SEF 
or DCM and for off-facility swaps, but do not separately address 
creation data reporting for swaps created through the clearing process 
by a DCO (i.e., clearing swaps). Accordingly, the Commission is 
proposing to renumber existing paragraph (e) (Allocations) of Sec.  
45.3 as paragraph (f), and to add newly proposed paragraph (e) to Sec.  
45.3, which would exclusively govern creation data reporting 
requirements for clearing swaps. The Commission also proposes to revise 
the introductory language of Sec.  45.3 to make clear that paragraphs 
(a) through (d) apply to all swaps except clearing swaps, while 
paragraph (e) applies to clearing swaps.
    The proposed revisions to Sec.  45.3(e) would require a DCO, as 
reporting counterparty under proposed Sec.  45.8(i),\35\ to report all 
required swap creation data for each clearing swap, either as soon as 
technologically practicable after an original swap is accepted by the 
DCO for clearing (in the event that the clearing swap replaced an 
original swap), or as soon as technologically practicable after 
execution of a clearing swap (in the event that the clearing swap does 
not replace an original swap). Additionally, under the proposed 
revisions to Sec.  45.3(e), required swap creation data for clearing 
swaps must be provided to a registered SDR electronically by the DCO 
and must include all primary economic terms (``PET'') data and all 
confirmation data for each clearing swap.
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    \35\ Currently, Sec.  45.8 establishes a hierarchy under which 
the reporting counterparty for a particular swap is determined, 
depending generally on the registration status of the counterparties 
involved in the swap. That hierarchy does not explicitly mention 
DCOs. Accordingly, the Commission is proposing Sec.  45.8(i), which 
would establish the DCO as the reporting counterparty for all 
clearing swaps. This proposed change is discussed in greater detail 
in Section II.E. of this release. The Commission is also proposing 
conforming amendments to Sec.  45.4(b)(1) and (2) to add the phrase 
``as reporting counterparty'' after ``derivatives clearing 
organization'' to make clear that the DCO will be the reporting 
counterparty for purposes of those provisions.
---------------------------------------------------------------------------

    As noted above, CEA section 2(a)(13)(G) requires each swap (whether 
cleared or uncleared) to be reported to a registered SDR. Proposed 
paragraphs (a) through (e) of Sec.  45.3 would thus cover creation data 
reporting requirements for all swaps: Existing Sec.  45.3(a) applies to 
``each swap executed on or pursuant to the rules of a [SEF] or [DCM],'' 
existing Sec.  45.3(b) through (d) applies to ``all off-facility 
swaps,'' and proposed Sec.  45.3(e) would apply to clearing swaps. The 
provisions of Sec.  45.3(a) through (d) as proposed to be amended in 
this release would thus exclude clearing swaps. Under the proposed 
revisions and amendments to Sec.  45.3, a SEF/DCM or counterparty other 
than the DCO will not have swap data reporting obligations with respect 
to clearing swaps. Additionally, proposed Sec.  45.3(a) through (d) 
would govern the creation data reporting requirements for swaps, 
including swaps commonly known as ``alpha'' swaps, regardless of 
whether they later become original swaps by virtue of their acceptance 
for clearing.\36\
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    \36\ Swaps created by a DCO under Sec.  39.12(b)(6) are a type 
of clearing swap as defined in this release, and thus could not be 
executed on or pursuant to the rules of a SEF or DCM. Additionally, 
a DCO would not report creation data for a swap that was executed on 
or pursuant to the rules of a SEF or DCM, or for an off-facility 
swap that is submitted to the DCO for clearing, because, under Sec.  
45.3(a) through (d), the SEF/DCM or reporting counterparty would be 
responsible for reporting creation data for such swaps after 
execution. Under the proposed revisions to Sec.  45.3, a DCO will 
not have creation data reporting obligations for swaps to which it 
is not a counterparty and that are not clearing swaps.
---------------------------------------------------------------------------

    In response to the Commission's 2014 request for comment, 
commenters disagreed as to whether part 45 should

[[Page 52549]]

require intended to be cleared alpha swaps to be reported to registered 
SDRs. Some commenters noted that reporting of alpha swaps should 
continue to be required.\37\ One commenter noted that the reporting of 
alpha swaps provides useful information about the execution of the 
alpha swap and information regarding the life cycle of a cleared swap 
transaction.\38\ Other commenters noted that the requirement to report 
alpha swaps should not be waived as it is essential for the Commission 
to know the origins of a cleared swap transaction, and because the 
reporting of alpha swaps provides information necessary for 
surveillance and audit-trail purposes.\39\
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    \37\ See TR SEF letter, AFR letter, Markit letter, and DTCC 
letter.
    \38\ See AFR letter at 5 (noting that ``Information related to 
swaps clearing is particularly important and in general all life 
cycle information relevant to tracking a swap from initial 
conception through clearing should be included in swaps reporting 
(including the reporting of the initial `alpha' swap prior to 
novation into clearing). Such life cycle information will be 
particularly useful in tracking trends in clearing use in swaps 
markets, including both enforcement of the clearing mandate and also 
the optional use of clearing.'')
    \39\ See Markit letter at 25 (``The reporting requirements in 
relation to the alpha swap should not be modified or waived. This is 
because it will often be essential for the Commission to know the 
exact origin of a cleared swap transaction, in particular for market 
surveillance purposes.''); TR SEF letter at 10 (``We do not believe 
that the reporting requirements for an alpha swap should be waived 
because this information is necessary for surveillance and audit 
trail purposes . . . If only the beta and gamma swaps are reported, 
then the Commission would not easily see where the swap was 
originally executed.''); DTCC letter at 17-18 (arguing that any 
changes to the Commission's reporting requirements which would not 
require the reporting of swap transaction data to SDRs for all swaps 
would be inconsistent with the CEA, and noting that ``[i]n order to 
understand the origins of cleared swaps, regulators must have the 
ability to access and examine the connections between the alpha, 
beta, and gamma swaps. If the Commission's oversight were limited to 
cleared swap data, it would not be able to develop a detailed and 
comprehensive understanding of a swap transaction, the trading 
activities of market participants, or the detection of any 
violations.'').
---------------------------------------------------------------------------

    On the other hand, some commenters contended that alpha swaps 
should not be required to be reported to an SDR.\40\ One commenter 
stated that there is little value in reporting alpha swaps that are 
intended to be cleared as such swaps are, within a short time, 
superseded by beta and gamma swaps.\41\ Another commenter suggested 
that separately reporting alpha swaps can result in misleading data and 
could result in double-counting of swap transactions.\42\ One commenter 
asserted that part 43 reporting and other relevant rules provide the 
necessary information regarding the execution event.\43\
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    \40\ See SIFMA letter, CEWG letter, MFA letter, and ISDA letter.
    \41\ See ISDA letter at 43 (``Therefore there is little value to 
reporting creation data, either PET or confirmation, for alpha swaps 
since they are almost immediately superseded by the cleared swaps, 
and thus are not meaningful to an analysis of counterparty exposure. 
We agree that the Part 45 reporting requirement for alpha swaps that 
are required to be cleared or executed with the intent to clear (and 
subsequently cleared) should be waived.'').
    \42\ See SIFMA letter at 4 (noting that ``. . . separately 
reporting alpha swaps to SDRs can result in misleading data being 
retained by SDRs. This is particularly concerning if alpha swaps and 
the subsequent beta-gamma swaps are reported to different SDRs, 
which could potentially result in the double-counting of swaps.'').
    \43\ See LCH letter at 10 (``Part 45 reporting is not necessary 
to the extent that the information required by the Commission 
regarding the execution event is already captured directly from the 
execution venue or the execution counterparties under Part 43 or 
other relevant rules.'').
---------------------------------------------------------------------------

    The Commission agrees with commenters who argued that alpha swaps 
should be required to be reported. As these commenters stated, alpha 
swaps contain information regarding the origins of a cleared swap 
transaction that is essential for market surveillance and audit-trail 
purposes. It is important that this information be reported reliably 
based on the reporting hierarchy established and sourced from the 
registered entity or reporting counterparty that the Commission 
believes has the easiest and fastest access to the data. Consistent 
reporting of alpha swap USIs in creation data for beta and gamma swaps, 
for instance, is crucial to the Commission's ability to trace the 
history of a cleared swap transaction from execution between the 
original counterparties to clearing novation. Similarly, determining 
when an alpha swap has been terminated aids the Commission's ability to 
analyze cleared swap activity and to review swap activity for 
compliance with the clearing requirement.
    Finally, commenters also espoused varying views on which 
counterparty or entity should have the part 45 obligation to report 
alpha swaps; these comments will be discussed in section II.G. of this 
release.
iii. Proposed Removal of Provisions
    As noted above, several current provisions of Sec.  45.3 impose 
certain creation data reporting requirements on a DCO in circumstances 
where a swap is accepted for clearing by a DCO. To ensure consistency 
with Sec.  39.12(b)(6), the Commission is proposing to remove these 
creation data reporting provisions (current Sec.  45.3(a)(2),\44\ 
(b)(2), (c)(1)(ii), (c)(2)(ii), and (d)(2)), and to replace them with 
new proposed Sec.  45.3(e), described above.
---------------------------------------------------------------------------

    \44\ The Commission is also proposing to renumber existing Sec.  
45.3(a)(1) as Sec.  45.3(a).
---------------------------------------------------------------------------

    Additionally, the Commission is proposing to remove portions of 
Sec.  45.3(b)(1), (c)(1)(i), (c)(2)(i), and (d)(1). Currently, where 
both a DCO and reporting counterparty have obligations under Sec.  45.3 
for reporting creation data for the same swap, these subsections excuse 
the reporting counterparty from reporting creation data if the swap is 
accepted for clearing before any PET data is reported by the reporting 
counterparty. Under the proposed rules, these excusal provisions would 
no longer be necessary because the proposed rules would require DCOs to 
report creation data only for clearing swaps, and not for swaps 
accepted for clearing (i.e., original swaps).
iv. Proposed Removal of Certain Confirmation Data Reporting 
Requirements
    Currently, Sec.  45.3(a) through (d) requires the SEF/DCM (Sec.  
45.3(a)) or the reporting counterparty (Sec.  45.3(b) through (d)) to 
report both PET and confirmation data in order to comply with their 
creation data reporting obligations. While one commenter suggested that 
confirmation data reported to an SDR should be the same for cleared and 
uncleared swaps,\45\ other commenters contended that confirmation data 
need not be reported if the swap is required or intended to be 
cleared.\46\ The Commission preliminarily believes that the 
confirmation data requirements for clearing swaps in proposed Sec.  
45.3(e) would provide the Commission with a sufficient representation 
of the confirmation data for a cleared swap transaction, because the 
original swap is extinguished upon acceptance for clearing and replaced 
by equal and opposite clearing swaps.
---------------------------------------------------------------------------

    \45\ See DTCC letter at 2 (stating that any differentiation 
between confirmation data reporting requirements for cleared and 
uncleared swaps would unnecessarily bifurcate reporting and 
potentially inhibit the Commission's oversight objectives).
    \46\ See ISDA letter at 8 (stating that confirmation data should 
not be required for an alpha trade that is intended for clearing at 
the point of execution because such data is not meaningful as the 
alphas will be terminated and replaced with cleared swaps 
simultaneously or shortly after execution, at which point 
confirmation data will be reported by the DCO), CME letter at 2, 3, 
8 (stating that for intended to be cleared swaps, including separate 
confirmation data elements as part of the reporting submission to 
the SDR is redundant and unnecessary, and that DCO rules already 
require the generation of a confirmation), ICE letter at 14 (stating 
that the Commission should require less information for cleared 
transaction confirmations since these confirmation terms are already 
defined in the relevant product specs and rulebooks of DCOs).
---------------------------------------------------------------------------

    Accordingly, for swaps that are intended to be submitted to a DCO 
for

[[Page 52550]]

clearing at the time of execution, the Commission proposes to amend 
Sec.  45.3(a), (b), (c)(1)(iii), (c)(2)(iii), and (d)(2) to remove the 
existing confirmation data reporting requirements. Under the modified 
rules, SEFs/DCMs and reporting counterparties would continue to be 
required to report PET data as part of their creation data reporting, 
but would be required to report confirmation data only for swaps that, 
at the time of execution, are not intended to be submitted to a DCO for 
clearing. For swaps that, at the time of execution, are intended to be 
submitted to a DCO for clearing, SEFs/DCMs and reporting counterparties 
would not be required to report confirmation data. If the swap is 
accepted for clearing by a DCO, the DCO would be required to report 
confirmation data for the clearing swaps pursuant to proposed Sec.  
45.3(e).\47\
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    \47\ The Commission notes that the proposed change would only 
impact certain confirmation data reporting and recordkeeping 
requirements in Sec.  45.3, and does not alter existing obligations 
to generate or exchange confirmations under other Commission 
regulations.
---------------------------------------------------------------------------

v. Proposed Revisions to Sec.  45.3(f)--Allocations
    The Commission is proposing to renumber existing Sec.  45.3(e), 
which governs creation data reporting for swaps involving allocation, 
as Sec.  45.3(f).\48\ The Commission is also proposing to replace the 
phrase ``original swap transaction'' in Sec. Sec.  45.3(f)(2) and 
45.8(h)(1)(vii)(D), and in the PET data tables found in Appendix 1 to 
part 45, with ``initial swap transaction'' to avoid confusion with the 
term ``original swap,'' which is proposed to be defined in Sec.  45.1.
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    \48\ The Commission also proposes to renumber Sec.  45.3 
paragraphs (f), (g), and (h) as paragraphs (g), (h), and (i), 
respectively.
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vi. Proposed Addition of Sec.  45.3(j): Choice of SDR
    Commenters requested that the Commission provide guidance as to who 
has the legal right to determine choice of SDR.\49\ In response, the 
Commission is proposing to add new Sec.  45.3(j) in order to explicitly 
establish which entity has the obligation to choose the SDR to which 
the required swap creation data is reported. As proposed, Sec.  45.3(j) 
would provide that: for swaps executed on or pursuant to the rules of a 
SEF or DCM (including swaps that may later become original swaps), the 
SEF or DCM will have the obligation to choose the SDR; for all other 
swaps (including for off-facility swaps and/or clearing swaps) the 
reporting counterparty (as determined in Sec.  45.8) will have the 
obligation to choose the SDR.\50\
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    \49\ See, e.g., LCH comment letter at 11.
    \50\ Section 45.3(j) as proposed generally reflects the language 
included in the preamble to the Final Part 45 Rulemaking, which 
provides that ``the SEF or DCM would select the SDR for platform-
executed swaps, and the reporting counterparty would choose the SDR 
for off-facility swaps.'' See 77 FR 2136, 2146, Jan. 13, 2012. Under 
the proposed rule, the DCO would have the obligation to choose the 
SDR for clearing swaps.
---------------------------------------------------------------------------

    While some commenters recommended that the Commission affirmatively 
codify the right of the DCO to select the SDR,\51\ other commenters 
stated that the Commission should empower the reporting counterparty of 
the original trade to select the SDR for the alpha, beta, and gamma 
swaps, regardless of how the swap was executed and whether or not it 
was cleared.\52\ The Commission believes that it is appropriate to 
place the obligation to choose the SDR with the entity that has the 
obligation to make the first report of all required swap creation data. 
Doing so permits the entity with the obligation to report required swap 
creation data to select an SDR with which it may be an existing user 
and to which the entity has established connectivity and developed the 
necessary technological protocols and procedures for reporting required 
swap creation data. The Commission also understands that, in practice, 
the choice of SDR is currently made by such entities.
---------------------------------------------------------------------------

    \51\ See ICE letter at 4-5 (stating that ``a DCO's choice to 
report beta and gamma swaps to an affiliated SDR is unambiguous,'' 
and that while the text of part 45 is silent as to whether a DCO 
selects the SDR for cleared swaps, the preambles to both part 45 and 
part 49 contemplate that a DCO can adopt rules identifying the SDR 
to which it will report).
    \52\ See Markit letter at 4, 25 (stating that this approach: 
would create a level playing field between SDRs, allowing them to 
compete based on the quality of their services; would be simple 
compared to assigning reporting obligations to various parties 
depending on the nature and status of the swap transaction; and 
would increase the utility of SDR data for the Commission and for 
market participants) and DTCC letter at 20-21 (recommending that the 
Commission clarify that DCOs must report data to the SDR that 
receives the data for the alpha and stating that concerns that have 
been raised regarding duplication of records for cleared swaps 
results from the Commission's decision to allow DCOs to report 
cleared swap data to their captive SDRs).
---------------------------------------------------------------------------

    By virtue of the addition of Sec.  45.3(j) and the revisions to 
Sec.  45.10,\53\ the entity with the obligation to report the initial 
required swap creation data would select the SDR to which all 
subsequent swap creation and continuation data for that swap would be 
reported by choosing the SDR to which such initial required swap 
creation data is reported. Thereafter, all required swap creation data 
and all required swap continuation data for a given swap would be 
reported to the same SDR used by the registered entity or 
counterparty.\54\
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    \53\ Proposed revisions to Sec.  45.10 are discussed in Section 
II.F below. As will be discussed in Section II.C below, by operation 
of Sec.  45.10, DCOs will be obligated to report all required 
continuation data for original swaps to the registered SDR (as 
selected by the SEF, DCM, or reporting counterparty pursuant to 
proposed Sec.  45.3(j)) to which required creation data for the swap 
was reported pursuant to Sec.  45.3(a) through (d).
    \54\ 17 CFR 45.10. See also section II.F.2, infra.
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    Finally, the Commission notes that it is aware that there are 
certain situations wherein SEFs, DCMs and reporting counterparties for 
off-facility swap transactions may report the part 43 data for a swap 
to an SDR prior to reporting the part 45 required creation data for the 
same swap. In such situations, the registered entity or reporting 
counterparty has effectively chosen the SDR for the swap prior to 
submitting the part 45 data, since, pursuant to Sec.  45.10, all swap 
data for a given swap is required to be reported to a single SDR.\55\ 
For example, if a swap is executed on or pursuant to the rules of SEF 
A, and SEF A immediately upon execution reports the part 43 data to SDR 
B, prior to reporting part 45 data, SEF A has effectively chosen SDR B 
as the SDR for all required creation data for the swap, because Sec.  
45.10 requires that all swap data for a given swap must be reported to 
a single SDR.\56\ Accordingly, in this example, part 45 required 
creation data must be reported to SDR B.
---------------------------------------------------------------------------

    \55\ Id.
    \56\ Id.
---------------------------------------------------------------------------

vii. Proposed Removal of Expired Compliance Date References
    Currently, Sec.  45.3(b), (c), and (d), and the introductory 
language to Sec.  45.3 include references to phase-in compliance dates 
that have since expired. The Commission is proposing to remove the 
references to the expired compliance dates in Sec.  45.3(b)(1)(i), 
(b)(1)(ii), (b)(2), (b)(2)(ii), (c)(1)(i)(A), (c)(1)(i)(B), 
(c)(2)(i)(A), (c)(2)(i)(B), (d)(1), and (d)(3), and in the introductory 
language to Sec.  45.3.
3. Request for Comment
    The Commission requests comment on all aspects of proposed new 
Sec.  45.3(e) and (j) and the proposed amendments to Sec.  45.3. The 
Commission also invites comments on the following:
    (6) At the time that a swap is accepted for clearing, are there 
entities other than the DCO that would have complete information about 
the clearing swaps and that would be better suited to report required 
creation data for clearing swaps?

[[Page 52551]]

    (7) Are there circumstances where the DCO would have complete 
information about the swap that becomes an original swap and would be 
better suited than the SEF/DCM or reporting counterparty to report 
creation data for such swap in a timely manner? If so, are there any 
reasons why the DCO should not be required to report creation data for 
the swap that would become the original swap?
    (8) Are the requirements of proposed Sec.  45.3(e) sufficiently 
clear and do such requirements adequately address the mechanics of the 
clearing process?
    (9) Do the requirements of renumbered Sec.  45.3(f) allow for 
complete, accurate, timely, and efficient reporting of allocations in 
light of the proposed definition of ``clearing swap'' and the proposed 
Sec.  45.3(e) creation data reporting requirements for clearing swaps?
    (10) Are the obligations set forth in amended Sec.  45.3 
sufficiently clear? If not, please explain.
    (11) Are there differences between the confirmation data for swaps 
that are, at the time of execution, intended to be submitted to a DCO 
for clearing, and the confirmation data for the swaps that replace such 
swap upon acceptance for clearing? If so, discuss how the Commission 
should require the reporting of confirmation data with respect to a 
cleared swap transaction.
    (12) Should another entity, other than the entity with the 
regulatory obligation to report the required swap creation data, be 
able to choose an SDR for reporting purposes? If so, please explain.
    (13) Are the industry data standards currently used by market 
participants sufficient to report required swap creation data as 
required in the amended, revised and/or newly proposed provisions of 
this release? If not, what are the specific insufficiencies, and how 
should they be addressed?

C. Swap Data Reporting: Continuation Data--Proposed Amendments to Sec.  
45.4

1. Existing Sec.  45.4
    Regulation 45.4 governs the reporting of swap continuation data to 
an SDR during a swap's existence through its final termination or 
expiration. This provision establishes the manner in which continuation 
data, including life cycle event data or state data, and valuation 
data,\57\ must be reported (Sec.  45.4(a)), and sets forth specific 
continuation data reporting requirements for both cleared (Sec.  
45.4(b)) and uncleared (Sec.  45.4(c)) swaps. For cleared swaps, Sec.  
45.4(b) currently requires that life cycle event data or state data be 
reported by the DCO, and that valuation data be reported by both the 
DCO and by the reporting counterparty (if the reporting counterparty is 
an SD or MSP).
---------------------------------------------------------------------------

    \57\ ``Required swap continuation data'' is defined in Sec.  
45.1 and includes ``life cycle event data'' or ``state data'' 
(depending on which reporting method is used) and ``valuation 
data.'' Each of these data types is defined in Sec.  45.1. ``Life 
cycle event data'' means ``all of the data elements necessary to 
fully report any life cycle event.'' ``State data'' means ``all of 
the data elements necessary to provide a snapshot view, on a daily 
basis of all of the primary economic terms of a swap . . .'' 
``Valuation data'' means ``all of the data elements necessary to 
fully describe the daily mark of the transaction, pursuant to CEA 
section 4s(h)(3)(B)(iii), and to Sec.  23.431 of this chapter if 
applicable.'' 17 CFR 45.1.
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    For uncleared swaps, Sec.  45.4(c) requires the reporting 
counterparty to report all required swap continuation data, including 
life cycle event data or state data, and valuation data.
2. Proposed Amendments to Sec.  45.4
    As noted earlier in this release, the Commission has had an 
opportunity to observe how the part 45 regulations function in practice 
with respect to swaps that are cleared. The Commission understands that 
Sec.  45.4 could benefit from greater clarity regarding continuation 
data reporting responsibilities for each of the swaps involved in a 
cleared swap transaction. Accordingly, the Commission proposes several 
revisions and additions so that Sec.  45.4 will better delineate the 
continuation data reporting requirements associated with each swap 
involved in a cleared swap transaction. In particular, the Commission 
proposes conforming changes to existing Sec.  45.4(a), revisions to 
existing Sec.  45.4(b) and to existing Sec.  45.4(c) (proposed to be 
renumbered as Sec.  45.4(d)), and the addition of new Sec.  45.4(c). 
Each proposed change is discussed in detail below.
i. Proposed Conforming Changes to Sec.  45.4(a)
    The Commission is proposing to revise the heading of Sec.  45.4(a) 
to read ``Continuation data reporting method generally'' to reflect 
that the continuation data reporting method requirements in Sec.  
45.4(a) apply to all swaps, regardless of asset class or whether the 
swap is an original swap, clearing swap or uncleared swap, whereas the 
continuation data reporting requirements in proposed Sec.  45.4(b), 
(c), and (d) would apply to clearing swaps, original swaps, and 
uncleared swaps, respectively.
ii. Proposed Revisions to Sec.  45.4(b)
    Regulation 45.4(b) currently governs continuation data reporting 
obligations for ``cleared swaps,'' but does not distinguish among the 
different swaps involved in a cleared swap transaction (i.e. original 
and clearing swaps). The Commission is thus proposing to revise the 
introductory language of Sec.  45.4(b) to replace the terms ``cleared 
swaps'' and ``swaps cleared by a derivatives clearing organization,'' 
which were not defined in the Final Part 45 Rulemaking, with the 
defined term ``clearing swaps.''
    The Commission is not proposing modifications to the DCO life-cycle 
event data or state data reporting requirements in Sec.  45.4(b)(1) or 
to the valuation data reporting requirements in Sec.  45.4(b)(2)(i). 
However, the Commission is proposing to remove existing Sec.  
45.4(b)(2)(ii), which requires a reporting counterparty that is an SD 
or MSP to report valuation data for cleared swaps daily, in addition to 
the valuation data that is required to be reported by the DCO pursuant 
to Sec.  45.4(b)(2)(i). Under the proposed revisions to Sec.  
45.4(b)(2), a reporting counterparty that is an SD or an MSP will not 
be required to report valuation data for clearing swaps; instead, the 
DCO would be the only swap counterparty required to report required 
continuation data, including valuation data, for clearing swaps.
    While one commenter contended that valuation data from SD/MSP swap 
counterparties is valuable information and that the Commission should 
require such information from SD/MSP counterparties for all swaps, 
cleared or uncleared,\58\ numerous commenters stated that only the DCO 
should have the responsibility to report valuation data for cleared 
swaps, and that the Commission should eliminate the requirement for an 
SD or MSP to report valuation data for cleared swaps.\59\
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    \58\ See Markit letter at 10-11 (arguing that the Commission 
might receive valuable information from valuations reported by 
counterparties).
    \59\ See ABA letter at 2, CME letter at 9-10, Financial Services 
Roundtable letter at 2, ICE letter at 2, 10, 15, ISDA letter at 13-
14, JBA letter at 2-3, MFA letter at 2, 4, NGSA letter at 4-5.
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    The valuation data reporting requirements applicable to DCOs 
pursuant to existing Sec.  45.4(b)(2)(i) should present sufficient 
information for the Commission to understand clearing swap valuations. 
Additionally, the proposed removal of Sec.  45.4(b)(2)(ii) would codify 
a series of no-action letters issued by Commission staff providing no-
action relief to SDs and MSPs from the continuation data reporting

[[Page 52552]]

obligations of that subsection for daily valuation data.\60\
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    \60\ See CFTC Division of Market Oversight, No-Action Letter No. 
12-55, Dec. 17, 2012; No-Action Letter No. 13-34, Jun. 26, 2013; and 
No-Action Letter No. 14-90, Jun. 30, 2014. Staff no-action relief 
from the requirements of Sec.  45.4(b)(2)(ii) has been in effect 
since the initial compliance date for part 45 reporting.
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iii. Proposed Addition of Sec.  45.4(c): Continuation Data Reporting 
for Original Swaps
    Currently, Sec.  45.4(c) governs continuation data reporting for 
uncleared swaps. The Commission is proposing to renumber Sec.  45.4(c) 
as Sec.  45.4(d) (discussed below), and is proposing the addition of a 
new Sec.  45.4(c), which would set forth the continuation data 
reporting requirements for original swaps.
    Specifically, proposed Sec.  45.4(c) would require a DCO to report 
all required continuation data for original swaps, including original 
swap terminations, to the SDR to which the swap that became such 
original swap was reported pursuant to Sec.  45.3(a) through (d).\61\ 
As proposed, Sec.  45.4(c) would also reference the existing 
requirement that all continuation data must be reported in the manner 
provided in Sec.  45.13(b), and that the SDR, in order to comply with 
Sec.  49.10, must also ``accept and record'' such data, including 
original swap terminations.\62\ The proposed addition of a reference to 
Sec.  49.10 is consistent with a commenter's request for clarification 
regarding the obligation of the SDR to accept and process the 
termination message from the DCO.\63\
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    \61\ As discussed earlier in this release, under the proposed 
revisions to Sec.  45.3(a) through (d), a SEF/DCM or reporting 
counterparty would be required to report creation data for all swaps 
except clearing swaps (including for swaps that later become 
original swaps by virtue of their acceptance for clearing by a DCO). 
See Section II.B.2., supra. See also Sec.  45.10 (a) through (c) 
(providing that all required swap continuation data reported for a 
swap must be reported to the same SDR to which required swap 
creation data was first reported pursuant to Sec.  45.3). The 
Commission notes that pursuant to existing regulation Sec.  45.13, 
each reporting entity and/or counterparty is required to ``use the 
facilities, methods, or data standards provided or required by the 
[SDR] to which the entity or counterparty reports the data.'' 17 CFR 
45.13.
    \62\ Rule Sec.  49.10(a) provides that an SDR ``shall accept and 
promptly record all swap data in its selected asset class and other 
regulatory information that is required to be reported pursuant to 
part 45 and part 43 of this chapter by [DCMs], [DCOs], [SEFs], 
[SDs], [MSPs] and/or non-swap dealer/non-major swap participant 
counterparties.'' Rule Sec.  49.10(a)(1) further provides that for 
``purposes of accepting all swap data as required by part 45 and 
part 43, the registered [SDR] shall adopt policies and procedures, 
including technological protocols, which provide for electronic 
connectivity between the [SDR] and [DCMs], [DCOs], [SEFs], [SDs], 
[MSPs] and/or certain other non-swap dealer/non-major swap 
participant counterparties who report such data. The technological 
protocols established by a [SDR] shall provide for the receipt of 
swap creation data, swap continuation data, real-time public 
reporting data, and all other data and information required to be 
reported to such [SDR]. The [SDR] shall ensure that its mechanisms 
for swap data acceptance are reliable and secure.'' 17 CFR 49.10. 
The Commission also proposes conforming changes to the introductory 
language of Sec.  45.3 and Sec.  45.4 to make clear that all 
required swap creation and continuation data must be reported to the 
relevant SDR in the manner provided in Sec.  45.13, and pursuant to 
Sec.  49.10, which sets forth rules governing the acceptance and 
recording of such data.
    \63\ See ICE letter at 4 (noting that failure to accept the 
termination message can produce inaccurate swap data due to double 
reporting and that the rejection of the termination message could 
distort notional amounts and market risks, and stating that amending 
the reporting rules to place the reporting obligation on the DCO for 
intended to be cleared swaps simplifies the reporting flows and 
places the responsibility on the party best-suited to accurately 
report cleared swap data).
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    As proposed, Sec.  45.4(c)(1) would require a DCO to report all 
life cycle event data for an original swap on the same day that any 
life cycle event occurs, or to report all state data for the original 
swap, daily.
    The continuation data reporting requirements of proposed Sec.  
45.4(c) would apply to a swap that has been submitted to a DCO for 
clearing and that becomes an original swap by virtue of the DCO's 
acceptance of such swap for clearing. The DCO's continuation data 
reporting obligations for a swap to which it is not a counterparty 
(i.e., for swaps other than clearing swaps) will only be triggered if a 
swap is accepted for clearing (and thus becomes an original swap). If a 
swap is submitted to a DCO for clearing and is not accepted for 
clearing, the DCO will not have continuation data reporting obligations 
for the swap, because the swap is not an original swap or a clearing 
swap.
    While some commenters recommended that the original counterparty, 
and not the DCO, should report termination of the alpha to the SDR,\64\ 
another commenter suggested that the DCO should report termination of 
the alpha to the SDR.\65\ The continuation data reporting methods for 
original swaps proposed in Sec.  45.4(c)(1) are consistent with those 
for ``cleared'' swaps currently found in Sec.  45.4(b)(1), which also 
places responsibility on the DCO to report life cycle event data or 
state data to the SDR. As proposed, Sec.  45.4(c)(1) would place the 
responsibility on the DCO to report the required continuation data for 
original swaps because the DCO, by virtue of its decision to accept a 
swap for clearing and extinguish the swap upon acceptance,\66\ controls 
when termination, a key life-cycle event for an original swap, occurs. 
Therefore, it is the Commission's view that the DCO is in the best 
position to report required continuation data for original swaps, as it 
has the easiest and quickest access to the information regarding the 
termination of such swaps.
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    \64\ See OTC Hong Kong letter at 2-3 (stating that requiring the 
original counterparty to report termination of the alpha would be 
more cost-effective because the original reporting counterparty is 
already required to report creation data and life cycle event data 
of such alpha to an SDR, and thus would already have in place a 
technical and operational interface with the SDR of its choice. The 
commenter also stated that imposing an additional requirement on a 
DCO to report termination of the alpha does not appear to increase 
or improve the quantity and quality of information already available 
to the Commission, and that the burden on DCOs of the additional 
reporting requirement appears to outweigh the benefits to the 
Commission) and LCH letter at 8 (stating that reporting entities 
should already report terminations under the obligation to report 
continuation data).
    \65\ See DTCC letter at 7 (stating that when an alpha swap is 
novated, the Commission should require a DCO to submit information 
about the beta and gamma swaps in addition to the termination notice 
for the alpha swap).
    \66\ See 17 CFR 39.12(b)(6). Through its rules, the DCO 
determines whether or not a swap that is submitted for clearing 
becomes an original swap.
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iv. Proposed Additional Continuation Data Fields To Be Reported by DCOs
    Several commenters asserted that the most cost-effective method for 
establishing a link between the original swaps and the swaps that 
replace the original swap upon acceptance for clearing is to include 
the USI of the original swap as a prior USI for the beta and gamma 
swaps.\67\ The Commission is of the view that reporting of the USI of 
the original swap as continuation data is an efficient mechanism for 
linking clearing swaps to the original swap that they replace and 
should be used for this purpose. As proposed, Sec.  45.4(c)(2) would 
thus require DCOs to include the following additional enumerated data 
elements when reporting continuation data for original swaps pursuant 
to proposed Sec.  45.4(c)(1): (i) The legal entity identifier (``LEI'') 
of the SDR to which each clearing swap for a particular original swap 
was reported by the DCO pursuant to new Sec.  45.3(e); (ii) the USI of 
the original swap that was replaced by the clearing swaps; \68\ and 
(iii) the USI

[[Page 52553]]

for the clearing swaps that replace the original swap.
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    \67\ See CME letter at 10 (``The most effective and efficient 
method for achieving linkage for all such events that have a one-to-
one relationship (i.e., assignment or exercise) or a one-to-many 
relationship (i.e., clearing, novation, allocation) is by the 
inclusion of a prior USI(s).)''; DTCC letter appendix at 3 (stating 
that a new swap can generally be linked to an existing swaps through 
the use of a ``prior USI'' data field); ISDA letter at 11 (``Related 
swaps sent to different SDRs can also be linked via use of the USI. 
. . .''); Markit letter at 8 (arguing that the most effective method 
to establish a link between new and existing swaps is to store the 
USI of the original swap as a prior USI).
    \68\ See existing Sec.  45.5(a)(2)(iii), (b)(2)(iii), and 
(c)(2)(ii) (requiring the entity that created the USI to transmit 
the USI of a swap ``to the [DCO], if any, to which the swap is 
submitted for clearing, as part of the required swap creation data 
transmitted to the derivatives clearing organization for clearing 
purposes''). Proposed revisions to Sec.  45.5 are described in 
Section II.D of this release.
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    These proposed data fields would enable the DCO to fulfill its 
continuation data reporting obligations, enable the SDR to maintain the 
accuracy and completeness of swap transaction data, and enable the 
Commission to track the life of a cleared swap transaction. In 
particular, including the LEI of the SDR where required swap creation 
data for each clearing swap was reported will permit the Commission and 
other regulators to ascertain the SDR where the clearing swaps 
associated with a particular original swap reside. This will enable the 
Commission and other regulators to review and more effectively 
associate data available at multiple SDRs in circumstances where the 
reporting entity or counterparty selects one SDR for the original swap 
and the DCO selects a different SDR for the clearing swaps under Sec.  
45.3.
    Inclusion of the original swap's USI is necessary to enable the SDR 
where the swap that became the original swap's creation data was 
reported to associate continuation data reported by the DCO with the 
initial creation data reported by a SEF/DCM or reporting counterparty 
pursuant to Sec.  45.3(a) through (d).\69\ Similarly, in the case of 
clearing swaps that replace an original swap, inclusion of the USIs of 
the clearing swaps will permit the Commission and other regulators to 
identify the specific clearing swaps that replaced an original swap, 
presenting a full history of the cleared swap transaction.
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    \69\ For instance, inclusion of the USI of the original swap in 
DCO continuation data reporting will permit the SDR receiving such 
continuation data to associate data regarding a life cycle event 
such as termination with the existing data maintained for the swap. 
This will help ensure that data in the SDR remains current and 
accurate and will enable the Commission and other regulators to 
ascertain whether a swap remains in existence or has been 
extinguished upon acceptance for clearing by a DCO.
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    Together, the proposed revisions to Sec.  45.4(b) and the addition 
of Sec.  45.4(c) would require the reporting of continuation data for 
original swaps and clearing swaps. Accordingly, the Commission expects 
that records of original swaps that have been terminated would include 
the USIs for the clearing swaps that replaced the original swap and the 
LEI of the clearing swap SDR, such that review of an original swap 
would permit the identification of, and note the SDR where, the 
clearing swaps reside. These provisions will reflect the regulations 
applicable to DCOs outlined in part 39 of the Commission's regulations 
and will clearly delineate the continuation data reporting obligations 
associated with each swap involved in a cleared swap transaction.\70\
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    \70\ See 17 CFR 39.12(b)(6). Part 45 currently requires all swap 
data and information reported to and maintained by an SDR regarding 
a given swap to be ``current and accurate'' and to include ``all 
changes'' to a swap. 17 CFR 45.4(a).
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v. Proposed Revisions to Sec.  45.4(d)
    As mentioned above, the Commission is proposing to renumber Sec.  
45.4(c) (Continuation data reporting for uncleared swaps) as Sec.  
45.4(d). The Commission is also proposing to amend Sec.  45.4(d), which 
applies to ``all swaps that are not cleared by a derivatives clearing 
organization,'' to add the phrase ``including swaps executed on or 
pursuant to the rules of a swap execution facility or designated 
contract market.'' This proposed change would clarify the existing 
requirement that reporting counterparties report all required swap 
continuation data for an uncleared swap, irrespective of whether the 
swap was executed off-facility (in which case the reporting 
counterparty must report required swap creation data), or whether the 
swap was executed on or pursuant to the rules of a SEF or DCM (in which 
case the SEF or DCM must report the required swap creation data).\71\
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    \71\ See 17 CFR 45.3(b) through (d) (creation data reporting 
requirements for off-facility swaps) and 17 CFR 45.3(a) (creation 
data reporting requirements for swaps executed on or pursuant to the 
rules of a SEF or DCM). See also section B.2.ii supra.
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    Finally, the Commission proposes to modify the introductory 
language to Sec.  45.4 and Sec.  45.4(d)(1)(ii)(A) to remove outdated 
references to compliance dates that have already expired.
3. Request for Comment
    The Commission requests comment on all aspects of proposed new 
Sec.  45.4(c) and the proposed amendments to Sec.  45.4. The Commission 
also invites comments on the following:
    (14) Would market participants other than DCOs be better placed to 
more efficiently incur the duty to report continuation data for 
original swaps? If so, how would placing continuation data reporting 
requirements on such other market participants further the goal of 
ensuring that swap data for original swaps remains ``current and 
accurate''?
    (15) Should the Commission consider any alternative approaches to 
reporting requirements for original swap terminations? If so, please 
describe such an approach.
    (16) Please describe whether there might be any life-cycle events 
for an original swap other than termination. Does Sec.  45.4(c) 
adequately address any such life-cycle events?
    (17) Would the valuation data that DCOs must currently report to 
SDRs pursuant to Sec.  45.4(b)(2)(i) present sufficient information for 
the Commission to understand clearing swap valuations? Explain why this 
is or is not the case.
    (18) What value, if any, would the Commission gain by receiving 
clearing swap valuation data from SD/MSP reporting counterparties?
    (19) Do the continuation data reporting requirements and existing 
definition of life-cycle event found in Sec.  45.1 adequately address 
the possible range of events that could occur during the life of a 
clearing swap?
    (20) Should the Commission require original swap terminations to be 
reported as soon as technologically practicable after termination of an 
original swap?
    (21) Should both the life cycle event method and state data method 
for continuation data reporting be permitted for clearing swaps? Please 
provide information about the advantages and disadvantages of each 
method with respect to clearing swaps.
    (22) Do the proposed revisions to Sec.  45.4 provide sufficient 
clarity concerning the reporting of continuation data for all life 
cycle events required to be reported, including any modifications to 
the clearing swaps? If not, what areas require further clarity?
    (23) For a swap executed on or pursuant to the rules of a SEF or 
DCM, as well as for off-facility swaps, would the DCO to which the swap 
is submitted for clearing have the information necessary, at the time 
of submission for clearing, to report the required continuation data, 
including a notice of termination of the swap, to the SDR to which the 
SEF or DCM reported the swap?
    (24) Are current industry data standards sufficient for DCOs to 
report required swap continuation data to the appropriate SDRs in a 
manner that would be consistent with proposed Sec.  45.4? If not, what 
are the specific insufficiencies and how should they be addressed?
    (25) Are the obligations that would be assigned in the proposed 
amendments to Sec.  45.4 sufficiently clear? If not, please explain.

[[Page 52554]]

D. Unique Swap Identifiers--Proposed Amendments to Section 45.5

1. Existing Sec.  45.5
    Regulation 45.5 currently requires that each swap subject to the 
Commission's jurisdiction be identified in all recordkeeping and all 
swap data reporting by the use of a USI. The rule establishes different 
requirements for the creation and transmission of USIs depending on 
whether the swap is executed on a SEF or DCM (Sec.  45.5(a)), executed 
off-facility with an SD or MSP reporting counterparty (Sec.  45.5(b)), 
or executed off-facility with a non-SD/MSP reporting counterparty 
(Sec.  45.5(c)). Existing Sec.  45.5 provides that for swaps executed 
on a SEF or DCM, the SEF or DCM creates the USI, and for swaps not 
executed on a SEF or DCM, the USI is created by an SD or MSP reporting 
counterparty, or by the SDR if the reporting counterparty is not an SD 
or MSP.\72\
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    \72\ See Sec.  45.5(a) through (c).
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    With the exception of swaps with a non-SD/MSP reporting 
counterparty, the existing rule generally requires USI creation and 
transmission to be carried out by the entity or counterparty required 
to report all required swap creation data for the swap. Section 45.5 
thus does not currently distinguish between original and clearing 
swaps, does not provide USI creation and transmission requirements 
specifically for DCOs, and consequently does not provide for the 
issuance to DCOs of a USI ``namespace,'' which is one of two component 
parts of a USI.\73\
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    \73\ See, e.g., Sec.  45.5(a)(1)(i), (b)(1)(i) and (c)(1)(i) 
(the data component of a USI commonly referred to as a namespace is 
the unique alphanumeric code assigned to the registered entity 
responsible for generating the USI for the purpose of identifying 
such registered entity with respect to USI creation).
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    The Commission understands that in market practice, SEFs/DCMs and 
reporting counterparties, or SDRs in the case of non-SD/MSP reporting 
counterparties, generate and assign USIs for swaps that would become 
original swaps under the proposed rules, and that DCOs generate and 
assign USIs to swaps that would qualify as clearing swaps in connection 
with reporting required swap creation data for clearing swaps to SDRs.
2. Proposed Amendments to Sec.  45.5
    The Commission is proposing to renumber existing Sec.  45.5(d) as 
Sec.  45.5(e) and to create a new Sec.  45.5(d) which would set forth 
requirements regarding the creation and transmission of USIs for 
clearing swaps.\74\
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    \74\ The Commission also proposes conforming amendments to 
renumber existing Sec.  45.5(e) as Sec.  45.5(f).
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    As proposed, Sec.  45.5(d)(1) would require a DCO to generate and 
assign a USI for each clearing swap upon, or as soon as technologically 
practicable after, acceptance of an original swap by the DCO for 
clearing (or execution of a clearing swap that does not replace an 
original swap), and prior to reporting the required swap creation data 
for each clearing swap. Proposed Sec.  45.5(d)(1) would also require 
that the USI for each clearing swap consist of two data components: A 
unique alphanumeric code assigned to the DCO by the Commission for the 
purpose of identifying the DCO with respect to USI creation; and an 
alphanumeric code generated and assigned to that clearing swap by the 
automated systems of the DCO. These proposed USI creation requirements 
and components for DCOs and clearing swaps are consistent with those 
currently required by part 45 for other registered entities such as 
SEFs, DCMs, and SDRs.\75\
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    \75\ See, e.g., 17 CFR 45.5(a), 45.5(c).
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    As proposed, Sec.  45.5(d)(2) would require a DCO to transmit the 
USI for a clearing swap electronically to the SDR to which the DCO 
reports required swap creation data for the clearing swap, as part of 
that report; and to the DCO's counterparty with respect to that 
clearing swap, as soon as technologically practicable after either 
acceptance of the original swap by the DCO for clearing or execution of 
a clearing swap that does not replace an original swap. The proposed 
Sec.  45.5(d) provisions governing creation and assignment of USIs by 
the DCO with respect to clearing swaps are consistent with the 
Commission's ``first-touch'' approach to USI creation for SEFs, DCMs, 
SDs, MSPs, and SDRs.\76\
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    \76\ See 77 FR 2136, 2158 (Jan. 13, 2012). The Commission's 
approach with respect to SEFs, DCMs, SDs, MSPs, and SDRs was 
designed to foster efficiency by taking advantage of the 
technological sophistication and capabilities of such entities, 
while ensuring that a swap is identified by a USI from its 
inception.
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    Finally, the Commission proposes to amend Sec. Sec.  45.5(a), 
45.8(f), and 45.10(a) to incorporate the language ``or pursuant to the 
rules of'' to the phrase ``swaps executed on a swap execution facility 
or designated contract market'' to make clear that those provisions 
currently apply to all swaps executed on or pursuant to the rules of a 
SEF or DCM.
3. Request for Comment
    The Commission requests comment on all aspects of proposed Sec.  
45.5(d). The Commission also invites comments on the following:
    (26) Should an entity other than the DCO be required to create and 
transmit USIs for clearing swaps?
    (27) Do the proposed requirements of Sec.  45.5(d)(2) ensure that 
all relevant entities will receive the USI for a particular clearing 
swap?
    (28) Should the proposed USI creation and transmission requirements 
for DCOs differ from those of other registered entities such as SEFs, 
DCMs and SDRs? If so, please explain how and why the requirements 
should differ.

E. Determination of Which Counterparty Must Report--Proposed Amendments 
to Sec.  45.8

1. Existing Sec.  45.8
    Regulation 45.8 sets forth a hierarchy under which the reporting 
counterparty for a particular swap depends on the nature of the 
counterparties involved in the transaction. Regulation 45.8 assigns a 
reporting counterparty for off-facility swaps, for which the reporting 
counterparty must report all required swap creation data, as well as 
for swaps executed on or pursuant to the rules of a SEF or DCM, for 
which the SEF or DCM must report all required swap creation data.
2. Proposed Amendments to Sec.  45.8
    Existing Sec.  45.8 could be improved to better reflect the 
mechanics for cleared swap transactions. While existing Sec.  45.3 
currently imposes certain creation data reporting requirements on the 
DCO in connection with a swap that is accepted for clearing, the 
hierarchy currently set forth in Sec.  45.8 does not expressly include 
a separate designation for the DCO as a reporting counterparty.
    As discussed earlier in this release, a cleared swap transaction 
generally involves an original swap that is terminated upon novation, 
and the equal and opposite swaps that replace it, with the DCO as the 
counterparty for each swap that replaces the original swap.\77\ 
Accordingly, the Commission is proposing to add paragraph (i) to Sec.  
45.8 in order to explicitly provide that the DCO will be the reporting 
counterparty for clearing swaps. This proposed change is consistent 
with part 39, which requires that the DCO must be a counterparty to 
each swap that replaces an original swap and must have rules governing 
acceptance and replacement of an original swap.\78\ The DCO is also the 
entity that should have the easiest

[[Page 52555]]

and quickest access to full information with respect to PET data and 
confirmation data for clearing swaps, placing the DCO in the best 
position to report all required swap creation data for the clearing 
swaps.
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    \77\ See 17 CFR 39.12(b)(6).
    \78\ Id. (providing that a DCO that clears swaps must have rules 
providing that upon acceptance of a swap by the DCO for clearing, 
the ``original swap is replaced by an equal and opposite swap 
between the [DCO] and each clearing member . . .'').
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    The Commission is also proposing to amend the introductory language 
of Sec.  45.8 to make clear that the reporting counterparty for all 
swaps except clearing swaps will be made as provided in paragraphs (a) 
through (h) of Sec.  45.8, while the reporting counterparty for 
clearing swaps will be made as provided in paragraph (i) of Sec.  45.8.
    The Commission also proposes to remove the language ``if 
available'' from Sec.  45.8(h)(1)(i) to ensure consistency with 
proposed changes to appendix 1 to part 45 and because this language was 
only relevant prior to availability of the LEI system.
    Finally, the Commission proposes to further amend Sec.  45.8 to 
remove part of paragraphs (d)(1) and (f)(1) and to remove part of 
paragraph (h)(2) and all of paragraphs (h)(2)(i) and (ii). Section 
45.8(h) currently provides that if the SEF/DCM is unable to determine 
which counterparty to a swap is the reporting counterparty, it must 
notify each counterparty that it cannot identify which counterparty is 
the reporting counterparty, and must also transmit to each counterparty 
the LEI of the other counterparty. The removal of these paragraphs 
would ensure that swaps that are executed anonymously on a SEF or DCM, 
and then cleared in accordance with the Commission's straight-through 
processing requirements, remain anonymous.\79\ Section 45.8(d)(1) and 
(f)(1) contemplate a process whereby the counterparties agree which 
counterparty shall be the reporting counterparty no later than the end 
of the first business day following the date of execution of the swap. 
The removal of these paragraphs will provide for a more streamlined 
process with respect to the determination of the reporting counterparty 
for swaps where paragraphs (d)(1) or (f)(1) apply. SEFs and DCMs have 
adopted rules governing determination of the reporting counterparty for 
all swaps executed on or pursuant to the rules of a SEF or DCM, which 
eliminates the need for these portions of Sec.  45.8(d)(1), (f)(1), and 
(h)(2). The Commission is also proposing conforming changes to 
explanatory notes in the PET data tables in appendix 1 to part 45 that 
reference the situation described in Sec.  45.8(h)(2).
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    \79\ The Commission notes that Sec.  49.17(f)(2) prohibits SDRs 
from disclosing the identity or LEI of a counterparty for swaps that 
are executed anonymously on a SEF or DCM, and then cleared in 
accordance with the Commission's straight-through processing 
requirements, when counterparties to a particular swap are allowed 
access to data related to the swap. See ``Swap Data Repositories--
Access to SDR Data by Market Participants,'' 79 FR 16672, Mar. 26, 
2014.
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3. Request for Comment
    The Commission requests comment on all aspects of proposed Sec.  
45.8(i). The Commission also invites comments on the following:
    (29) Are the proposed additions of Sec. Sec.  45.8(i) and 45.3(j), 
along with existing Sec.  45.8, sufficiently clear with respect to the 
determination of the reporting counterparty and the choice of SDR? 
Please explain any scenarios for which the determination of the 
reporting counterparty or choice of SDR would not be sufficiently 
clear.

F. Reporting to a Single Swap Data Repository--Proposed Amendments to 
Sec.  45.10

1. Existing Sec.  45.10
    Regulation 45.10 currently requires ``all swap data for a given 
swap'' to be reported to a single SDR, which must be the same SDR to 
which creation data for that swap is first reported. The time and 
manner in which such data must be reported to a single SDR depends on 
whether the swap is executed on a SEF or DCM (Sec.  45.10(a)), executed 
off-facility with an SD/MSP reporting counterparty (Sec.  45.10(b)), or 
executed off-facility with a non-SD/MSP reporting counterparty (Sec.  
45.10(c)). Currently, Sec.  45.10(b) and (c) also discuss circumstances 
in which a reporting counterparty is excused from reporting PET data to 
an SDR because the swap is accepted for clearing by a DCO before the 
applicable reporting deadline.
2. Proposed Amendments to Sec.  45.10
    In order to further clarify that ``all swap data for a given swap'' 
encompasses all swap data required to be reported pursuant to parts 43 
and 45 of the Commission's regulations, the Commission is proposing to 
add language to this effect to paragraphs (a) through (c) and to the 
introductory language of Sec.  45.10. This proposed additional language 
would clarify the existing requirement that registered entities and 
reporting counterparties must provide all swap data required under 
parts 43 and 45 to a single SDR for a given swap.\80\
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    \80\ The Commission is also proposing to repeat the language 
``Off-facility swaps with a swap dealer or major swap participant 
reporting counterparty'' from the title of Sec.  45.10(b) in the 
body of that regulation to make clear that the requirement pertains 
to off-facility swaps with an SD or MSP.
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    The Commission is also proposing to remove Sec.  45.10(b)(2) and 
(c)(2).\81\ These two paragraphs are no longer applicable because they 
reference provisions in Sec.  45.3(b)(1), (c)(1)(i), and (c)(2)(i) 
that, as discussed earlier in this release, the Commission is proposing 
to remove.\82\
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    \81\ The Commission also proposes conforming amendments to Sec.  
45.10 to renumber paragraph (b)(3) as (b)(2), paragraph (c)(3) as 
(c)(2), and paragraph (c)(4) as (c)(3). The Commission also proposes 
to remove a reference to Sec.  45.10(c)(2) from existing Sec.  
45.10(c)(4) because the Commission is proposing to remove Sec.  
45.10(c)(2).
    \82\ See Section II.B.2.ii, supra.
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    The Commission is proposing to add new Sec.  45.10(d), which would 
govern clearing swaps and would establish explicit requirements that 
DCOs report all required swap creation data and all required swap 
continuation data for each clearing swap to a single SDR. Specifically, 
proposed Sec.  45.10(d)(1) would require a DCO to report all required 
swap creation data for a particular clearing swap to a single SDR. As 
proposed, Sec.  45.10(d)(1) would also require the DCO to transmit the 
LEI of the SDR to which it reported the required swap creation data for 
each clearing swap to the counterparty of each clearing swap, as soon 
as technologically practicable after either acceptance of the original 
swap by the DCO for clearing or execution of a clearing swap that does 
not replace an original swap.
    As proposed, Sec.  45.10(d)(2) would require a DCO to report all 
required swap creation data and all required swap continuation data for 
a particular clearing swap to the same SDR that received the initial 
swap creation data for the clearing swap required by Sec.  45.10(d)(1).
    In the event there are clearing swaps that replace a particular 
original swap, and in the event there are equal and opposite clearing 
swaps that are created upon execution of the same transaction and that 
do not replace an original swap, Sec.  45.10(d)(3) would require the 
DCO to report all required swap creation and continuation data for each 
such clearing swap to a single SDR.\83\ Accordingly, all required 
creation data and all required continuation data for all clearing swaps 
that can be traced back to the same original swap (and for all equal 
and opposite clearing swaps that are created upon execution of the same 
transaction but that do not replace

[[Page 52556]]

an original swap) will be reported to a single SDR.
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    \83\ The Commission notes that proposed Sec.  45.10(d)(3) would 
require any equal and opposite clearing swaps, including those 
resulting from the operation of Sec.  39.12(b)(6) of the 
Commission's regulations, to be reported to a single SDR, regardless 
of whether such clearing swaps replaced an original swap.
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    The Commission notes that by operation of proposed new Sec.  
45.8(i) and (j) and proposed Sec.  45.3(e), there may be scenarios in 
which the SEF/DCM or reporting counterparty reports required swap 
creation data for the swap that became the original swap to one SDR, 
and the DCO reports required swap creation data for the clearing swaps 
that replace the original swap to a different SDR. While some 
commenters stated that the Commission should require resulting swaps to 
be reported to the same SDR as original swaps,\84\ the Commission is 
proposing to require that all swap data for the clearing swaps that can 
be traced back to the same original swap be reported to the same SDR, 
but is not requiring that the clearing swaps be reported to the same 
SDR as the original swap.
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    \84\ See DTCC letter at 2-3, appendix at 4, 21 (arguing that the 
Commission should adopt a ``single SDR'' rule to ensure that all of 
the data for a swap is available in one SDR.); ISDA letter at 44 
(contending that original and resulting swaps should be reported to 
the same SDR when a swap was executed without the intention or 
requirement to clear, but is subsequently cleared).
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    As noted above, proposed Sec.  45.3(j) would place the obligation 
to choose the SDR to which required swap creation data is reported on 
the registered entity or counterparty that is required to make the 
first report of required swap creation data pursuant to Sec.  45.3. 
Placing the obligation to choose the SDR on the registered entity or 
counterparty that is required to report the swap, rather than on 
another entity, should result in more efficient data reporting and 
promote market competition, while avoiding injecting a third party into 
the decision as to how a registered entity or counterparty fulfills its 
regulatory obligation to report initial required swap creation data. 
The registered entity or counterparty that is required to report may 
select an SDR to which its technological systems are most suited and/or 
to which it already has an established relationship, with existing 
technological protocols and procedures, providing for the efficient and 
accurate reporting of swap data. The Commission notes that under 
proposed Sec.  45.3(j), a registered entity or counterparty would not 
be precluded from choosing an SDR based on consideration of market 
preference or other factors; however, the obligation to choose the SDR 
will rest solely with the registered entity or counterparty enumerated 
therein. As discussed above, the Commission is proposing a number of 
requirements \85\ which should allow for the efficient and accurate 
linking of data where the original swap and clearing swaps are not 
reported to the same SDR.
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    \85\ See Section H, infra, discussing proposed additional PET 
data fields including: Clearing swap USIs, Clearing swap SDR, 
Original swap USI, and Original swap SDR. See also section C.2.iv. 
supra, discussing information required for continuation data for 
original swaps, including: (i) the LEI of the SDR to which each 
clearing swap for a particular original swap was reported by the DCO 
pursuant to new Sec.  45.3(e); (ii) the USI of the original swap 
that was replaced by the clearing swaps; and (iii) the USI for the 
clearing swaps that replace the original swap.
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    The Commission has included the following example to illustrate the 
application of proposed Sec.  45.10:
    Swap 1 is intended to be submitted to a DCO for clearing and 
executed on or pursuant to the rules of a SEF. The SEF reports all 
required creation data for such swap to registered SDR A pursuant to 
Sec.  45.3(a), selected by the SEF pursuant to Sec.  45.3(j)(1), and 
submits the swap to the DCO for clearing. Upon acceptance of Swap 1 for 
clearing, the DCO extinguishes Swap 1 and replaces it with Swap 2 and 
Swap 3, both of which are clearing swaps. Swap 1 is now an original 
swap.
    Under the proposal, Sec.  45.4(c) would require the DCO to report 
the termination of Swap 1 to SDR A,\86\ reflecting that Swap 1, now an 
original swap, has been terminated through clearing novation.\87\ The 
DCO would also report all required swap creation data for clearing Swap 
2 to a single SDR of its choice (say, for example, SDR B) pursuant to 
proposed Sec. Sec.  45.3(e) and (j)(2), and 45.10(d).\88\ Similarly, 
the DCO would be required to report all required swap creation data for 
clearing Swap 3 to a single SDR, in this case SDR B. Pursuant to 
proposed Sec.  45.10(d)(3), the DCO would be required to report all 
required swap creation data for clearing Swap 2 and clearing Swap 3 to 
the same SDR (SDR B) because Swap 2 and Swap 3 replaced Swap 1. 
Thereafter, proposed Sec.  45.10(d)(2) would require the DCO to report 
all required swap creation data and continuation data to the SDR where 
the first report of required swap creation data for both clearing Swap 
2 and clearing Swap 3 was made (SDR B).
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    \86\ Pursuant to proposed Sec.  45.10(a)(2), (b)(2), and (c)(3), 
continuation data for original swaps must be reported to the SDR 
where the first report of required swap creation data was made for 
the swap.
    \87\ Pursuant to existing Sec.  45.13(b), the DCO ``shall use 
the facilities, methods, or data standards provided or required by'' 
SDR A. 17 CFR 45.13(b).
    \88\ The Commission notes that pursuant to proposed Sec.  
45.10(a) through (d), the DCO in this example could select an SDR 
other than SDR A.
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    The requirements for DCOs demonstrated in the above example and 
contained in proposed Sec.  45.10(d)(1) and (2) are consistent with the 
existing requirements for SEFs, DCMs, and other reporting 
counterparties under current Sec.  45.10. By requiring that all swap 
data for each clearing swap be reported to a single SDR, proposed Sec.  
45.10(d)(1) and (2) further the Commission's stated purpose in creating 
Sec.  45.10, and part 45 generally, of reducing fragmentation of data 
for a given swap across multiple SDRs.\89\
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    \89\ See, e.g., 77 FR 2136, 2139, Jan. 13, 2012, (``To avoid 
fragmentation of data for a given swap across multiple SDRs, the 
[Notice of Proposed Rulemaking] [for part 45] would require that all 
data for a particular swap must be reported to the same SDR.''); at 
2143 (``First, in order to prevent fragmentation of data for a 
single swap across multiple SDRs, which would seriously impair the 
ability of the Commission and other regulators to view or aggregate 
all of the data concerning the swap, the proposed rule provided 
that, once an initial data report concerning a swap is made to an 
SDR, all data reported for that swap thereafter must be reported to 
the same SDR.''); and at 2168 (``The Commission believes the 
important regulatory purposes of the Dodd-Frank Act would be 
frustrated, and that regulators' ability to see necessary 
information concerning swaps could be impeded, if data concerning a 
given swap was spread over multiple SDRs.'').
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    The proposed requirement in Sec.  45.10(d)(3) that the DCO report 
to a single SDR all swap data for each clearing swap that can be traced 
back to the same original swap also supports the goal of avoiding 
fragmentation of swap data. Though clearing swaps are new individual 
swaps, all clearing swaps that issue from the same original swap are 
component parts of a cleared swap transaction. Fragmentation among 
clearing swaps would needlessly impair the ability of the Commission 
and other regulators to view or aggregate all the data concerning the 
related clearing swaps.
3. Request for Comment
    The Commission requests comment on all aspects of proposed new 
Sec.  45.10(d) and amended Sec.  45.10(a) through (c). The Commission 
also invites comments on the following:
    (30) Are the obligations assigned in the newly proposed and amended 
provisions of Sec.  45.10 sufficiently clear? If not, please explain 
how you believe they should be clarified.

G. Examples of Cleared Swap Reporting Workflows Under the Proposed 
Revisions

    The following examples demonstrate the manner in which the proposed 
rules would operate in hypothetical scenarios involving: (1) an off-
facility swap not subject to the clearing requirement with an SD/MSP 
reporting counterparty; and (2) a swap executed on or pursuant to the 
rules of a SEF or DCM. All references to part 45 appearing in the 
following examples refer to the rules as proposed in this release. 
These

[[Page 52557]]

examples are provided only for illustrative purposes to demonstrate the 
applicability of certain rules proposed in this release in hypothetical 
scenarios. The examples are not intended to dictate any aspect of 
compliance, reporting or other related processes and are not intended 
to cover all possible reporting circumstances.
1. Off-Facility Swap Not Subject to the Clearing Requirement With SD/
MSP Reporting Counterparty
    An off-facility swap that is not subject to the clearing 
requirement is executed with an SD reporting counterparty. The SD 
generates and assigns a USI for the swap pursuant to Sec.  45.5(b) and 
reports all required swap creation data for the swap to SDR A pursuant 
to Sec.  45.3(c). The SD submits the swap to a DCO for clearing and, 
pursuant to Sec.  45.10(b), transmits to the DCO, at the time the swap 
is submitted for clearing, the identity of SDR A and the USI for the 
swap.
    The DCO accepts the swap for clearing, extinguishing it and 
replacing it with clearing swaps; the swap that was submitted for 
clearing is now an original swap. The DCO generates and assigns a USI 
to each clearing swap pursuant to proposed Sec.  45.5(d) and, pursuant 
to the proposed amendments to Sec.  45.3(e), reports all required swap 
creation data for the clearing swaps, including the original swap 
USI,\90\ to SDR B, which the DCO in this example selected pursuant to 
proposed Sec.  45.3(j)(2).
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    \90\ Proposed modifications to appendix 1 would require that PET 
data include the original swap USI. See Proposed additions to 
appendix 1 to part 45, ``Additional Data categories and fields for 
clearing swaps.''
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    Pursuant to the proposed amendments to Sec.  45.4(c), the DCO would 
report continuation data for the original swap, including the original 
swap termination notice, to SDR A using either the life cycle or state 
data methods, and using the facilities, methods, or data standards 
provided or required by SDR A.\91\ In addition to all other necessary 
continuation data, original swap continuation data reported by the DCO, 
including the original swap termination notice, would also include: the 
LEI of SDR B (the SDR to which creation data for each clearing swap 
that replaced the particular original swap was reported);\92\ the USI 
of the original swap as transmitted to the DCO by the SD at the time 
the swap was submitted for clearing; and the USI for each clearing 
swap.
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    \91\ See 15 CFR 45.13(b).
    \92\ The Commission notes that the proposed Sec.  45.4(c)(2)(i) 
requirement that the DCO include the LEI of the SDR to which all 
required swap creation data for each clearing swap was reported by 
the DCO applies whether or not swap data for the original and 
clearing swaps is reported to the same SDR or to different SDRs. The 
Commission expects that this information will be useful for 
regulators with respect to their review of data pertaining to 
cleared swap transactions, and to SDRs with respect to their 
processing of swap data received, even when the original and 
clearing swaps reside in the same SDR.
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    The DCO would have no further continuation data reporting 
obligations with respect to the original swap thereafter. However, the 
Commission notes that pursuant to Sec.  45.14, registered entities and 
counterparties required to report swap data to an SDR must report any 
errors and omissions in the data reported.\93\ Additionally, non-
reporting counterparties are required to notify the reporting 
counterparty of such errors or omissions.\94\ Finally, pursuant to 
Sec.  49.10(a), SDR A would be required to accept and record any 
original swap continuation data, including the original swap 
termination.
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    \93\ While the DCO would have no additional continuation data 
reporting requirement with respect to the original swap after 
reporting the termination upon acceptance for clearing, the DCO 
remains obligated under Sec.  45.14 to correct errors and omissions 
in the data reported by the DCO, including the termination notice. 
For example, if a swap is submitted to, and accepted by, a DCO for 
clearing, the DCO would report the termination notice of the 
original swap to the SDR to which the creation data for the original 
swap was reported. After submission of the termination notice to the 
SDR, if the DCO should become aware of an error or omission in the 
termination notice, the DCO is required, pursuant to Sec.  45.14, to 
correct any errors and omissions in the data so reported as soon as 
is technologically practicable after discovery of such errors or 
omissions. Likewise, all reporting entities and swap counterparties 
also remain obligated under Sec.  45.14 to correct errors and 
omissions in all data reported by or on behalf of each entity and 
swap counterparty to an SDR.
    \94\ Pursuant to Sec.  45.14(b), if a counterparty to a swap 
that is not the reporting counterparty as determined by Sec.  45.8 
discovers any error or omission with respect to the continuation 
data, including termination notice of the original swap, such non-
reporting counterparty is required to notify the DCO of each such 
error or omission.
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2. Swaps Executed on or Pursuant to the Rules of a SEF or DCM
    A swap is executed on or pursuant to the rules of a SEF or DCM. The 
SEF/DCM generates and assigns a USI for the swap pursuant to Sec.  
45.5(a) and reports all required swap creation data to SDR A pursuant 
to Sec.  45.3(a). The SEF/DCM submits the swap to a DCO for clearing 
and, pursuant to Sec.  45.10(a), transmits to the DCO, at the time the 
swap is submitted for clearing, the identity of SDR A and the USI for 
the swap.
    The DCO accepts the swap for clearing, extinguishing it and 
replacing it with clearing swaps; the swap that was submitted for 
clearing is now an original swap. Under the proposed amendments to 
Sec. Sec.  45.5(d) and 45.3(e), the DCO would generate and assign a USI 
to each clearing swap and report all required swap creation data, 
including the original swap USI, for the clearing swaps to registered 
SDR A, which, in this example, the DCO selected pursuant to proposed 
Sec.  45.3(j)(2).\95\
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    \95\ Pursuant to 45.3(j)(2), the DCO could have selected SDR B.
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    Pursuant to the proposed amendments to Sec.  45.4(c), the DCO would 
report continuation data for the original swap, including the original 
swap termination notice, to SDR A using either the life cycle or state 
data methods, and using the facilities, methods, or data standards 
provided or required by SDR A. Such continuation data would include the 
LEI of SDR A (the SDR to which creation data for each clearing swap 
that replaced the particular original swap was reported), the USI of 
the original swap as transmitted to the DCO by the SEF/DCM at the time 
the swap was submitted for clearing, and the USI for each clearing 
swap.
    The DCO would have no further continuation data reporting 
obligations with respect to the original swap thereafter. However, the 
Commission notes that pursuant to Sec.  45.14, registered entities and 
counterparties required to report swap data to an SDR must report any 
errors and omissions in the data reported. Additionally, non-reporting 
counterparties are also required notify the reporting counterparty of 
such errors or omissions.\96\ Finally, pursuant to Sec.  49.10(a), SDR 
A would be required to accept and record the original swap termination.
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    \96\ See notes 93-94, supra.
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3. General Comments Received by the Commission Regarding the Approach 
Proposed in This Release
    As demonstrated by the examples above, the Commission is proposing 
an approach to the reporting of cleared swaps that would require 
reporting counterparties or SEFs/DCMs to report creation and 
continuation data for swaps commonly known as alphas, and that would 
require DCOs to report alpha swap terminations and swaps commonly known 
as beta and gamma swaps.
    A number of commenters suggested that part 45 should place swap 
data reporting obligations solely on DCOs, including with respect to 
swaps that are intended to be cleared at the time of execution and 
accepted for clearing by a DCO (alpha swaps) and swaps resulting from 
clearing (beta and gamma

[[Page 52558]]

swaps).\97\ However, one commenter noted that it would not be 
appropriate to require a DCO to report information related to the 
execution of an alpha swap.\98\
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    \97\ See CMC letter at 1, 3, 6 (noting that ``cleared swaps 
reporting should be handled exclusively by DCOs.''); NFPEA letter at 
12 (noting that ``If and when a swap is cleared and thereafter, all 
information about the swap should be reported to the SDR solely by 
the DCO''); EEI letter at 3, 14 (``The Commission should put all 
obligations for reporting cleared swaps on DCOs.''); ICE letter at 
3, 17 (stating that the DCO should be the sole reporting party for 
intended to be cleared swaps.); CEWG letter at 16 (``The Working 
Group recommends that the Part 45 regulations be amended to make 
clear that the DCO has the reporting obligations (creation and 
continuation data) for the original alpha swap and resulting 
positions . . .''); CME letter at 20 (contending that the act of 
submitting an intended to be cleared swap to a DCO should completely 
discharge the reporting obligations of each reporting counterparty, 
SEF or DCM, and that this position would be consistent with 
Congressional intent and would help ensure the Commission gets 
access to the best possible information for regulatory purposes 
without imposing unnecessary costs on the Commission or market 
participants).
    \98\ See LCH letter at 10 (``It would not be appropriate to 
oblige the DCO to enhance part 45 reporting in order to source 
information regarding the original execution that should be provided 
directly by the execution venue or execution counterparties.'').
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    The Commission understands that reporting counterparties and 
registered entities have invested substantial time and resources to 
report swaps to registered SDRs (whether or not such swaps are intended 
to be cleared at the time of execution) and that DCOs have invested 
substantial resources to report beta and gamma swaps that result from 
acceptance of a swap for clearing. Adopting the framework suggested by 
commenters above could result in a disruption of industry work flows 
and could require significant retooling of operational and 
technological solutions in place designed to report swap data, all at 
an additional cost to market participants.

H. Primary Economic Terms Data--Proposed Amendments to Appendix 1 to 
Part 45--Tables of Minimum Primary Economic Terms

    The Commission's current lists of minimum primary economic terms 
for swaps in each swap asset class are found in tables in Exhibits A-D 
of appendix 1 to part 45. Those tables include data elements that 
reflect generic economic terms and conditions common to most 
standardized products. They reflect the fact that PET data captures a 
swap's basic nature and essential economic terms, and are provided in 
order to ensure to the extent possible that most such essential terms 
are included when required primary economic terms are reported for each 
swap.
    The Commission is proposing the following revisions to Exhibits A 
through D of appendix 1, each of which is discussed in greater detail 
below: (1) modifications to existing PET data fields; (2) the addition 
of three new PET data fields applicable to all reporting entities for 
all swaps; and (3) the addition of a number of new data fields that 
must be reported by DCOs for clearing swaps.\99\
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    \99\ The Commission also proposes to revise each of the data 
categories and fields that reference the clearing requirement 
exception in CEA section 2(h)(7) to reflect that exceptions to, and 
exemptions from, the clearing requirement, including the clearing 
requirement exception in CEA section 2(h)(7), are set forth under 
part 50 of the Commission's regulations.
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    i. Proposed Modifications to Existing PET Data Fields
    The Commission proposes clarifying and conforming changes and minor 
corrective modifications to the following existing PET data fields:
     The Unique Swap Identifier for the swap--The Commission is 
proposing to remove the explanatory note in the Comment section to this 
data field in Exhibits A-D. The explanatory note is no longer necessary 
because under proposed Sec.  45.5(d), the DCO would create the USI for 
each clearing swap.
     PET data fields that utilize a legal entity identifier 
\100\--The Commission is proposing conforming changes to the Comment 
sections to data fields in Exhibits A-D that utilize the LEI to reflect 
that the CFTC has designated an LEI system\101\ and to reflect that a 
substitute identifier may be reported for natural person swap 
counterparties.
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    \100\ These include the following fields in Exhibits A through 
D: The Legal Entity Identifier of the reporting counterparty; If the 
swap will be allocated, or is a post-allocation swap, the Legal 
Entity Identifier of the agent; The Legal Entity Identifier of the 
non-reporting party; Clearing venue; The identity of the 
counterparty electing an exception or exemption to the clearing 
requirement under part 50 of this chapter (formerly The identity of 
the counterparty electing the clearing requirement exception in CEA 
section 2(h)(7)); Exhibit A: An indication of the counterparty 
purchasing protection; An indication of the counterparty selling 
protection; Information identifying the reference entity; Exhibit D: 
Buyer, Seller.
    \101\ The explanatory notes discussing a situation where no CFTC 
designated LEI is yet available are no longer applicable. See 
generally ``Order Extending the Designation of the Provider of Legal 
Entity Identifiers To Be Used in Recordkeeping and Swap Data 
Reporting Pursuant to the Commission's Regulations,'' 80 FR 44078, 
Jul. 24, 2015.
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     If no CFTC-approved Legal Entity Identifier for the non-
reporting counterparty is yet available, the internal identifier for 
the non-reporting counterparty used by the swap data repository--The 
Commission is also proposing to remove this data field in each of the 
Exhibits. As noted above, the CFTC has designated an LEI, and these PET 
data fields are no longer applicable.
     For a mixed swap reported to two non-dually-registered 
swap data repositories, the identity of the other swap data repository 
(if any) to which the swap is or will be reported--The Commission is 
proposing to add an explanatory note to the Comment section for this 
data field in Exhibits A-D providing that the field value is the LEI of 
the other SDR to which the swap is or will be reported.
     Block trade indicator--The Commission is proposing to 
modify the Comment section to this data field in Exhibits A-D to 
reflect that the CFTC has issued a final rulemaking regarding 
Procedures To Establish Appropriate Minimum Block Sizes for Large 
Notional Off-Facility Swaps and Block Trades.\102\
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    \102\ See generally ``Procedures To Establish Appropriate 
Minimum Block Sizes for Large Notional Off-Facility Swaps and Block 
Trades,'' 78 FR 32866, May 31, 2013.
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     Execution venue--The Commission is proposing to modify the 
explanatory note in the Comment section to this data field in Exhibits 
A-D to reflect that the CFTC has designated an LEI system and to 
require the reporting of only the LEI of the SEF or DCM for swaps 
executed on or pursuant to the rules of a SEF or DCM.
     Clearing indicator--The Commission is proposing 
modifications to the explanatory note in the Comment section to this 
data field in Exhibits A through D to provide for the reporting of a 
Yes/No indication of whether the swap will be submitted for clearing to 
a DCO.
     Clearing venue--The Commission is proposing modifications 
to the Comment section of this data field in Exhibits A-D to provide 
for the reporting of only the LEI of the derivatives clearing 
organization.
ii. Proposed Addition of New PET Data Fields Applicable to All 
Reporting Entities for All Swaps
    The Commission proposes to add to Exhibits A-D the following new 
PET fields which would be applicable to all reporting entities for all 
swaps:
     Asset class--This data field would provide the specific 
asset class for the swap. Field values: credit, equity, FX, rates and 
other commodity.
     An indication of whether the reporting counterparty is a 
derivatives clearing organization with respect to the swap.
     Clearing exception or exemption type--This field would 
provide the type

[[Page 52559]]

of clearing exception or exemption being claimed. Field values: End 
user, Inter-affiliate or Cooperative.
    The asset class data field will assist the Commission in 
identifying the asset class for swaps reported to registered SDRs 
pursuant to part 45. The indication of whether the reporting 
counterparty is a DCO with respect to the swap data field is consistent 
with proposed Sec.  45.8(i), which designates the DCO as the reporting 
counterparty for clearing swaps, and the existing PET data fields that 
require certain information related to the registration status of the 
counterparties to be included in PET data reporting. The clearing 
exception or exemption types data field will provide information with 
respect to the specific exception or exemption from the clearing 
requirement that is being elected for the swap.\103\
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    \103\ As noted above, in addition to the end-user exception to 
the swap clearing requirement set forth in section 2(h)(7) of the 
CEA and codified in part 50 of the Commission's regulations, the 
Commission has published two exemptions to the swap clearing 
requirement: the inter-affiliate exemption (Sec.  50.52) and the 
financial cooperative exemption (Sec.  50.51).
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iii. Proposed Addition of New PET Data Fields Applicable to DCOs for 
Clearing Swaps
    The Commission also proposes to modify Exhibits A-D in order to add 
new PET fields specifically to be reported by DCOs for clearing swaps. 
The proposed fields, which would be placed under the heading 
``Additional Data Categories and Fields for Clearing Swaps'' in each 
table included as Exhibits A-D, would more accurately capture the 
additional, unique features of clearing swaps that are not relevant to 
uncleared swaps. The newly proposed data fields that must be reported 
by DCOs for clearing swaps include the following:
     Clearing swap USIs--This data field would provide the USI 
for each clearing swap that replaces the original swap, other than the 
USI for which the PET data is currently being reported.
     Original swap USI--This data field would provide the USI 
for the original swap that was replaced by clearing swaps.\104\
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    \104\ See also Sec.  45.10(a)(1), (b)(1)(iii), (b)(2)(ii), 
(c)(1)(iii), (c)(2)(ii), and (c)(3) (requiring entities with 
reporting obligations to transmit to the DCO for swaps submitted for 
clearing ``the identity of the swap data repository to which 
required swap creation data is reported'' and the USI for the swap).
---------------------------------------------------------------------------

     Original swap SDR--This data field would provide the LEI 
of the SDR to which the original swap was reported.\105\
---------------------------------------------------------------------------

    \105\ Id.
---------------------------------------------------------------------------

     Clearing member LEI--This data field would provide the LEI 
of the clearing member.
     Clearing member client account--This data field would 
provide the account number for the client, if applicable, of the 
clearing member.
     Origin (house or customer)--This data field would provide 
information regarding whether the clearing member acted as principal 
for a house trade or agent for a customer trade.
     Clearing Receipt Timestamp--This data field would provide 
the date and time at which the DCO received the original swap that was 
submitted for clearing.
     Clearing Acceptance Timestamp--This data field would 
provide the date and time at which the DCO accepted the original swap 
that was submitted for clearing.
    Some commenters argued that the Commission should not require 
additional data fields for reporting and should reduce the number of 
fields currently required.\106\ The Commission is of the view that the 
proposed modifications to existing PET data fields will add clarity to 
the current reporting requirements and, in regards to the additional 
fields, will require the reporting of information that is essential to 
the efficient operation of reporting of the swaps involved in a cleared 
swap transaction.
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    \106\ See CMC letter at 3 (recommending that the Commission 
reduce the number and complexity of data fields required to improve 
data reporting); CME letter at 17-19 (providing recommendations on 
modification for specific data fields and arguing against requiring 
certain additional reporting); DTCC letter at 3, appendix at 15 
(suggesting that the Commission consider whether requiring fewer 
data elements would better enable the Commission and other 
regulators to fulfill their regulatory obligations); International 
Energy Credit Association letter at 5-6 (arguing that existing swap 
data reporting requirements do not need to be expanded and that data 
reporting would be improved by reducing the current reporting 
burden); Swiss Re letter at 5 (describing reporting difficulties for 
specific data fields).
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3. Request for Comment
    The Commission requests comment on all aspects of the proposed 
revisions to the PET data tables found in appendix 1 to part 45 and the 
proposed ``Additional Data Categories and Fields for Clearing Swaps.'' 
The Commission also invites comments on the following:
    (31) Are there additional data categories and fields for clearing 
swaps which are necessary to understand a clearing swap and/or the 
mechanics of the clearing process? If so, please describe such 
additional data categories and fields.
    (32) Will reporting any of the new or revised data categories and 
fields result in any operational or technological challenges? If so, 
please explain.
    (33) Are there other entities, in addition to those currently 
required to be identified in swap data reporting, that may play some 
part in the execution or reporting of a cleared swap transaction? If 
so, what are they? Should their identifying information be reported to 
a registered SDR as an element of PET data?
    (34) Are the newly proposed and revised PET data fields included in 
appendix 1, including the PET data therein, sufficiently clear? If not, 
please explain.

III. Request for Comments

    The Commission requests comments concerning all aspects of the 
proposed regulations, including, without limitation, all of the aspects 
of the proposed regulations on which comments have been requested 
specifically herein. The Commission also invites comments on the 
following:
    (35) Please identify any challenges that might result from any 
differences between the Commission's and the SEC's respective proposals 
for treatment of cleared swap transactions.
    (36) Are there differences between the Commission's and the SEC's 
respective proposals for the reporting of cleared swap transactions 
that should be harmonized? If so, please explain.
    (37) Based upon the proposed modifications to the swap data 
reporting provisions of part 45, do commenters believe that associated 
modifications are necessary to the recordkeeping provisions of Sec.  
45.2?
    (38) In practice, would DCOs employ agents for reporting clearing 
swaps to an SDR? Please explain any ways you believe the proposed 
regulations should be modified to facilitate a DCO's ability to employ 
agents to report clearing swaps.
    (39) Please describe the nature of any changes necessary, i.e., 
operational, technological, administrative, etc., for SEFs, DCMs and 
reporting counterparties to comply with the rules proposed in the 
release, and the length of time needed to implement each type of 
change.
    (40) Do the proposed amendments and additions to part 45 adequately 
address the reporting of swap transaction data for both the principal 
and agency clearing models? If not, please explain.
    (41) Do commenters believe that additional revisions are necessary 
to part 45 to accurately and timely report any other type of swap 
transaction data for clearing transactions? If so, please explain.

[[Page 52560]]

IV. Related Matters

A. Regulatory Flexibility Act

    The Regulatory Flexibility Act (``RFA'') requires federal agencies, 
in promulgating rules, to consider the impact of those rules on small 
entities.\107\ The rules proposed herein will have a direct effect on 
SDRs, DCOs, SEFs, DCMs, SDs, MSPs, and non-SD/MSP counterparties who 
are counterparties to one or more swaps and subject to the Commission's 
jurisdiction. The Commission has previously established certain 
definitions of ``small entities'' to be used by the Commission in 
evaluating the impact of its rules on small entities in accordance with 
the RFA.\108\ The Commission has previously determined that DCMs\109\ 
and DCOs\110\ are not small entities for the purpose of the RFA. The 
Commission has also previously proposed that SDRs, SEFs, SDs, and MSPs 
should not be considered to be small entities.\111\
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    \107\ See 5 U.S.C. 601 et seq.
    \108\ 47 FR 18618, 18618-21, Apr. 30, 1982.
    \109\ Id.
    \110\ 66 FR 45604, 45609, Aug. 29, 2001.
    \111\ 75 FR 76574, 76595, Dec. 8, 2010 (The Notice of Proposed 
Rulemaking for 17 CFR part 45 describes why SDRs, SEFs, SDs, and 
MSPs should not be considered small entities).
---------------------------------------------------------------------------

    The Final Part 45 Rulemaking and preceding proposal discussed how 
certain non-SD/MSP counterparties could be considered small entities in 
certain limited situations, but concluded that part 45 does not have a 
significant impact on a substantial number of small entities.\112\ The 
modifications to part 45 proposed herein do not modify that conclusion, 
or the reasoning behind it, and therefore the Commission does not 
believe that these proposed rules will have a significant economic 
impact on a substantial number of small entities.
---------------------------------------------------------------------------

    \112\ 77 FR 2136, 2170-71, Jan. 13, 2012 (The Final Part 45 
Rulemaking discussion for non-SD/MSP counterparties); 75 FR at 
76595, Dec. 8, 2010, (The part 45 Notice of Proposed Rulemaking 
discussion for non-SD/MSP counterparties).
---------------------------------------------------------------------------

    Therefore, the Chairman, on behalf of the Commission, pursuant to 5 
U.S.C. 605(b), hereby certifies that the proposed rules will not have a 
significant economic impact on a substantial number of small entities.

B. Paperwork Reduction Act

    The purposes of the Paperwork Reduction Act of 1995, 44 U.S.C. 3501 
et seq. (``PRA'') are, among other things, to minimize the paperwork 
burden to the private sector, to ensure that any collection of 
information by a government agency is put to the greatest possible 
uses, and to minimize duplicative information collections across the 
government.\113\ The PRA applies to all information, ``regardless of 
form or format,'' whenever the government is ``obtaining, causing to be 
obtained, [or] soliciting'' information, and includes required 
``disclosure to third parties or the public, of facts or opinions,'' 
when the information collection calls for ``answers to identical 
questions posed to, or identical reporting or recordkeeping 
requirements imposed on, ten or more persons.'' \114\ The PRA 
requirements have been determined to include not only mandatory but 
also voluntary information collections, and include both written and 
oral communications.\115\ Under the PRA, an agency may not conduct or 
sponsor, and a person is not required to respond to, a collection of 
information unless it displays a currently valid control number from 
the Office of Management and Budget (``OMB''). The OMB control number 
of this information collection is 3038-0089.
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    \113\ See 44 U.S.C. 3501.
    \114\ See 44 U.S.C. 3502.
    \115\ See 5 CFR 1320.3(c)(1).
---------------------------------------------------------------------------

    The Commission is not seeking to amend information collection 3038-
0089 because the Commission believes that the rule modifications 
proposed herein will not impose any new information collection 
requirements that require approval from OMB under the PRA. The proposed 
amendments may necessitate changes to market participants' and 
registered entities' reporting systems, but burdens for the maintenance 
and utilization of reporting functionality are already included in the 
approved information collection.\116\ Any necessary changes to 
reporting functionality will not increase the existing annual burden 
calculated for a market participant or registered entity to ``oversee, 
maintain, and utilize the reporting functionality.'' \117\ Changes to 
the data reported pursuant to the proposed amendments, whether in the 
form of additional data fields or the shifting of reporting 
responsibilities, also do not impose any new collection of information 
because, as noted in the original publication of part 45, reporting 
pursuant to this part is largely automatic and electronic, which limits 
the burden of reporting to the hours and cost required in maintaining 
and utilizing an entity's reporting functionality.\118\
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    \116\ See 77 FR 2136, 2171-2176, Jan. 13, 2012.
    \117\ See 77 FR at 2174, Jan. 13, 2012.
    \118\ See 77 FR at 2174 (``The Commission anticipates that the 
reporting required by Sec. Sec.  45.3 and 45.4 will to a significant 
extent be automatically completed by electronic computer systems; 
the following burden hours are calculated based on the annual burden 
hours necessary to oversee, maintain, and utilize the reporting 
functionality.'').
---------------------------------------------------------------------------

    Additionally, though the proposed rules clarify the 
responsibilities of certain entities under part 45 where the 
responsibilities were not explicitly assigned in the original rule, the 
relevant entities were included in the PRA calculation for the original 
rule, meaning that explicitly assigning the responsibilities now does 
not create a burden that is not already included in information 
collection 3038-0089. Further, the proposed changes, especially in the 
context of swap data reporting, could also affect burdens that are 
included in the burdens calculated for part 43 of the Commission's 
regulations and, as described in the original publication of part 45, 
any cost or burden created by the proposed changes should not be 
considered additional to the burdens already calculated for part 43, as 
applicable.\119\ To the extent that this rulemaking contains provisions 
that would qualify as collections of information for which the 
Commission has already sought and obtained a control number from OMB, 
the burden hours associated with those provisions are not replicated 
here, as the Commission is obligated to account for PRA burden once and 
the PRA encourages multiple applications of a single collection.\120\ 
Therefore, these proposed amendments to part 45 do not, by themselves, 
impose any new information collection requirements other than those 
that already exist in parts 43 and 45 of the Commission's regulations.
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    \119\ See id. (``The Commission notes, however, that these 
burdens should not be considered additional to the costs of 
compliance with part 43, because the basic data reporting 
technology, processes, and personnel hours and expertise needed to 
fulfill the requirements of part 43 encompass both the data stream 
necessary for real-time public reporting and the creation data 
stream necessary for regulatory reporting.'').
    \120\ See 44 U.S.C. 3501(2) and (3).
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    The Commission specifically invites public comment on the accuracy 
of its estimate that no additional information collection requirements 
or changes to existing collection requirements would result from this 
proposal.
Information Collection Comments
    The Commission invites the public and other Federal agencies to 
comment on any aspect of the proposed information collection 
requirements discussed above. The Commission will consider public 
comments on this proposed collection of information in:
    (1) Evaluating whether the proposed collection of information is 
necessary for the proper performance of the

[[Page 52561]]

functions of the Commission, including whether the information will 
have a practical use;
    (2) Evaluating the accuracy of the estimated burden of the proposed 
collection of information, including the degree to which the 
methodology and the assumptions that the Commission employed were 
valid;
    (3) Enhancing the quality, utility, and clarity of the information 
proposed to be collected; and
    (4) Minimizing the burden of the proposed information collection 
requirements on derivatives clearing organizations, designated contract 
markets, and swap execution facilities, including through the use of 
appropriate automated, electronic, mechanical, or other technological 
information collection techniques, e.g., permitting electronic 
submission of responses.
    Copies of the submission from the Commission to OMB are available 
from the CFTC Clearance Officer, 1155 21st Street NW., Washington, DC 
20581, (202) 418-5160 or from http://RegInfo.gov. Organizations and 
individuals desiring to submit comments on the proposed information 
collection requirements should send those comments to:
     The Office of Information and Regulatory Affairs, Office 
of Management and Budget, Room 10235, New Executive Office Building, 
Washington, DC 20503, Attn: Desk Officer of the Commodity Futures 
Trading Commission;
     (202) 395-6566 (fax); or
     [email protected] (email).
    Please provide the Commission with a copy of submitted comments so 
that all comments can be summarized and addressed in the final 
rulemaking, and please refer to the ADDRESSES section of this 
rulemaking for instructions on submitting comments to the Commission. 
OMB is required to make a decision concerning the proposed information 
collection requirements between 30 and 60 days after publication of 
this release in the Federal Register. Therefore, a comment to OMB is 
best assured of receiving full consideration if OMB receives it within 
30 calendar days of publication of this release. Nothing in the 
foregoing affects the deadline enumerated above for public comment to 
the Commission on the proposed rules.

C. Cost-Benefit Considerations

1. Introduction
    Section 15(a) of the CEA requires the Commission to consider the 
costs and benefits of its actions before promulgating a regulation 
under the CEA or issuing certain orders.\121\ Section 15(a) further 
specifies that the costs and benefits shall be evaluated in light of 
five broad areas of market and public concern: (1) Protection of market 
participants and the public; (2) efficiency, competitiveness, and 
financial integrity of futures markets; (3) price discovery; (4) sound 
risk management practices; and (5) other public interest 
considerations. The Commission considers the costs and benefits 
resulting from its discretionary determinations with respect to the 
section 15(a) factors.
---------------------------------------------------------------------------

    \121\ 7 U.S.C. 19(a).
---------------------------------------------------------------------------

    The Commission is proposing revisions and additions to Sec. Sec.  
45.1, 45.3, 45.4, 45.5, 45.8, 45.10, and appendix 1 to part 45 in order 
to provide clarity to counterparties to a swap and registered entities 
regarding their part 45 reporting obligations with respect to cleared 
swap transactions and to improve the efficiency of data collection and 
maintenance associated with the reporting of the swaps involved in a 
cleared swap transaction.
2. Background
    The swap data reporting framework adopted in the Final Part 45 
Rulemaking \122\ was largely based on the mechanisms for the trading 
and execution of uncleared swaps. The plain language of the existing 
part 45 rules presumes the existence of a single, continuous swap both 
prior to and after acceptance of a swap for clearing by a DCO. Under 
that framework, registered entities and counterparties would each 
report data with respect to a single swap when such swap is initially 
executed, referred to as ``creation data,'' and over the course of the 
swap's existence, referred to as ``continuation data.'' \123\
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    \122\ See ``Swap Data Recordkeeping and Reporting 
Requirements,'' 77 FR 2136, Jan. 13, 2012.
    \123\ Section 45.1 defines ``required swap creation data'' as 
primary economic terms data and confirmation data. Section 45.1 
defines ``primary economic terms data'' as ``all of the data 
elements necessary to fully report all of the primary economic terms 
of a swap in the swap asset class of the swap in question'' and 
defines ``confirmation data'' as ``all of the terms of a swap 
matched and agreed upon by the counterparties in confirming the 
swap. For cleared swaps, confirmation data also includes the 
internal identifiers assigned by the automated systems of the 
derivatives clearing organization to the two transactions resulting 
from novation to the clearing house.'' 17 CFR 45.1.
---------------------------------------------------------------------------

    The Commission has since had additional opportunities to consult 
with industry and with other regulators, including the Securities and 
Exchange Commission (``SEC''),\124\ and to observe how the part 45 
regulations function in practice with respect to swaps that are 
cleared, including how the implementation of part 45 interacts with the 
implementation of part 39 of the Commission's regulations, which 
contains provisions applicable to DCOs.
---------------------------------------------------------------------------

    \124\ The SEC proposed certain new rules and rule amendments to 
Regulation SBSR governing reporting in the context of security-based 
swaps. See ``Regulation SBSR--Reporting and Dissemination of 
Security-Based Swap Information,'' 80 FR 14740, Mar. 19, 2015.
---------------------------------------------------------------------------

    In particular, Sec.  39.12(b)(6) provides that upon acceptance of a 
swap by a DCO for clearing, the original swap is extinguished and 
replaced by equal and opposite swaps, with the DCO as the counterparty 
to each such swap.\125\ The original swap that is extinguished upon 
acceptance for clearing is commonly referred to as the ``alpha'' swap 
and the equal and opposite swaps that replace the original swap are 
commonly referred to as ``beta'' and ``gamma'' swaps. The Commission is 
of the view that the existing part 45 regulations could be amended to 
better accommodate the multi-swap framework of Sec.  39.12(b)(6) by 
explicitly addressing beta and gamma swaps as distinct swaps for 
purposes of part 45 reporting.\126\
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    \125\ See 17 CFR 39.12(b)(6) (requiring a DCO that clears swaps 
to ``have rules providing that, upon acceptance of a swap by the 
[DCO] for clearing: (i) the original swap is extinguished; (ii) the 
original swap is replaced by an equal and opposite swap between the 
[DCO] and each clearing member acting as principal for a house 
trading or acting as agent for a customer trade . . .''). Subsequent 
to adoption of the Final Part 45 Rulemaking, the Commission affirmed 
that the multi-swap framework (comprising separate and unique 
original and resulting swaps) should apply for part 45 reporting 
purposes. See Statement of the Commission on the Approval of Chicago 
Mercantile Exchange Rule 1001 at 6, Mar. 6, 2013, available at 
http://www.cftc.gov/ucm/groups/public/@newsroom/documents/file/statementofthecommission.pdf.
    \126\ The Commission also notes that a single swap reporting 
framework for cleared swaps, as opposed to a multi-swap framework 
like the one contemplated by Sec.  39.12(b)(6), would likely not be 
consistent with the approach proposed by the SEC in its release 
proposing certain new rules and rule amendments to Regulation SBSR. 
See ``Regulation SBSR--Reporting and Dissemination of Security-Based 
Swap Information,'' 80 FR 14740, Mar. 19, 2015. The Commission 
discusses the benefits associated with harmonizing its approach with 
that of other regulators later in this release.
---------------------------------------------------------------------------

    The existing part 45 regulations do not explicitly reflect industry 
practice, which the Commission understands is to generally report part 
45 data for cleared swap transactions in conformance with the framework 
described in Sec.  39.12(b)(6), where separate swaps (alphas, betas, 
and gammas) are represented individually in reported swap data. The 
Commission understands that under existing market practice: SEFs, DCMs 
and reporting counterparties generally report required swap creation 
data for alpha swaps to the SDR of their choice; DCOs that

[[Page 52562]]

accept alpha swaps for clearing generally report required swap creation 
data for the beta and gamma swaps that result from clearing novation of 
the alpha swap to the SDR of their choice (which may be different than 
the SDR to which the alpha swap was reported); such DCOs do not in all 
cases include the USI of the alpha swap in creation data reported for 
the beta and gamma swaps; and that DCOs may inconsistently report, and 
SDRs may inconsistently accept and process, alpha swap 
terminations.\127\
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    \127\ While the above reflects the Commission's general 
understanding of industry practice with respect to the reporting of 
component parts of a cleared swap transaction, the Commission does 
not possess complete information regarding certain details and 
nuances of the reporting practices of different registered entities 
and reporting counterparties. For instance, in some cases, the 
Commission generally does not possess sufficient information to 
ascertain the period of time between the DCO's acceptance of an 
alpha swap for clearing and the DCO's report of creation data for 
beta and gamma swaps. Questions eliciting specific details or 
nuances of industry practice that are likely to have cost/benefit 
implications are posed in the relevant sections discussing the costs 
and benefits of each proposed amendment or addition below.
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    The gaps between the existing part 45 regulations, Sec.  
39.12(b)(6), and certain industry practices, including those outlined 
above, have likely contributed to a lack of certainty regarding the 
applicability of the part 45 regulations to beta and gamma swaps, 
including which registered entity or counterparty is required to report 
creation data and/or continuation data for such swaps, and the manner 
in which such swaps must be reported. The Commission understands that 
this uncertainty presents compliance challenges for registered entities 
and reporting counterparties.
    Additionally, the lack of clarity regarding existing part 45 
obligations with respect to beta and gamma swaps has impacted the 
accuracy, quality, and usefulness of data that is reported for cleared 
swaps. For instance, inconsistent DCO reporting of alpha swap USIs in 
creation data for beta and gamma swaps hinders the Commission's ability 
to trace the history of a cleared swap transaction from execution 
between the original counterparties to clearing novation. Even in cases 
where the Commission can ascertain the USI of a specific alpha swap 
that was replaced by beta and gamma swaps, SDR data available to the 
Commission at times misleadingly shows some alpha swaps as remaining 
open between the original counterparties, when in actuality such swaps 
have been extinguished through clearing novation. An inability to 
determine whether an alpha swap has been terminated impedes the 
Commission's ability to analyze cleared swap activity and to review 
swap activity for compliance with the clearing requirement. Situations 
where alpha swaps that have been terminated that appear to remain open 
create a risk of double counting swap notional exposures and would 
impede the Commission's ability to analyze and study swaps market 
activity using accurate information. The inability to link the 
different swaps in a cleared swap transaction also impedes the 
Commission's ability to assess exposures of market participants in the 
uncleared and cleared swaps markets. Additionally, certain creation 
data fields that are currently populated for beta and gamma swaps prove 
difficult to interpret, and thus can result in inconsistencies in their 
application and reporting among alpha, beta, and gamma swaps, hindering 
the Commission's ability to interpret and analyze data regarding beta 
and gamma swaps.
    The revisions and additions proposed in this release would amend 
part 45 so that it differentiates reporting requirements for cleared 
and uncleared swap transactions, and so that it explicitly addresses 
swap counterparty and registered entity reporting requirements for each 
component (e.g., alpha, beta, and gamma) of a cleared swap transaction. 
This proposal will remove uncertainty as to which counterparty to a 
swap is responsible for reporting creation data for each of the various 
components of a cleared swap transaction. The proposal will also make 
clear whose obligation it is to report the extinguishment of the 
original swap upon acceptance of a swap by a DCO for clearing. These 
additional details will include where, when, and how to report the swap 
data pertaining to the establishment of the beta and gamma swaps and 
the reporting of the termination message to the SDR that originally 
received the swap data for the alpha swap. This proposal is also 
intended to improve the efficiency of data collection and maintenance 
associated with the reporting of the swaps involved in a cleared swap 
transaction and to improve the accuracy, quality, and usefulness of 
data that is reported for cleared swaps and alpha swaps that have been 
extinguished due to clearing novation.
    The Commission believes that the baseline for this consideration of 
costs and benefits is generally the existing part 45 regulations, which 
were adopted in 2011.\128\ However, as described above, in certain 
circumstances, industry practice has been informed by certain 
provisions of part 39 and by subsequent industry developments, and thus 
does not necessarily reflect the plain language of the existing part 45 
regulations. In those circumstances, the baseline for this 
consideration of costs and benefits will be industry practice.
---------------------------------------------------------------------------

    \128\ See ``Swap Data Recordkeeping and Reporting 
Requirements,'' 77 FR 2136, Jan. 13, 2012.
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    The following consideration of costs and benefits is organized 
according to the rules and rule amendments proposed in this release. 
For each rule, the Commission summarizes the proposed amendments \129\ 
and identifies and discusses the costs and benefits attributable to 
them, including costs and benefits raised by commenters in response to 
the Commission's 2014 request for comment regarding swap data 
recordkeeping and reporting requirements.\130\ The Commission then 
considers the costs and benefits of certain alternatives to the rules 
proposed in this release, as well as the costs and benefits of all of 
the proposed rules jointly in light of the five public interest 
considerations set out in section 15(a) of the CEA.
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    \129\ As described in detail throughout Section II of this 
release, the Commission is also proposing a number of non-
substantive, conforming rule amendments in this release, such as 
renumbering certain provisions and modifying the wording of existing 
provisions to ensure consistency with the wording in newly proposed 
definitions. Non-substantive amendments of this nature will not be 
discussed in the cost-benefit portion of this release.
    \130\ See ``Review of Swap Data Recordkeeping and Reporting 
Requirements,'' Request for Comment, 79 FR 16689, Mar. 26, 2014.
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    The Commission notes that this consideration of costs and benefits 
is based on the understanding that the swaps market functions 
internationally, with many transactions involving U.S. firms taking 
place across international boundaries, with some Commission registrants 
being organized outside of the United States, with leading industry 
members typically conducting operations both within and outside the 
United States, and with industry members commonly following 
substantially similar business practices wherever located. Where the 
Commission does not specifically refer to matters of location, the 
below discussion of costs and benefits refers to the effects of the 
proposed rules on all swaps activity subject to the proposed and 
amended regulations, whether by virtue of the activity's physical 
location in the United States or by virtue of the activity's connection 
with or effect on U.S. commerce under CEA section 2(i).\131\ The 
Commission also notes that

[[Page 52563]]

the existing part 45 regulations generally contemplate situations where 
a swap may be required to be reported pursuant to U.S. law and the law 
of another jurisdiction.\132\
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    \131\ 7 U.S.C. 2(i). Section 2(i)(1) makes the swaps provisions 
of the Dodd-Frank Act, and Commission regulations promulgated under 
those provisions, applicable to activities outside the United States 
that ``have a direct and significant connection activities in, or 
effect on, commerce of the United States;'' while section 2(i)(2) 
makes them applicable to activities outside the United States that 
contravene Commission rules promulgated to prevent evasion of Dodd-
Frank. Application of section 2(i)(1) to the existing part 45 
regulations with respect to SDs/MSPs and non-SD/non-MSP 
counterparties is discussed in the Commission's non-binding 
Interpretive Guidance and Policy Statement Regarding Compliance With 
Certain Swap Regulations, 78 FR 45292 (July 26, 2013).
    \132\ See 17 CFR 45.1 (defining ``International swap'' to mean 
``a swap required by U.S. law and the law of another jurisdiction to 
be reported both to a swap data repository and to a different trade 
repository registered with the other jurisdiction.''); see also 17 
CFR 45.3(h) (prescribing requirements with respect to international 
swaps).
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3. Definitions--Proposed Amendments to Sec.  45.1
    Proposed amendments to Sec.  45.1 would revise the definition of 
``derivatives clearing organization'' for purposes of part 45 to update 
a reference to an existing definition of ``derivatives clearing 
organization'' and to make clear that part 45 applies to DCOs 
registered with the Commission. Proposed amendments to Sec.  45.1 would 
also add new definitions for ``original swaps'' (swaps that have been 
accepted for clearing by a DCO, commonly referred to as ``alpha'' 
swaps) and ``clearing swaps'' (swaps created pursuant to the rules of a 
DCO that have a DCO as a counterparty, including, but not limited to, 
any swap that replaces an original swap that was extinguished upon 
acceptance for clearing, commonly referred to as ``beta'' and ``gamma'' 
swaps).
    These proposed terms would be used throughout part 45 to help 
clarify reporting obligations for each swap involved in a cleared swap 
transaction. The Commission will use the defined terms ``original 
swaps'' and ``clearing swaps'' throughout this consideration of costs 
and benefits when discussing the future applicability of the rules 
proposed in this release to the particular components of a cleared swap 
transaction. Given that these terms are a product of this release and 
are not yet part of industry nomenclature, the Commission will also use 
the terms ``alpha, beta, and gamma'' throughout this consideration of 
costs and benefits when discussing existing industry practice and when 
helpful for purposes of clarification.\133\
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    \133\ The Commission determined to utilize the proposed to be 
defined terms ``original swap'' and ``clearing swaps'' in this 
release rather than the industry terms ``alpha, beta, and gamma'' 
because while a cleared-swap transaction generally comprises an 
original swap that is terminated upon novation and the equal and 
opposite swaps that replace it, the Commission is aware of certain 
circumstances in which a cleared swap transaction may not involve 
the replacement of an original swap (e.g., an open offer swap, as 
discussed earlier in this release). See note 30, supra.
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i. Costs
    The Commission does not anticipate that these proposed definitions, 
in and of themselves, would impose additional costs on DCOs or market 
participants. However, these proposed definitions will be referenced in 
other proposed substantive provisions. The costs and benefits of those 
substantive requirements will be discussed in the relevant sections 
below.
ii. Benefits
    As discussed earlier in this release, the plain language of the 
existing part 45 regulations presumes the existence of one continuous 
swap and does not explicitly acknowledge distinct reporting 
requirements for the individual components (i.e., alphas, betas, and 
gammas) of a cleared swap transaction. However, industry practice is 
generally to report part 45 data for cleared swap transactions in 
conformance with the multi-swap framework described in Sec.  
39.12(b)(6) (i.e., to report alphas, betas, and gammas separately). The 
definitions of original and clearing swaps, along with the other 
revisions to part 45 proposed in this release, would help align the 
part 45 regulations with part 39 and with certain industry practices 
and would explicitly delineate the swap data reporting obligations 
associated with each of the swaps involved in a cleared swap 
transaction.\134\
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    \134\ The Commission acknowledges that the alternative 
approaches to the reporting of cleared swap transactions separately 
discussed in the Consideration of Alternatives section later in this 
release could also provide these benefits for registered entities 
and swap counterparties. However, for the reasons explained in that 
section, the Commission is of the view that the proposed approach is 
more consistent with industry practice than the alternatives.
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4. Creation Data Reporting by Derivatives Clearing Organizations--
Proposed Amendments to Sec.  45.3
    Currently, Sec.  45.3 requires reporting to an SDR of two types of 
``creation data'' generated in connection with a swap's creation: 
``primary economic terms data'' and ``confirmation data.'' \135\ 
Regulation 45.3 governs what creation data must be reported, who must 
report it, and deadlines for its reporting.
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    \135\ Section 45.1 defines ``required swap creation data'' as 
primary economic terms data and confirmation data. Section 45.1 
defines ``primary economic terms data'' as ``all of the data 
elements necessary to fully report all of the primary economic terms 
of a swap in the swap asset class of the swap in question'' and 
defines ``confirmation data'' as ``all of the terms of a swap 
matched and agreed upon by the counterparties in confirming the 
swap. For cleared swaps, confirmation data also includes the 
internal identifiers assigned by the automated systems of the 
derivatives clearing organization to the two transactions resulting 
from novation to the clearing house.'' 17 CFR 45.1.
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    Proposed Sec.  45.3(e) would govern creation data reporting 
requirements for swaps that fall under the proposed definition of 
clearing swaps. Proposed Sec.  45.3(e) would require a DCO, as 
reporting counterparty under proposed Sec.  45.8(i),\136\ to report all 
required swap creation data for each clearing swap as soon as 
technologically practicable after acceptance of an original swap by a 
DCO for clearing (in the event that the clearing swap replaces an 
original swap) or as soon as technologically practicable after 
execution of the clearing swap (in the event that the clearing swap 
does not replace an original swap).\137\
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    \136\ As discussed in greater detail below, proposed Sec.  
45.8(i) would designate the DCO as the reporting counterparty for 
clearing swaps.
    \137\ As noted earlier in this release, the proposed definition 
of ``clearing swap'' is intended to encompass: (1) swaps that 
replace an original swap and to which the DCO is a counterparty 
(i.e. swaps commonly known as betas and gammas) and (2) all other 
swaps to which the DCO is a counterparty (even if such swap does not 
replace an original swap). The Commission understands that there may 
be instances in which a clearing swap does not replace an original 
swap. For example, in the preamble to the part 39 adopting release, 
the Commission noted that ``open offer'' systems are acceptable 
under Sec.  39.12(b)(6), stating that ``Effectively, under an open 
offer system there is no `original' swap between executing parties 
that needs to be novated; the swap that is created upon execution is 
between the DCO and the clearing member, acting either as principal 
or agent.''). ``Derivatives Clearing Organization General Provisions 
and Core Principles,'' 76 FR 69334, 69361, Nov. 8, 2011.
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    Additionally, the proposed rule would require DCOs to 
electronically report to a registered SDR required swap creation data 
for clearing swaps. Swaps other than clearing swaps, including swaps 
that later become original swaps by virtue of their acceptance for 
clearing by a DCO, would continue to be reported as currently required 
under existing Sec.  45.3(a) through (d). The Commission is thus 
proposing an approach to creation data reporting that would require 
reporting counterparties or SEFs/DCMs to report creation data for swaps 
commonly known as alpha swaps, and that would require DCOs to report 
creation data for swaps commonly known as beta and gamma swaps, and for 
any other swaps to which the DCO is a counterparty.
    With respect to confirmation data reporting, for swaps that are 
intended to be cleared at the time of execution, the Commission 
proposes to amend Sec.  45.3(a), (b), (c)(1)(iii), (c)(2)(iii), and

[[Page 52564]]

(d)(2) to remove certain existing confirmation data reporting 
requirements. Under the modified rules, SEFs/DCMs and reporting 
counterparties would continue to be required to report primary economic 
terms (``PET'') data as part of their creation data reporting, but 
would not be required to report confirmation data for swaps that are 
intended to be submitted to a DCO for clearing at the time of 
execution. Instead, the DCO would be required to report confirmation 
data for clearing swaps pursuant to proposed Sec.  45.3(e).
    The Commission is also proposing new Sec.  45.3(j), which would 
provide that: For swaps executed on or pursuant to the rules of a SEF 
or DCM (including swaps that become original swaps), the SEF or DCM 
would have the obligation to choose the SDR for such swaps; for all 
other swaps (including for off-facility swaps and/or clearing swaps) 
the reporting counterparty (as determined in Sec.  45.8) would have the 
obligation to choose the SDR.
i. Costs
    The Commission understands that under current industry practice, 
DCOs commonly report to SDRs creation data for swaps that would fall 
under the definition of clearing swaps. Accordingly, to the extent that 
DCOs currently report in conformance with proposed Sec.  45.3(e), the 
Commission does not expect the proposed rule to result in any 
additional costs. The Commission requests comment on specific details 
of market practice of DCOs and whether Sec.  45.3(e) would carry any 
associated costs and/or impose additional obligations that go beyond 
existing industry practice of DCOs.
    With respect to registered DCOs organized outside of the United 
States, its territories, and possessions that are subject to 
supervision and regulation in a foreign jurisdiction, a home country 
trade reporting regulatory regime may require the DCO to report swap 
data to a trade repository in the home country jurisdiction. For 
clearing swaps that a DCO would be required to report both to a 
registered SDR pursuant to the proposed amendments to part 45, and to a 
foreign trade repository pursuant to a home country trade reporting 
regulatory regime, a DCO could be expected to incur some additional 
costs in satisfying both its CFTC and home country reporting 
obligations, relative to a DCO that would only be subject to part 45 
reporting requirements. As DCOs are not required to provide such cost 
information to the Commission, the Commission presently lacks access to 
the information needed to assess the magnitude of the costs relating to 
compliance with reporting obligations in multiple jurisdictions. 
However, the Commission expects that industry technological innovations 
may effectively allow for satisfaction of swap data reporting 
requirements across more than one jurisdiction by means of a single 
data submission, and that a streamlined reporting process or other 
technology and operational enhancements could mitigate the cost of 
satisfying reporting requirements for swaps that may be required to be 
reported to a foreign trade repository under a home country regulatory 
regime as well as to a registered SDR pursuant to proposed amendments 
to part 45.\138\ Additionally, the Commission anticipates that adopting 
an approach to the reporting of cleared swaps in the United States that 
is, to the extent possible, consistent with the approaches adopted in 
other jurisdictions may also minimize compliance costs for entities 
operating in multiple jurisdictions.\139\ The Commission also notes 
that any costs arising from reporting swap data with respect to more 
than one jurisdiction could already have been realized, to the extent 
that DCOs located outside the United States are already reporting swap 
data to a registered SDR in addition to reporting swap data to trade 
repository pursuant to a home country regulatory regime.
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    \138\ As noted above, the part 45 regulations contemplate 
situations where a swap may be required to be reported pursuant to 
U.S. law and the law of another jurisdiction.
    \139\ The Commission's understanding is that the approach 
proposed in this release for the reporting of cleared swaps (e.g., 
requiring separate reporting of alphas, betas, and gammas) is 
largely consistent with the multi-swap approach adopted by a number 
of jurisdictions, including, for example, the European Union, 
Singapore, and Australia.
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    The Commission requests comment regarding any unique costs and 
benefits of proposed Sec.  45.3(e), and the proposed amendments and 
additions to part 45 generally, in regard to extraterritorial 
application, including:
     Are there any benefits or costs that the Commission 
identified in this release that do not apply, or apply to a different 
extent, to the extraterritorial application of the proposed additions 
and amendments to part 45?
     Are there any costs or benefits that are unique to the 
extraterritorial application of the proposed additions and amendments 
to part 45? If so, please specify how.
     If significant differences exist in the costs and benefits 
of the extraterritorial and domestic application of the proposed 
additions and amendments to part 45, what are the implications of those 
differences for the substantive requirements of the proposed additions 
and amendments to part 45?
     To what extent would trade reporting requirements in non-
U.S. jurisdictions require a DCO to report swap data for clearing swaps 
to a foreign trade repository in addition to a registered SDR? Please 
describe any unique costs resulting from such scenarios.
     Are there any consistencies and/or inconsistencies between 
the proposed amendments to part 45 and any foreign trade reporting 
regulations that would apply to registered DCOs that would impose costs 
or provide benefits? If so, please describe any such consistencies and/
or inconsistencies and associated cost and/or benefit implications.
    The Commission requests that comments focus on information and 
analysis specifically relevant to the questions posed above as opposed 
to addressing the cross-border scope of the part 45 regulations. The 
Commission further requests that commenters supply the Commission with 
relevant data to support their comments.
    With respect to confirmation data reporting, one commenter 
contended that requiring the reporting of confirmation data, in 
addition to PET data, is unnecessarily burdensome if the Commission 
collects the proper PET data.\140\ The Commission anticipates that the 
proposed removal of certain confirmation data reporting requirements 
will result in decreased costs for swap counterparties and/or 
registered entities that are currently gathering and conveying 
electronically the information necessary to report confirmation data 
for swaps that are intended to be submitted to a DCO for clearing at 
the time of execution.\141\
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    \140\ See CEWG letter at 4-5 (stating that reporting 
confirmation data in addition to PET data is highly redundant 
because confirmation data simply includes all of the PET data 
matched and agreed to by the counterparties).
    \141\ See ISDA letter at 6-8 (noting that ``Confirmation data 
should not be required for an alpha trade that is intended for 
clearing at point of execution, whether due to the clearing mandate 
or bilateral agreement. Confirmation data for alpha swaps is not 
meaningful since they will be terminated and replaced with cleared 
swaps simultaneously or shortly after execution for which 
confirmation data will be reported by the DCO.'').
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    Finally, with respect to choice of SDR, the Commission 
preliminarily believes that amendments to Sec.  45.3(j) will not impose 
any additional costs because the amendments simply codify existing 
practice--the Commission understands that the workflows that apply the 
proposed choice of SDR obligations are already in place.
    The Commission preliminarily believes that allowing DCOs to choose

[[Page 52565]]

the SDRs to which they report creation and continuation data is cost-
minimizing for DCOs because it allows them to select the SDR which is 
most cost effective. Therefore, as discussed in greater detail below, 
the Commission anticipates that DCOs that have affiliated SDRs will 
continue their current practice of reporting clearing swaps to their 
affiliated SDRs.
ii. Benefits
    Proposed Sec.  45.3(e) would explicitly articulate DCO part 45 
reporting obligations with respect to clearing swaps (e.g., betas and 
gammas).\142\ As explained above, existing Sec.  45.3 does not 
explicitly acknowledge distinct reporting requirements for swaps 
commonly known as alphas, betas, and gammas. The proposed amendments 
will explicitly delineate creation data reporting obligations for each 
component of a cleared swap transaction, which would improve the 
Commission's ability to analyze data associated with such transactions.
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    \142\ The Commission acknowledges that the alternatives 
separately discussed in the Consideration of Alternatives section 
later in this release could also provide these benefits for 
registered entities and swap counterparties. However, for the 
reasons explained in that section, the Commission is of the view 
that the proposed approach is more consistent with industry practice 
than the alternatives.
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    Requiring DCOs to report required swap creation data for clearing 
swaps to SDRs in the manner proposed in this release is expected to 
result in uniform protocols and consistent reporting of the individual 
components of a cleared swap transaction. DCOs already have the 
processes, procedures, and connectivity in place for reporting swap 
data to some registered SDRs, and given that DCOs utilize automated 
systems to communicate with SDRs, the Commission expects the data 
submitted by DCOs to SDRs to be standardized and readily available. The 
Commission submits that the proposed reporting framework for cleared 
swaps will result in more consistent reporting of all components of a 
cleared swap transaction, including linkages between the related swaps, 
thereby increasing the efficiency of the SDR data collection function 
and enhancing the Commission's ability to utilize the data for 
regulatory purposes, including for systemic risk mitigation, market 
monitoring, and market abuse prevention.
    With respect to the proposed removal of certain confirmation data 
reporting requirements for swaps that are intended to be submitted to a 
DCO for clearing at the time of execution, the Commission is of the 
view that the proposed confirmation data reporting requirements for 
clearing swaps should provide necessary confirmation data with respect 
to cleared swap transactions. Given that the proposed rules would 
require the DCO to report confirmation data for clearing swaps, 
requiring an additional set of confirmation data reporting for the now-
terminated original swap, in addition to PET data, would be unnecessary 
and provide little benefit.
    Finally, with respect to choice of SDR, under proposed Sec.  
45.3(j), the party with the obligation to choose the SDR has the 
discretion to select the SDR of its choice. This could be an SDR with 
which the party already has a working relationship, an SDR which is, in 
the registered entity or reporting counterparty's estimation, most 
cost-effective, or an SDR that provides the best overall service and 
product. This flexibility to select SDRs may minimize reporting errors 
and foster competition between SDRs, as swap data for a particular 
reporting counterparty would be maintained in fewer SDRs, and may 
reduce costs, as reporting counterparties and registered entities 
(other than DCOs) should not have to establish connection to more than 
one SDR unless they prefer to do so. The Commission's understanding is 
that Sec.  45.3(j) is consistent with industry practice,\143\ and thus 
that the benefits described above are already being realized.
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    \143\ The Commission notes that industry practice with respect 
to choice of SDR has likely been influenced in part by a variety of 
factors, including, among others, the Commission's statement 
regarding CME Rule 1001. See Statement of the Commission on the 
Approval of CME Rule 1001 at 6, Mar. 6, 2013. The Commission notes 
that other DCOs have adopted similar rules. See, e.g., ICE Clear 
Credit Rule 211.
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5. Continuation Data Reporting by Derivatives Clearing Organizations--
Proposed Amendments to Sec.  45.4
    The Commission proposes amendments to Sec.  45.4, which governs the 
reporting of swap continuation data to an SDR during a swap's existence 
through its final termination or expiration, to incorporate the 
distinction between original swaps and clearing swaps. The Commission 
is also proposing to remove Sec.  45.4(b)(2)(ii), which requires a 
reporting counterparty that is an SD or MSP to report valuation data 
for cleared swaps daily; instead, the DCO would be the only swap 
counterparty required to report swap continuation data, including 
valuation data, for clearing swaps.
    Notably, proposed Sec.  45.4(c) would require a DCO to report all 
required continuation data for original swaps, including original swap 
terminations, to the SDR to which such original swap was reported. 
Finally, proposed Sec.  45.4(c)(2) would require that continuation data 
reported by DCOs include the following data fields as life cycle event 
data or state data for original swaps pursuant to proposed Sec.  
45.4(c)(1): (i) The LEI of the SDR to which each clearing swap that 
replaced a particular original swap was reported by the DCO pursuant to 
new Sec.  45.3(e); (ii) the USI of the original swap that was replaced 
by the clearing swaps; and (iii) the USIs for each of the clearing 
swaps that replace the original swap.
i. Costs
    Currently, Sec.  45.4(b)(2) requires that both SDs/MSPs and DCOs 
report daily valuation data for cleared swaps. The proposed removal of 
Sec.  45.4(b)(2)(ii) would eliminate the existing valuation data 
reporting requirement for SDs/MSPs, leaving DCOs as the sole entity 
responsible for daily valuation data reporting. As DCOs are currently 
required to report valuation data for cleared swaps, they would not 
bear any additional costs as a result of this proposed amendment.
    With respect to termination notices, one commenter stated that DCOs 
should not be required to report termination of a cleared alpha because 
doing so would result in increased operational costs associated with 
establishing linkages to all registered SDRs.\144\ While DCOs are 
currently required to report continuation data, including terminations, 
to SDRs under existing Sec.  45.4,\145\ the Commission's understanding 
is that DCOs do not consistently report original swap terminations. 
DCOs that do not currently have connectivity to the SDR where the SEF/
DCM or original counterparties first reported the swap would incur 
costs associated with establishing such connectivity. DCOs will also 
realize costs associated with the termination notice and submissions 
correcting previously erroneously reported or omitted data. However, 
DCO reporting of alpha swap terminations has not been uniform or 
consistent and

[[Page 52566]]

may vary by DCO and SDR, and the Commission is generally aware that in 
some instances, DCOs currently report alpha swap terminations to the 
original SDR that received the original submission of the intended to 
be cleared swap. The proposed rules thus will not introduce any new 
costs for those DCOs which have already implemented systems to report 
alpha swap terminations to SDRs.
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    \144\ See OTC Hong Kong letter at 2-3 (contending that setup, 
application development, and testing to interface with each SDR is 
likely to require at least 150 man-days, and that a more cost-
effective framework would be to require the original counterparty to 
report termination of the alpha once it receives confirmation that 
the alpha has been accepted for clearing, and that the original 
counterparty would already have in place technical and operational 
interfaces with the SDR of its choice. The commenter also contended 
that the burden on DCOs of additional reporting outweighs the 
benefits to the CFTC).
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    The Commission requests more detailed information regarding the 
nature and amount of the costs identified above, as well information 
about the nature and amount of any other costs likely to result from 
proposed Sec.  45.4(c), including a description of market practice as 
it relates to those costs. The Commission also requests information 
regarding whether DCOs are currently reporting alpha swap terminations 
and the scope of such reporting relative to all swaps accepted for 
clearing by such DCOs. The Commission notes that it does not possess 
the information required to quantify such costs since DCOs and SDRs are 
not required to provide the relevant information regarding cost 
structures to the Commission, but requests that commenters provide 
quantitative estimates, as well as data and other information to 
support those estimates.
    With respect to the proposed additional data fields, as discussed 
above, proposed Sec.  45.4(c)(2) would add three data fields (the LEI 
of the SDR to which creation data for the clearing swaps was reported, 
the USI of the original swap, and USIs of the clearing swaps) to the 
life cycle event data or to state data reported by DCOs as continuation 
data for original swaps.\146\ All three of these data fields are either 
already in use or can be created by the SDR and reported by the DCO. 
While requiring the reporting of additional fields may impose costs, 
DCOs should already possess the information needed for these fields, 
and the Commission preliminarily believes that the extra costs to DCOs 
associated with proposed Sec.  45.4(c)(2) would be minimal. The 
Commission does not possess the information required to quantify such 
costs since DCOs and SDRs are not required to provide to the Commission 
the relevant information regarding the costs associated with creating 
and using these fields, but requests that commenters provide 
quantitative estimates, as well as data and other information to 
support those estimates.
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    \146\ ``Required swap continuation data'' is defined in Sec.  
45.1 and includes ``life cycle event data'' or ``state data'' 
(depending on which reporting method is used) and ``valuation 
data.'' Each of these data types is defined in Sec.  45.1. ``Life 
cycle event data'' means ``all of the data elements necessary to 
fully report any life cycle event.'' ``State data'' means ``all of 
the data elements necessary to provide a snapshot view, on a daily 
basis of all of the primary economic terms of a swap . . .'' 17 CFR 
45.1.
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ii. Benefits
    Proposed Sec.  45.4(c) would ensure that data concerning original 
swaps remains current and accurate, allowing the Commission to 
ascertain whether an original swap was terminated through clearing 
novation. Original swap data that does not reflect the current state of 
the swap frustrates the use of swap data for regulatory purposes, 
including, but not limited to, assessing market exposures between 
counterparties and evaluating compliance with the clearing requirement. 
The Commission is of the view that, to the extent that DCOs' current 
practices are not currently in conformance with the proposed rule, 
requiring the DCO to report continuation data for original swaps is the 
most efficient and effective method to ensure that data concerning 
original swaps remains current and accurate as the DCO, through its 
rules, determines when an original swap is terminated and thus has the 
quickest and easiest access to authoritative information concerning 
termination of the original swap.
    Proposed Sec.  45.4(c) would ensure that part 45 explicitly 
addresses DCO part 45 continuation data reporting obligations with 
respect to original swaps (i.e., alphas).\147\ Existing Sec.  45.4(b), 
which addresses ``continuation data reporting for cleared swaps,'' 
requires DCOs to report continuation data for ``all swaps cleared by a 
[DCO],'' but does not explicitly address the multi-swap framework 
provided in Sec.  39.12(b)(6).\148\ Therefore, uncertainty persists as 
to whether, under existing Sec.  45.4(b) the DCO must report 
continuation data for the alpha, beta and gamma swaps. The inconsistent 
interpretation of this reporting requirement leads to substantial 
differences in reporting of cleared swaps and presents challenges for 
regulatory oversight. The Commission understands that the continuation 
data reporting requirements could benefit from greater clarity 
regarding the obligations to report continuation data for original 
swaps that have been terminated and the clearing swaps that replace a 
terminated original swap.
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    \147\ The Commission acknowledges that the alternatives 
separately discussed in the Consideration of Alternatives section 
later in this release could also provide these benefits for 
registered entities and swap counterparties. However, for the 
reasons explained in that section, the Commission is of the view 
that the proposed approach is superior to the alternatives.
    \148\ As discussed earlier in this release, Sec.  39.12(b)(6) 
provides that upon acceptance of a swap by a DCO for clearing, the 
original swap is extinguished and replaced by equal and opposite 
swaps, with the DCO as the counterparty to each such swap. See 17 
CFR 39.12(b)(6).
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    With respect to the valuation data reporting requirements of 
current Sec.  45.4(b)(2)(ii), while one commenter contended that it 
would be valuable for the Commission to receive counterparty valuations 
for all swaps, whether cleared or uncleared,\149\ several commenters 
contended that the DCO is the best and ultimate source of the valuation 
reporting for cleared swaps. The benefit to the Commission of receiving 
cleared swap valuation data from SDs/MSPs would not justify the 
significant expense and difficulty incurred by SDs/MSPs to report this 
data to the SDR.\150\
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    \149\ See Markit letter at 11.
    \150\ See ABA letter at 2, ISDA letter at 13-14 (noting that the 
cost savings for SDs/MSPs who would otherwise have to build to 
additional SDRs solely for the purpose of reporting valuation data 
greatly outweighs any perceived benefit of receiving such data), JBA 
letter at 2, MFA letter at 4 (contending that the valuation data 
provided by the DCO will generally be more accurate and robust than 
that from a given reporting counterparty, as the DCOs have 
procedures in place for valuing open swap positions that source and 
validate pricing information from a variety of sources), and NGSA 
letter at 4-5 (noting that imposing valuation data reporting on DCOs 
alone also alleviates unnecessary burdens on SDRs, who would receive 
fewer messages on a daily basis).
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    The Commission preliminarily believes that the Sec.  45.4(b)(2) 
proposal to remove the requirement that SDs and MSPs report daily 
valuation data for cleared swaps could result in cost savings to the 
extent that any SDs and MSPs are not currently relying on no-action 
relief.\151\ In addition, because there are fewer DCOs than non-DCO 
reporting counterparties, placing the responsibility to report 
valuation data solely on the DCO will result in a more consistent and 
standardized valuation reporting scheme, as there would be a dramatic 
decrease in the number of potential valuation data submitters to SDRs. 
This would benefit SDRs, regulators, and the public because it would 
facilitate data aggregation and improve the Commission's ability to 
analyze SDR data and to satisfy its risk and market oversight 
responsibilities, including measurement of the notional

[[Page 52567]]

amount of outstanding swaps in the market.
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    \151\ See CFTC Division of Market Oversight, No-Action Letter 
No. 12-55, Dec. 17, 2012; No-Action Letter No. 13-34, Jun. 26, 2013; 
No-Action Letter No. 14-90, Jun. 30, 2014; and No-Action Letter 
No.15-38, June 15, 2015. Staff no-action relief from the 
requirements of Sec.  45.4(b)(2)(ii) has been in effect since the 
initial compliance date for part 45 reporting.
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    Proposed Sec.  45.4(c)(2) would require DCOs to report three 
important continuation data fields for original swaps which would 
assist regulators in tracing the history of, and associating the 
individual swaps involved in, a cleared swap transaction, from 
execution of the original swap through the life of each clearing swap 
that replaces an original swap, regardless of the SDR(s) to which the 
original and clearing swaps are reported. The newly required 
continuation data elements to be reported by the DCOs for original 
swaps will ensure that original swap continuation data includes 
sufficient information to identify, by USI, any clearing swaps created 
from the same original swap, as well as the SDR where those clearing 
swaps reside. As such, the Commission expects that review of any 
particular swap in a registered SDR will include a listing of all other 
relevant USIs with respect to that swap (e.g., original swap and 
clearing swaps). The Commission believes that this requirement will 
help ensure the availability of information necessary to link original 
swaps and clearing swaps, even if those swaps are reported to different 
SDRs. The ability to link original and clearing swaps across multiple 
SDRs would decrease data fragmentation and would increase the ability 
of the Commission to accurately aggregate cleared swap data across 
various SDRs. As a result, proposed Sec.  45.4(c)(2) would improve the 
ease of use for cleared swaps data, which will enhance the Commission's 
ability to perform its regulatory duties, including to protect market 
participants and the public.
6. Unique Swap Identifier Creation by Derivatives Clearing 
Organizations--Sec.  45.5(d)
    Regulation 45.5 currently requires that each swap subject to the 
Commission's jurisdiction be identified in all swap recordkeeping and 
data reporting by a USI. The rule establishes different requirements 
for the creation and transmission of USIs depending on whether the swap 
is executed on a SEF or DCM or executed off-facility with or without an 
SD or MSP reporting counterparty. Section 45.5 also provides that for 
swaps executed on or pursuant to the rules of a SEF or DCM, the SEF or 
DCM creates the USI, and for swaps not executed on or pursuant to the 
rules of a SEF or DCM, the USI is created by an SD or MSP reporting 
counterparty, or by the SDR if the reporting counterparty is not an SD 
or MSP.
    Proposed new rule Sec.  45.5(d) would require a DCO to generate and 
assign a USI for a clearing swap upon, or as soon as technologically 
practicable after, acceptance of an original swap by the DCO for 
clearing (in the event the clearing swap replaces an original swap) or 
execution of a clearing swap (in the event that the clearing swap does 
not replace an original swap), and prior to reporting the required swap 
creation data for the swap. Proposed Sec.  45.5(d) contains provisions 
governing creation and assignment of USIs by the DCO that are 
consistent with analogous provisions governing creation and assignment 
of USIs by SEFs, DCMs, SDs, MSPs, and SDRs.
i. Costs
    The Commission believes that proposed Sec.  45.5(d) is largely 
consistent with industry practice and will not result in any additional 
costs for DCOs. Any DCOs that would not be in complete conformance with 
the proposed rule might have to enhance their existing technological 
protocols in order to create USIs in house, but these marginal costs 
would likely be lower than the costs associated with obtaining a USI 
with a separate USI-creating entity. While the Commission believes that 
creating USIs in-house, rather than with a different USI creating 
entity, might be less costly for DCOs, the Commission currently lacks 
data on that comparison and requests that commenters submit comments 
and/or data to estimate the quantifiable costs associated with USI 
creation.
ii. Benefits
    As noted above, the existing part 45 regulations do not explicitly 
address the assignment of USIs to swaps that fall within the proposed 
definition of clearing swaps. Explicitly requiring DCOs to generate, 
assign and transmit USIs for clearing swaps would provide regulatory 
certainty with respect to the generation and assignment of USIs for 
clearing swaps. The proposal would also help ensure consistent and 
uniform USI creation and assignment for such swaps and would allow 
regulators to better identify and trace the swaps generally involved in 
cleared swap transactions, from execution of the original swap through 
the life of each clearing swap.
7. Determination of the Reporting Counterparty for Clearing Swaps-Sec.  
45.8
    Current Sec.  45.8 establishes a hierarchy under which the 
reporting counterparty for a particular swap depends on the nature of 
the counterparties involved in the transaction. DCOs are not included 
in the existing Sec.  45.8 hierarchy. The Commission is proposing to 
amend Sec.  45.8 in order to identify DCOs in the hierarchy as the 
reporting counterparty for clearing swaps.
i. Costs
    The Commission does not anticipate that the proposed amendments to 
Sec.  45.8, in and of themselves, will impose any additional costs on 
registered entities or reporting counterparties. The Commission 
preliminarily believes that the rule simply reflects established 
reporting arrangements, which, to the Commission's understanding, is 
for the DCO to submit data to the SDR for swaps that would fall within 
the definition of clearing swaps.
ii. Benefits
    As noted above, clearing swaps are not explicitly acknowledged in 
existing Sec.  45.3, and DCOs are not identified as reporting 
counterparties in the reporting counterparty hierarchy of Sec.  45.8. 
The Commission expects that modifications to the Sec.  45.8 reporting 
counterparty hierarchy will eliminate ambiguity regarding which 
registered entity or swap counterparty is required to report required 
creation data for clearing swaps, explicitly delineating the nature and 
extent of DCO reporting obligations, and affording market participants 
and SDRs a more precise and accurate understanding of reporting 
obligations under part 45.\152\
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    \152\ The Commission acknowledges that the alternatives 
separately discussed in the Consideration of Alternatives section 
later in this release could also provide these benefits for 
registered entities and swap counterparties. However, for the 
reasons explained in that section, the Commission is of the view 
that the proposed approach is more consistent with industry practice 
than the alternatives.
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8. Reporting to a Single Swap Data Repository--Sec.  45.10
    Regulation 45.10 currently requires that all swap data for a given 
swap must be reported to a single SDR, which must be the same SDR to 
which creation data for that swap is first reported. The time and 
manner in which such data must be reported to a single SDR depends on 
whether the swap is executed on a SEF or DCM or executed off-facility 
with or without an SD/MSP reporting counterparty. The Commission is 
proposing to require DCOs to report all data for a particular clearing 
swap to a single SDR. Moreover, consistent with current industry 
practice, proposed Sec.  45.10(d)(3) would require the DCO to report 
all required swap creation data for each clearing swap that replaces a 
particular original swap (i.e., the beta and gamma that replace a 
particular

[[Page 52568]]

alpha) to a single SDR, such that all required creation data and all 
required continuation data for all clearing swaps that can be traced 
back to the same original swap would be reported to the same SDR 
(although not necessarily the same SDR as the original swap).
i. Costs
    The Commission does not expect DCOs to incur any new costs 
associated with ensuring that clearing swap data is reported to a 
single SDR because the requirements of the proposed rule are, to the 
Commission's understanding, consistent with current DCO reporting 
practice.
ii. Benefits
    The Commission preliminarily believes that the benefit of reporting 
data associated with each clearing swap to a single SDR is that all 
required creation data, all required continuation data for related 
clearing swaps and, by extension, USIs linking clearing swaps to the 
original swap, would be stored with the same SDR. This would minimize 
confusion on the part of SDRs and regulators regarding which swaps are 
still active and which ones have been terminated. The Commission notes 
that the benefits of reporting all data for clearing swaps to the same 
SDR are currently being realized, as it is current industry practice 
for DCOs to report swaps that would fall under the proposed definition 
of clearing swaps in conformance with proposed Sec.  45.10(d)(3).
9. Primary Economic Terms Data--Amendments to the Primary Economic 
Terms Data Tables for Clearing Swaps
    The Commission's current lists of minimum (required) primary 
economic terms for swaps in each swap asset class are found in tables 
in Exhibits A through D of appendix 1 to part 45. The Commission 
proposes to add several new data elements under the heading 
``Additional Data Categories and Fields for Clearing Swaps'' to 
Exhibits A through D in order to more accurately capture the 
additional, unique features of clearing swaps that are not relevant to 
uncleared swaps. The newly proposed data fields include: The USI for 
the clearing swap; the USI for the original swap; the SDR to which the 
original swap was reported; clearing member LEI, clearing member client 
account origin, house or customer account; clearing receipt timestamp; 
and clearing acceptance timestamp.
    The Commission also proposes to add several new required data 
elements which would be applicable to all swaps, and to make conforming 
changes to some existing data elements. The newly proposed fields 
include: Asset class, an indication of whether the reporting 
counterparty is a DCO with respect to the swap, and clearing exception 
or exemption types.
i. Costs
    A number of commenters noted that making any changes and additions 
to required data fields could present substantial costs and operational 
burdens.\153\ However, these comments, which did not come from DCOs, 
related to creation data reporting fulfilled by a swap counterparty and 
not by a registered entity. The newly proposed data fields for clearing 
swaps would be reported exclusively by DCOs. The Commission 
preliminarily believes that DCOs are better situated than swap 
counterparties to report the additional fields for clearing swaps 
without the substantial costs and operational burdens cited by 
commenters because DCOs already possess certain information, or other 
registered entities and swap counterparties are required to transmit 
the information to DCOs, regarding those fields. For example, the data 
necessary to report the proposed ``original swap SDR'' field is 
currently required to be transmitted to the DCO under existing Sec.  
45.5, and the Commission understands that data required by the proposed 
``clearing receipt timestamp'' and ``clearing acceptance timestamp'' 
fields may already be generated and present in DCO systems--such DCOs 
would just have to transfer those timestamps to the reporting system 
for each clearing swap. Similarly, the Commission understands that 
house or customer account designations are already collected and 
maintained in relation to certain part 39 reporting obligations. Hence, 
there would be no additional cost in collecting the information 
necessary to report the ``origin (house or customer)'' field, and 
marginal costs would stem from conveying the information in part 45 
swap data reports. The Commission notes that it does not currently have 
complete information regarding the extent to which DCOs may already 
possess the information required by the proposed additional fields. 
Accordingly, for each of the proposed new data fields for clearing 
swaps, the Commission requests comment regarding the extent to which 
DCOs currently possess the required information, and the costs 
associated with obtaining and/or reporting such information.
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    \153\ See, e.g., CDEU letter at 1-2, CMC letter at 5, EDF 
Trading North American at 6, and International Energy Credit 
Association at 5.
---------------------------------------------------------------------------

    The Commission expects that the addition of the three data fields 
applicable to all reporting entities for all swaps will result in some 
increase in costs. The Commission does not currently possess the data 
needed to quantify such costs since reporting entities and SDRs are not 
required to provide to the Commission the relevant information 
regarding the costs associated with creating and using these fields, 
but requests that commenters provide quantitative estimates, as well as 
data and other information to support such estimates. The information 
necessary to report these data elements is likely to be readily 
available in connection with the execution of swaps, with some marginal 
costs stemming from the requirement to include the information in PET 
data reported to an SDR (to the extent that such information is not 
already reported). The Commission understands that in some cases, 
market practice is to report some of the information required by the 
proposed three new data fields applicable to all reporting entities for 
all swaps.
ii. Benefits
    The Commission preliminarily believes that the proposed additions 
to the list of minimum primary economic terms would result in a variety 
of benefits. Fields such as USI for the original swap or the SDR to 
which the original swap was reported may facilitate the monitoring of 
each original swap by SDRs and regulators and may prevent potential 
double-counting of swap transactions or notional amounts, thus 
improving the accuracy of SDR data. Other proposed fields such as 
clearing member LEI or clearing member client account information would 
facilitate the Commission's assessment of risk management of market 
participants, promoting the protection of the financial integrity of 
the markets and the protection of market participants and the public. 
The asset class data field would assist the Commission in determining 
the asset class for swaps reported to SDRs, enhancing the Commission's 
ability to identify swaps activity in each asset class as well as the 
capability to use the data for regulatory purposes. The indication of 
whether the reporting counterparty is a DCO with respect to the swap 
data field would identify when a DCO is a reporting counterparty for 
clearing swaps, increasing the ability to interpret and utilize data 
for these swaps. The clearing exception or exemption types data field 
would

[[Page 52569]]

enable the Commission to ascertain the specific exception or exemption 
from the clearing requirement that was elected and would assist in the 
evaluation of compliance with the clearing requirement, as well as 
assessing market activity in the uncleared swap markets.
10. Consideration of Alternatives
    The Commission considered the costs and benefits of certain 
alternatives raised by commenters in response to the Commission's 2014 
request for comment, including whether part 45 should require intended 
to be cleared swaps (original swaps) to be reported to registered SDRs. 
Some commenters noted that reporting of alpha swaps is beneficial and 
should continue to be required,\154\ while other commenters contended 
that alpha swaps should not be required to be reported to an SDR and 
questioned the benefits of requiring the reporting of alpha swaps.\155\
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    \154\ See TR SEF letter at 10 (stating that the information 
associated with the reporting of alpha swaps is necessary for 
surveillance and audit trail purposes, that it would be helpful for 
the Commission to see all three swaps when analyzing data, and that 
if only the beta and gamma are reported, the Commission would not 
easily see where the swap was originally executed), AFR letter at 5 
(stating that in general, all life cycle information relevant to 
track a swap from initial conception to clearing should be included 
in reporting, including the reporting of the initial alpha swap 
prior to novation into clearing, because such information will be 
useful in tracking trends in clearing use, including enforcement of 
the clearing mandate and optional use of clearing), Markit letter at 
25 (stating that reporting requirements in relation to the alpha 
swap should not be modified or waived because it will often be 
essential for the Commission to know the exact origin of a cleared 
swap transaction, particularly for market surveillance purposes), 
and DTCC letter at 17-18 (stating that: Any changes to the 
Commission's reporting requirements that would not require the 
reporting of swap transaction data to SDRs of all swaps, including 
alpha swaps, would be inconsistent with CEA section 2(a)(13)(G); 
that a material, price forming event occurs upon execution of an 
alpha swap; that regulators should continue to require the reporting 
of alpha swap data in order to maintain a complete audit trail of 
all transaction-level activity related to a swap trade; and that in 
order to understand the origin of cleared swaps, regulators must 
have the ability to access and examine the connections between the 
alpha, beta, and gamma swaps).
    \155\ See SIFMA letter at 4 (stating that separately reporting 
alpha swaps to SDRs can result in misleading data being retained by 
SDRs, and that this is particularly concerning if alphas and 
subsequent betas and gammas are reported to different SDRs, which 
could result in double counting of swaps), CEWG letter at 15 
(contending that counterparties enter into an alpha with the 
expectation that it will be cleared almost immediately thereafter, 
and that requiring the reporting of alpha, beta, and gamma swaps 
might result in parties reporting related swaps to different SDRs), 
CME letter at 2-3 (contending that there is no value in having 
execution venues report intended-to-be-cleared swaps that will exist 
only for a few seconds, and that amending the rules such that the 
DCO is the only party with reporting responsibilities for intended-
to-be-cleared swaps would lower operational risk, cost, and burden, 
and would ensure the Commission gets data directly from the source), 
MFA letter, and ISDA letter.
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    Some commenters stated that the Commission should require resulting 
swaps to be reported to the same SDR as original swaps, so that the 
entire history of a swap would reside at the same SDR.\156\ A number of 
commenters suggested that part 45 should place swap data reporting 
obligations solely on DCOs, including with respect to swaps that are 
intended to be cleared at the time of execution and accepted for 
clearing by a DCO (swaps commonly known as ``alpha'' swaps) and swaps 
resulting from clearing (swaps commonly known as ``beta'' and ``gamma'' 
swaps).\157\ However, one commenter noted that it would not be 
appropriate to require a DCO to report information related to the 
execution of an alpha swap.\158\
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    \156\ See DTCC letter at 2-3, appendix at 4, 21 (arguing that 
the Commission should adopt a ``single SDR'' rule to ensure that all 
of the data for a swap is available in one SDR); ISDA letter at 44 
(contending that original and resulting swaps should be reported to 
the same SDR when a swap was executed without the intention or 
requirement to clear, but is subsequently cleared).
    \157\ See CMC letter at 1, 3, 6 (noting that ``cleared swaps 
reporting should be handled exclusively by DCOs.''); NFPEA letter at 
12 (noting that ``If and when a swap is cleared and thereafter, all 
information about the swap should be reported to the SDR solely by 
the DCO''); EEI letter at 3, 14 (stating that the Commission should 
put all obligations for reporting cleared swaps on DCOs and that the 
DCO is the only entity with access to all relevant information to 
trace a cleared swap for its entire existence and is the only entity 
that can provide the Commission with position information for 
individual market participants); ICE letter at 3, 17 (stating that 
the DCO should be the sole reporting party for intended to be 
cleared swaps, that reporting prior to acceptance of a swap for 
clearing introduces another point of failure in the reporting chain, 
and that there is little if any benefit of requiring a party other 
than the DCO to report, as the intended to be cleared swap exists 
only for a few seconds); CEWG letter at 16 (``The Working Group 
recommends that the Part 45 regulations be amended to make clear 
that the DCO has the reporting obligations (creation and 
continuation data) for the original alpha swap and resulting 
positions . . .''); CME letter at 20 (contending that the act of 
submitting an intended to be cleared swap to a DCO should completely 
discharge the reporting obligations of each reporting counterparty, 
SEF or DCM, and that this position would be consistent with 
Congressional intent and would help ensure the Commission gets 
access to the best possible information for regulatory purposes 
without imposing unnecessary costs on the Commission or market 
participants); DTCC letter at 21 (noting that placing the cleared 
swap reporting burden exclusively on DCOs would eliminate the 
possibility of duplicate reporting for cleared swaps, which would 
eliminate the need to require reporting counterparties and SDRs to 
adopt costly and elaborate mechanisms); and NFP Electric 
Associations letter at 4.
    \158\ See LCH letter at 10 (``It would not be appropriate to 
oblige the DCO to enhance Part 45 reporting in order to source 
information regarding the original execution that should be provided 
directly by the execution venue or execution counterparties.'').
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    In light of these comments, the Commission considered the costs and 
benefits of four alternatives in comparison to the costs and benefits 
of the proposed rule: (1) Requiring original and clearing swaps to be 
reported to the same SDR chosen by the reporting counterparty or SEF/
DCM; (2) requiring original and clearing swaps to be reported to the 
same SDR chosen by the DCO accepting the swap for clearing; (3) 
requiring only one report for each swap intended for clearing, that is, 
not requiring original (alpha) swaps to be reported separately from 
clearing swaps, with the SDR chosen by the reporting counterparty or 
SEF/DCM; and (4) requiring only one report for each swap intended for 
clearing as in (3), but with the SDR chosen by the DCO accepting the 
swap for clearing.
    The first two alternatives each require swaps that are intended to 
be cleared and the resulting clearing swaps to be reported to the same 
SDR. If such swaps were reported to the same SDR, there would be no 
need for certain requirements in proposed Sec.  45.4(c) that extra 
fields, such as clearing swap SDR, be included in the report to the SDR 
for the clearing swap to link the clearing swap to an original swap on 
a different SDR. Similarly, the need for certain clearing swap PET data 
fields, such as the identity of the original SDR, intended to be used 
for linking purposes, might not be necessary. This would reduce costs 
relative to the proposed rule. Moreover, DCOs would incur reduced costs 
since they would only have to report data regarding cleared swap 
transactions to a single SDR. Further, market participants and the 
Commission could access all information about a single set of related 
original and clearing swaps at a single SDR, also reducing costs 
relative to the proposed rule.
    However, because the proposed rule more closely reflects current 
industry practice relative to the alternative, there would be some 
potentially significant one-time costs, including the costs of changes 
to existing systems, associated with changing practices to conform to 
the alternatives. Additionally, a substantial portion of aggregation 
costs for regulators, and, likely, market participants, arises from the 
current landscape, which includes multiple SDRs. The proposed 
requirements to link original and clearing swaps at multiple SDRs is a 
relatively minor burden compared with the larger, already- incurred 
costs from having multiple SDRs. Additionally, costs associated with 
monitoring and aggregation would likely be mitigated by the 
continuation data fields of proposed

[[Page 52570]]

Sec.  45.4(c)(2), which would enable regulators to more effectively 
connect original swaps at one SDR with clearing swaps at another SDR.
    Regarding who would choose the single SDR, the SDR could be chosen 
by the reporting counterparty (or DCM or SEF) or by the DCO. Under 
either of the first two alternatives, one registered entity or 
counterparty's choice of SDR would bind a second registered entity or 
counterparty to also report to that SDR, which could be an SDR that the 
second registered entity or counterparty would not otherwise select. 
Allowing the reporting counterparty or SEF/DCM to choose the SDR would 
enable the reporting party to choose the SDR with the best combination 
of prices and service, and thus may promote competition among SDRs. 
Allowing the DCO to choose the SDR would likely result in the DCO 
always choosing the same SDR, which may be the SDR that is affiliated 
with the DCO (that is, shares the same parent company). This would 
reduce costs for DCOs since they would need to maintain connectivity 
with only one SDR, but would limit the ability of SDRs to compete since 
DCOs could choose to report only to SDRs with which they are 
affiliated. The Commission requests comment on the extent to which SDRs 
compete on the basis of price or service and the extent to which SDRs 
are chosen on the basis of relationships with registered entities and 
reporting counterparties.
    Under the third and fourth alternatives, there would be no 
requirement to report intended to be cleared swaps (original swaps) 
separately from the resulting clearing swaps. Rather, there would only 
be one report for each cleared swap transaction. This would be a change 
from current swap market practice but is similar to existing practice 
in the futures market where there is no separate record for futures 
contracts before they are cleared. As with the first two alternatives, 
the choice of SDR could be made by the reporting counterparty as 
determined under current Sec.  45.8, or by the DCO as under proposed 
Sec.  45.8(i). If there is only one report for each cleared swap 
transaction, there would be ongoing cost savings associated with the 
need to make fewer reports to SDRs. As with the first two alternatives, 
there would be no need for the requirement in proposed Sec.  45.4(c) 
that extra fields, such as clearing swap SDR, be included in the report 
to the SDR to link the clearing swap to an original swap on a different 
SDR, and market participants and the Commission could access all 
information about a single cleared swap transaction at a single SDR. 
This would also reduce costs relative to the proposed rule. However, 
the benefits of separate reports for original and clearing swaps would 
be foregone and there may be a less complete record of the history of 
each cleared swap. It may be possible to reclaim these benefits through 
requiring additional fields in each cleared swap report (although this 
would also increase costs). Moreover, because the proposed rule more 
closely reflects current industry practice relative to these 
alternatives, there would be some potentially significant one-time 
costs, including the costs of changes to existing systems, associated 
with changing practices to conform to the alternatives. The effects of 
who chooses the SDR are similar to the effects described for the first 
two alternatives.
    The Commission has determined not to propose the alternatives at 
this time because the proposed rule is more consistent with current 
industry practice than the alternatives. The Commission understands 
that reporting counterparties and registered entities are already set 
up to report alpha swaps to registered SDRs (whether or not such swaps 
are intended to be cleared at the time of execution) and that DCOs are 
already set up to report beta and gamma swaps that result from 
acceptance of a swap for clearing, and have been making such reports. 
Accordingly, the industry has already incurred the costs of setting up 
a system for reporting cleared swap transactions to SDRs (including 
separate reports for swaps that would fall within the proposed 
definitions of original and clearing swaps). Changing this system to 
conform to an alternative rule would be costly, and the Commission 
notes that these practices did not evolve as a direct consequence of 
Commission actions.
    The Commission also preliminarily believes that clarifying distinct 
reporting requirements in part 45 for alphas (swaps that become 
original swaps) and betas and gammas (clearing swaps that replace 
original swaps) presents a full history of each cleared swap 
transaction and permits the Commission and other regulators to identify 
and analyze each component part of such transactions. The Commission 
also continues to hold the view that placing the part 45 reporting 
obligation on the counterparty or registered entity closest to the 
source of, and with the easiest and fastest access to, complete and 
accurate data regarding a swap fosters accuracy and completeness in 
swap data reporting. In light of these benefits, the Commission 
proposes to maintain the current industry practice of separately 
reporting both alpha swaps (i.e., swaps that would become original 
swaps under the proposed rules) and beta and gamma swaps (i.e., 
clearing swaps as defined under the proposed rules).
    Additionally, the multi-swap reporting approach proposed in this 
release is largely consistent with the approach proposed by the SEC in 
its release proposing certain new rules and rule amendments to 
Regulation SBSR,\159\ and is also largely consistent with the approach 
adopted by several foreign regulators.\160\ Given that the swaps market 
is global in nature, the Commission anticipates that adopting an 
approach to the reporting of cleared swaps in the United States that is 
consistent with the approaches adopted in other jurisdictions may 
minimize compliance costs for entities operating in multiple 
jurisdictions.
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    \159\ See ``Regulation SBSR--Reporting and Dissemination of 
Security-Based Swap Information,'' 80 FR 14740, Mar. 19, 2015.
    \160\ The Commission's understanding is that a number of 
jurisdictions, including the European Union, Singapore, and 
Australia, for example, also account for a multi-swap approach to 
the reporting of cleared swaps.
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    The Commission requests comment on whether the ongoing cost savings 
of adopting an alternative rule would justify the one-time costs of 
changing industry practice to conform to the alternative rule.
11. Request for Comment
    The Commission requests comment on all aspects of the proposed 
rules. Beyond specific questions interspersed throughout its 
discussion, the Commission generally requests comment on all aspects of 
its consideration of costs and benefits, including: identification and 
assessment of any costs and benefits not discussed therein; the 
potential costs and benefits of the alternatives that the Commission 
discussed in this release; data and any other information to assist or 
otherwise inform the Commission's ability to quantify or qualitatively 
describe the benefits and costs of the proposed rules; and 
substantiating data, statistics, and any other information to support 
positions posited by commenters with respect to the Commission's 
consideration of costs and benefits. Commenters also may suggest other 
alternatives to the proposed approach where the commenters believe that 
the alternatives would be appropriate under the CEA and provide a 
superior cost-benefit profile.
12. Section 15(a) Factors
    Section 15(a) of the CEA requires the Commission to consider the 
effects of its

[[Page 52571]]

actions in light of the following five factors:
    (1) Protection of market participants and the public. In the Final 
Part 45 Rulemaking,\161\ the Commission stated that the data reporting 
requirements of part 45 provided for protection of market participants 
and the public by providing regulatory agencies with a wealth of 
previously unavailable data in a unified format, greatly enhancing the 
ability of market and systemic risk regulators to perform their 
oversight and enforcement functions.\162\ The Commission preliminarily 
believes that the proposed amendments would enhance these protections 
by explicitly providing how and by whom each of the swaps involved in a 
cleared swap transaction should be reported. In particular, by 
requiring DCOs to electronically report the creation data and 
continuation data for clearing swaps, the Commission believes that data 
on all clearing swaps associated with a specific original swap will be 
aggregated at the same SDR, provided by a single entity and readily 
available for accurate and complete analysis. This would also allow the 
Commission and other regulators to access all data pertaining to 
related clearing swaps from a single SDR. These enhancements should 
allow for efficiencies in oversight and enforcement functions, 
resulting in improved protection of market participants and the public.
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    \161\ 77 FR 2136, Jan. 13, 2012.
    \162\ Id. at 2188.
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    (2) The efficiency, competitiveness and financial integrity of the 
markets. In the Final Part 45 Rulemaking, the Commission stated that 
the swap data reporting requirements of part 45 would enhance the 
financial integrity of swap markets.\163\ The Commission also stated 
that part 45's streamlined reporting regime, including the counterparty 
hierarchy used to select the reporting counterparty, could be 
considered efficient in that it assigns greater reporting 
responsibility to more sophisticated entities more likely to be able to 
realize economies of scale and scope in reporting costs.\164\ The 
Commission preliminarily believes that the proposed amendments may 
further enhance this efficiency by requiring DCOs to report where they 
are the party best equipped to do so.\165\ In addition, by explicitly 
delineating reporting responsibilities associated with each component 
of a cleared swap transaction, the proposed rules should result in 
improved reliability and consistency of the swaps data reported, 
further enhancing the financial integrity of the swap markets.
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    \163\ Id. at 2189.
    \164\ Id.
    \165\ As noted earlier in this release, the Commission's 
understanding is that the DCO is the entity that should have the 
easiest and quickest access to full information with respect to PET 
data and confirmation data for clearing swaps, as well with respect 
to terminations of original swaps.
---------------------------------------------------------------------------

    The rule obligating the reporting counterparty or SEF/DCM to choose 
the SDR for the original intended to be cleared swap may promote 
competition among SDRs. However, the Commission also acknowledges that 
by allowing DCOs to choose the SDR to which they report, competition 
for SDR services would be impacted as a result of some DCOs reporting 
to their affiliated SDR, that is, an SDR that shares the same parent 
company as the DCO. Any such impact on competition would be a 
consequence of business decisions designed to realize costs savings 
associated with the affiliations between DCOs and SDRs. It is 
reasonable to expect that DCOs would continue to report to affiliated 
SDRs under the proposed rules, but nothing in the proposed rules would 
require them to do so. The Commission notes that section 21 of the CEA 
permits a DCO to register as an SDR.
    Additionally, the Commission notes that a significant portion of 
swap activity is reported to non-affiliated SDRs. Sample data from a 
recent representative week suggests that more than 40 percent of 
reported swaps are being reported to non-affiliated SDRs. A sizeable 
portion of the market could thus avoid the competitive impacts 
described above. The Commission requests comment on the extent to which 
a DCO's choice of an affiliated SDR may impact competition, including 
how market share among affiliated and non-affiliated SDRs may increase 
or lessen such an impact on competition.
    (3) Price Discovery. In the Final Part 45 Rulemaking, the 
Commission stated that the swap data reporting requirements of part 45 
did not have a material effect on the price discovery process.\166\ The 
Commission preliminarily believes that the proposed amendments also 
would not have a material effect on price discovery. The Commission 
requests comment on whether the proposed amendments would have any 
effect on price discovery.
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    \166\ 77 FR 2136, 2189, Jan. 13, 2012.
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    (4) Risk Management. In the Final Part 45 Rulemaking, the 
Commission stated that the data reporting requirements of part 45 did 
not have a material effect on sound risk management practices.\167\ The 
Commission preliminarily believes that the proposed amendments also 
would not have a material effect on sound risk management practices. 
The Commission requests comment on whether the proposed amendments 
would have any effect on sound risk management practices.
---------------------------------------------------------------------------

    \167\ Id. at 2189.
---------------------------------------------------------------------------

    (5) Other Public Interest Considerations. In the Final Part 45 
Rulemaking, the Commission stated that the data reporting requirements 
would allow regulators to readily acquire and analyze market data, thus 
streamlining the surveillance process.\168\ The Commission 
preliminarily believes that the proposed amendments would enhance this 
consideration by providing certainty about how and by whom each of the 
swaps involved in a cleared swap transaction should be reported.
---------------------------------------------------------------------------

    \168\ Id.
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    As noted earlier in this release, the multi-swap reporting approach 
proposed in this release is largely consistent with the approaches 
proposed by the SEC and adopted by several foreign regulators. Given 
that the swaps market is global in nature, the Commission anticipates 
that adopting an approach that is consistent with the approaches 
adopted by other regulators may further other public interest 
considerations by reducing compliance costs for entities operating in 
multiple jurisdictions.

D. Antitrust Considerations

    Section 15(b) of the CEA requires the Commission to take into 
consideration the public interest to be protected by the antitrust laws 
and endeavor to take the least anticompetitive means of achieving the 
objectives of the CEA, in issuing any order or adopting any Commission 
rule or regulation.
    The Commission does not anticipate that the proposed amendments to 
part 45 will result in anti-competitive behavior. However, because the 
proposed amendments affect the existing reporting regime and swap 
transaction workflows, the Commission encourages comments from the 
public on any aspect of the proposal that may have the potential to be 
inconsistent with the anti-trust laws or be anti-competitive in nature. 
For example, the Commission is generally concerned with market 
concentration, the vertical integration of registered entities (DCMs, 
SEFs, DCOs, and SDRs), and the use of market power rather than 
competitive forces to determine the success or failure of particular 
SDRs. Accordingly, the Commission requests comment regarding whether 
the proposal in total, or its individual parts, could be deemed anti-
competitive.

[[Page 52572]]

List of Subjects in 17 CFR Part 45

    Data recordkeeping requirements and data reporting requirements, 
Swaps.

    For the reasons stated in the preamble, the Commodity Futures 
Trading Commission proposes to amend 17 CFR part 45 as set forth below:

PART 45--SWAP DATA RECORDKEEPING AND REPORTING REQUIREMENTS

0
1. The authority citation for part 45 is revised to read as follows:

    Authority:  7 U.S.C. 6r, 7, 7a-1, 7b-3, 12a, and 24a, as amended 
by Title VII of the Wall Street Reform and Consumer Protection Act 
of 2010, Pub. L. 111-203, 124 Stat. 1376 (2010), unless otherwise 
noted.

0
2. Amend Sec.  45.1 as follows:
0
a. Add a definition for ``clearing swap'' in alphabetical order;
0
b. Revise the definition of ``derivatives clearing organization''; and
0
c. Add a definition for ``original swap'' in alphabetical order.
    The additions and revisions read as follows:


Sec.  45.1  Definitions.

* * * * *
    Clearing swap means a swap created pursuant to the rules of a 
derivatives clearing organization that has a derivatives clearing 
organization as a counterparty, including any swap that replaces an 
original swap that was extinguished upon acceptance of such original 
swap by the derivatives clearing organization for clearing.
* * * * *
    Derivatives clearing organization means a derivatives clearing 
organization, as defined by Sec.  1.3(d) of this chapter, that is 
registered with the Commission.
* * * * *
    Original swap means a swap that has been accepted for clearing by a 
derivatives clearing organization.
* * * * *
0
3. Revise Sec.  45.3 to read as follows:


Sec.  45.3  Swap data reporting: creation data.

    Registered entities and swap counterparties must report required 
swap creation data electronically to a swap data repository as set 
forth in this section and in the manner provided in Sec.  45.13(b). The 
rules governing acceptance and recording of such data by a swap data 
repository are set forth in Sec.  49.10 of this chapter. The reporting 
obligations of swap counterparties with respect to swaps executed prior 
to the applicable compliance date and in existence on or after July 21, 
2010, the date of enactment of the Dodd-Frank Act, are set forth in 
part 46 of this chapter. This section and Sec.  45.4 establish the 
general swap data reporting obligations of swap dealers, major swap 
participants, non-SD/MSP counterparties, swap execution facilities, 
designated contract markets, and derivatives clearing organizations to 
report swap data to a swap data repository. In addition to the 
reporting obligations set forth in this section and Sec.  45.4, 
registered entities and swap counterparties are subject to other 
reporting obligations set forth in this chapter, including, without 
limitation, the following: Swap dealers, major swap participants, and 
non-SD/MSP counterparties are also subject to the reporting obligations 
with respect to corporate affiliations reporting set forth in Sec.  
45.6; swap execution facilities, designated contract markets, swap 
dealers, major swap participants, and non-SD/MSP counterparties are 
subject to the reporting obligations with respect to real time 
reporting of swap data set forth in part 43 of this chapter; 
counterparties to a swap for which an exception to, or an exemption 
from, the clearing requirement has been elected under part 50 of this 
chapter are subject to the reporting obligations set forth in part 50 
of this chapter; and, where applicable, swap dealers, major swap 
participants, and non-SD/MSP counterparties are subject to the 
reporting obligations with respect to large traders set forth in parts 
17 and 18 of this chapter. Paragraphs (a) through (d) of this section 
apply to all swaps except clearing swaps, while paragraph (e) applies 
only to clearing swaps.
    (a) Swaps executed on or pursuant to the rules of a swap execution 
facility or designated contract market. For each swap executed on or 
pursuant to the rules of a swap execution facility or designated 
contract market, the swap execution facility or designated contract 
market must report all primary economic terms data for the swap, as 
defined in Sec.  45.1, as soon as technologically practicable after 
execution of the swap. If the swap is not intended to be submitted to a 
derivatives clearing organization for clearing at the time of 
execution, the swap execution facility or designated contract market 
must report all confirmation data for the swap, as defined in Sec.  
45.1, as soon as technologically practicable after execution of the 
swap.
    (b) Off-facility swaps subject to the clearing requirement. For all 
off-facility swaps subject to the clearing requirement under part 50 of 
this chapter, except for those off-facility swaps for which an 
exception or exemption from the clearing requirement has been elected 
under part 50 of this chapter, and those off-facility swaps covered by 
CEA section 2(a)(13)(C)(iv), required swap creation data must be 
reported as provided in paragraph (b) of this section.
    (1) The reporting counterparty, as determined pursuant to Sec.  
45.8, must report all primary economic terms data for the swap, within 
the applicable reporting deadline set forth in paragraph (b)(1)(i) or 
(ii) of this section.
    (i) If the reporting counterparty is a swap dealer or a major swap 
participant, the reporting counterparty must report all primary 
economic terms data for the swap as soon as technologically practicable 
after execution, but no later than 15 minutes after execution.
    (ii) If the reporting counterparty is a non-SD/MSP counterparty, 
the reporting counterparty must report all primary economic terms data 
for the swap as soon as technologically practicable after execution, 
but no later than one business hour after execution.
    (2) [Reserved]
    (c) Off-facility swaps not subject to the clearing requirement, 
with a swap dealer or major swap participant reporting counterparty. 
For all off-facility swaps not subject to the clearing requirement 
under part 50 of this chapter, all off-facility swaps for which an 
exception to, or an exemption from, the clearing requirement has been 
elected under part 50 of this chapter, and all off-facility swaps 
covered by CEA section 2(a)(13)(C)(iv), for which a swap dealer or 
major swap participant is the reporting counterparty, required swap 
creation data must be reported as provided in paragraph (c) of this 
section.
    (1) Credit, equity, foreign exchange, and interest rate swaps. For 
each such credit swap, equity swap, foreign exchange instrument, or 
interest rate swap:
    (i) The reporting counterparty, as determined pursuant to Sec.  
45.8, must report all primary economic terms data for the swap, within 
the applicable reporting deadline set forth in paragraph (c)(1)(i)(A) 
or (B) of this section.
    (A) If the non-reporting counterparty is a swap dealer, a major 
swap participant, or a non-SD/MSP counterparty that is a financial 
entity as defined in CEA section 2(h)(7)(C), or if the non-reporting 
counterparty is a non-SD/MSP counterparty that is not a financial 
entity as defined in CEA section 2(h)(7)(C) and verification of primary 
economic terms occurs electronically, then the reporting counterparty 
must report all primary economic terms data for the swap as

[[Page 52573]]

soon as technologically practicable after execution, but no later than 
30 minutes after execution.
    (B) If the non-reporting counterparty is a non-SD/MSP counterparty 
that is not a financial entity as defined in CEA section 2(h)(7)(C), 
and if verification of primary economic terms does not occur 
electronically, then the reporting counterparty must report all primary 
economic terms data for the swap as soon as technologically practicable 
after execution, but no later than 30 minutes after execution.
    (ii) If the swap is not intended to be submitted to a derivatives 
clearing organization for clearing at the time of execution, the 
reporting counterparty must report all confirmation data for the swap, 
as defined in Sec.  45.1, as soon as technologically practicable after 
confirmation, but no later than: 30 minutes after confirmation if 
confirmation occurs electronically; or 24 business hours after 
confirmation if confirmation does not occur electronically.
    (2) Other commodity swaps. For each such other commodity swap:
    (i) The reporting counterparty, as determined pursuant to Sec.  
45.8, must report all primary economic terms data for the swap, within 
the applicable reporting deadline set forth in paragraph (c)(2)(i)(A) 
or (B) of this section.
    (A) If the non-reporting counterparty is a swap dealer, a major 
swap participant, or a non-SD/MSP counterparty that is a financial 
entity as defined in CEA section 2(h)(7)(C), or if the non-reporting 
counterparty is a non-SD/MSP counterparty that is not a financial 
entity as defined in CEA section 2(h)(7)(C) and verification of primary 
economic terms occurs electronically, then the reporting counterparty 
must report all primary economic terms data for the swap as soon as 
technologically practicable after execution, but no later than two 
hours after execution.
    (B) If the non-reporting counterparty is a non-SD/MSP counterparty 
that is not a financial entity as defined in CEA section 2(h)(7)(C), 
and if verification of primary economic terms does not occur 
electronically, then the reporting counterparty must report all primary 
economic terms data for the swap as soon as technologically practicable 
after execution, but no later than two hours after execution.
    (ii) If the swap is not intended to be submitted to a derivatives 
clearing organization for clearing at the time of execution, the 
reporting counterparty must report all confirmation data for the swap, 
as defined in Sec.  45.1, as soon as technologically practicable after 
confirmation, but no later than: 30 minutes after confirmation if 
confirmation occurs electronically; or 24 business hours after 
confirmation if confirmation does not occur electronically.
    (d) Off-facility swaps not subject to the clearing requirement, 
with a non-SD/MSP reporting counterparty. For all off-facility swaps 
not subject to the clearing requirement under part 50 of this chapter, 
all off-facility swaps for which an exception to, or an exemption from, 
the clearing requirement has been elected under part 50 of this 
chapter, and all off-facility swaps covered by CEA section 
2(a)(13)(C)(iv), in all asset classes, for which a non-SD/MSP 
counterparty is the reporting counterparty, required swap creation data 
must be reported as provided in paragraph (d) of this section.
    (1) The reporting counterparty, as determined pursuant to Sec.  
45.8, must report all primary economic terms data for the swap, as soon 
as technologically practicable after execution, but no later than 24 
business hours after execution.
    (2) If the swap is not intended to be submitted to a derivatives 
clearing organization for clearing at the time of execution, the 
reporting counterparty must report all confirmation data for the swap, 
as defined in Sec.  45.1, as soon as technologically practicable after 
confirmation, but no later than 24 business hours after confirmation.
    (e) Clearing swaps. As soon as technologically practicable after 
acceptance of an original swap by a derivatives clearing organization 
for clearing, or as soon as technologically practicable after execution 
of a clearing swap that does not replace an original swap, the 
derivatives clearing organization, as reporting counterparty, must 
report all required swap creation data for the clearing swap. Required 
swap creation data for clearing swaps must include all confirmation 
data and all primary economic terms data, as those terms are defined in 
Sec.  45.1 and as included in appendix 1 to this part.
    (f) Allocations. For swaps involving allocation, required swap 
creation data shall be reported to a single swap data repository as 
follows.
    (1) Initial swap between reporting counterparty and agent. The 
initial swap transaction between the reporting counterparty and the 
agent shall be reported as required by Sec.  45.3(a) through (d). A 
unique swap identifier for the initial swap transaction must be created 
as provided in Sec.  45.5.
    (2) Post-allocation swaps--(i) Duties of the agent. In accordance 
with this section, the agent shall inform the reporting counterparty of 
the identities of the reporting counterparty's actual counterparties 
resulting from allocation, as soon as technologically practicable after 
execution, but not later than eight business hours after execution.
    (ii) Duties of the reporting counterparty. The reporting 
counterparty must report all required swap creation data for each swap 
resulting from allocation to the same swap data repository to which the 
initial swap transaction is reported as soon as technologically 
practicable after it is informed by the agent of the identities of its 
actual counterparties. The reporting counterparty must create a unique 
swap identifier for each such swap as required in Sec.  45.5.
    (iii) Duties of the swap data repository. The swap data repository 
to which the initial swap transaction and the post-allocation swaps are 
reported must map together the unique swap identifiers of the initial 
swap transaction and of each of the post-allocation swaps.
    (g) Multi-asset swaps. For each multi-asset swap, required swap 
creation data and required swap continuation data shall be reported to 
a single swap data repository that accepts swaps in the asset class 
treated as the primary asset class involved in the swap by the swap 
execution facility, designated contract market, or reporting 
counterparty making the first report of required swap creation data 
pursuant to this section. The registered entity or reporting 
counterparty making the first report of required swap creation data 
pursuant to this section shall report all primary economic terms for 
each asset class involved in the swap.
    (h) Mixed swaps. (1) For each mixed swap, required swap creation 
data and required swap continuation data shall be reported to a swap 
data repository registered with the Commission and to a security-based 
swap data repository registered with the Securities and Exchange 
Commission. This requirement may be satisfied by reporting the mixed 
swap to a swap data repository or security-based swap data repository 
registered with both Commissions.
    (2) The registered entity or reporting counterparty making the 
first report of required swap creation data pursuant to this section 
shall ensure that the same unique swap identifier is recorded for the 
swap in both the swap data repository and the security-based swap data 
repository.
    (i) International swaps. For each international swap, the reporting 
counterparty shall report as soon as practicable to the swap data 
repository the identity of the non-U.S. trade

[[Page 52574]]

repository not registered with the Commission to which the swap is also 
reported and the swap identifier used by the non-U.S. trade repository 
to identify the swap. If necessary, the reporting counterparty shall 
obtain this information from the non-reporting counterparty.
    (j) Choice of SDR. The entity with the obligation to choose the 
swap data repository to which all required swap creation data for the 
swap is reported shall be the entity that is required to make the first 
report of all data pursuant to this section, as follows:
    (1) For swaps executed on or pursuant to the rules of a swap 
execution facility or designated contract market, the swap execution 
facility or designated contract market shall choose the swap data 
repository;
    (2) For all other swaps, the reporting counterparty, as determined 
in section 45.8, shall choose the swap data repository.
0
4. Revise Sec.  45.4 to read as follows:


Sec.  45.4  Swap data reporting: continuation data.

    Registered entities and swap counterparties must report required 
swap continuation data electronically to a swap data repository as set 
forth in this section and in the manner provided in Sec.  45.13(b). The 
rules governing acceptance and recording of such data by a swap data 
repository are set forth in Sec.  49.10 of this chapter. The reporting 
obligations of registered entities and swap counterparties with respect 
to swaps executed prior to the applicable compliance date and in 
existence on or after July 21, 2010, the date of enactment of the Dodd-
Frank Act, are set forth in part 46 of this chapter. This section and 
Sec.  45.3 establish the general swap data reporting obligations of 
swap dealers, major swap participants, non-SD/MSP counterparties, swap 
execution facilities, designated contract markets, and derivatives 
clearing organizations to report swap data to a swap data repository. 
In addition to the reporting obligations set forth in this section and 
Sec.  45.3, registered entities and swap counterparties are subject to 
other reporting obligations set forth in this chapter, including, 
without limitation, the following: Swap dealers, major swap 
participants, and non-SD/MSP counterparties are also subject to the 
reporting obligations with respect to corporate affiliations reporting 
set forth in Sec.  45.6; swap execution facilities, designated contract 
markets, swap dealers, major swap participants, and non-SD/MSP 
counterparties are subject to the reporting obligations with respect to 
real time reporting of swap data set forth in part 43 of this chapter; 
and, where applicable, swap dealers, major swap participants, and non-
SD/MSP counterparties are subject to the reporting obligations with 
respect to large traders set forth in parts 17 and 18 of this chapter.
    (a) Continuation data reporting method generally. For each swap, 
regardless of asset class, reporting counterparties and derivatives 
clearing organizations required to report swap continuation data must 
do so in a manner sufficient to ensure that all data in the swap data 
repository concerning the swap remains current and accurate, and 
includes all changes to the primary economic terms of the swap 
occurring during the existence of the swap. Reporting entities and 
counterparties fulfill this obligation by reporting either life cycle 
event data or state data for the swap within the applicable deadlines 
set forth in this section. Reporting counterparties and derivatives 
clearing organizations required to report swap continuation data for a 
swap may fulfill their obligation to report either life cycle event 
data or state data by reporting:
    (1) Life cycle event data to a swap data repository that accepts 
only life cycle event data reporting;
    (2) State data to a swap data repository that accepts only state 
data reporting; or
    (3) Either life cycle event data or state data to a swap data 
repository that accepts both life cycle event data and state data 
reporting.
    (b) Continuation data reporting for clearing swaps. For all 
clearing swaps, required continuation data must be reported as provided 
in this section.
    (1) Life cycle event data or state data reporting. The derivatives 
clearing organization, as reporting counterparty, must report to the 
swap data repository either:
    (i) All life cycle event data for the swap, reported on the same 
day that any life cycle event occurs with respect to the swap; or
    (ii) All state data for the swap, reported daily.
    (2) Valuation data reporting. Valuation data for the swap must be 
reported by the derivatives clearing organization, as reporting 
counterparty, daily.
    (c) Continuation data reporting for original swaps. For all 
original swaps, required continuation data, including terminations, 
must be reported to the swap data repository to which the swap that was 
accepted for clearing was reported pursuant to Sec.  45.3(a) through 
(d) in the manner provided in Sec.  45.13(b) and in this section, and 
must be accepted and recorded by such swap data repository as provided 
in Sec.  49.10 of this chapter.
    (1) Life cycle event data or state data reporting. The derivatives 
clearing organization that accepted the swap for clearing must report 
to the swap data repository either:
    (i) All life cycle event data for the swap, reported on the same 
day that any life cycle event occurs with respect to the swap; or
    (ii) All state data for the swap, reported daily.
    (2) In addition to all other necessary continuation data fields, 
life cycle event data and state data must include all of the following:
    (i) The legal entity identifier of the swap data repository to 
which all required swap creation data for each clearing swap was 
reported by the derivatives clearing organization pursuant to Sec.  
45.3(e);
    (ii) The unique swap identifier of the original swap that was 
replaced by the clearing swaps; and
    (iii) The unique swap identifier of each clearing swap that 
replaces a particular original swap.
    (d) Continuation data reporting for uncleared swaps. For all swaps 
that are not cleared by a derivatives clearing organization, including 
swaps executed on or pursuant to the rules of a swap execution facility 
or designated contract market, the reporting counterparty must report 
all required swap continuation data as provided in this section.
    (1) Life cycle event data or state data reporting. The reporting 
counterparty for the swap must report to the swap data repository 
either all life cycle event data for the swap or all state data for the 
swap, within the applicable deadline set forth in paragraphs (d)(1)(i) 
or (ii) of this section.
    (i) If the reporting counterparty is a swap dealer or major swap 
participant:
    (A) Life cycle event data must be reported on the same day that any 
life cycle event occurs, with the sole exception that life cycle event 
data relating to a corporate event of the non-reporting counterparty 
must be reported no later than the second business day after the day on 
which such event occurs.
    (B) State data must be reported daily.
    (ii) If the reporting counterparty is a non-SD/MSP counterparty:
    (A) Life cycle event data must be reported no later than the end of 
the first business day following the date of any life cycle event; with 
the sole exception that life cycle event data relating to a corporate 
event of the non-reporting counterparty must be reported no later than 
the end of the second business day following such event.

[[Page 52575]]

    (B) State data must be reported daily.
    (2) Valuation data reporting. Valuation data for the swap must be 
reported by the reporting counterparty for the swap as follows:
    (i) If the reporting counterparty is a swap dealer or major swap 
participant, the reporting counterparty must report all valuation data 
for the swap, daily.
    (ii) If the reporting counterparty is a non-SD/MSP counterparty, 
the reporting counterparty must report the current daily mark of the 
transaction as of the last day of each fiscal quarter. This report must 
be transmitted to the swap data repository within 30 calendar days of 
the end of each fiscal quarter. If a daily mark of the transaction is 
not available for the swap, the reporting counterparty satisfies this 
requirement by reporting the current valuation of the swap recorded on 
its books in accordance with applicable accounting standards.
0
5. Revise Sec.  45.5 to read as follows:


Sec.  45.5  Unique swap identifiers.

    Each swap subject to the jurisdiction of the Commission shall be 
identified in all recordkeeping and all swap data reporting pursuant to 
this part by the use of a unique swap identifier, which shall be 
created, transmitted, and used for each swap as provided in paragraphs 
(a) through (f) of this section.
    (a) Swaps executed on or pursuant to the rules of a swap execution 
facility or designated contract market. For each swap executed on or 
pursuant to the rules of a swap execution facility or designated 
contract market, the swap execution facility or designated contract 
market shall create and transmit a unique swap identifier as provided 
in paragraphs (a)(1) and (2) of this section.
    (1) Creation. The swap execution facility or designated contract 
market shall generate and assign a unique swap identifier at, or as 
soon as technologically practicable following, the time of execution of 
the swap, and prior to the reporting of required swap creation data. 
The unique swap identifier shall consist of a single data field that 
contains two components:
    (i) The unique alphanumeric code assigned to the swap execution 
facility or designated contract market by the Commission for the 
purpose of identifying the swap execution facility or designated 
contract market with respect to unique swap identifier creation; and
    (ii) An alphanumeric code generated and assigned to that swap by 
the automated systems of the swap execution facility or designated 
contract market, which shall be unique with respect to all such codes 
generated and assigned by that swap execution facility or designated 
contract market.
    (2) Transmission. The swap execution facility or designated 
contract market shall transmit the unique swap identifier 
electronically as follows:
    (i) To the swap data repository to which the swap execution 
facility or designated contract market reports required swap creation 
data for the swap, as part of that report;
    (ii) To each counterparty to the swap, as soon as technologically 
practicable after execution of the swap;
    (iii) To the derivatives clearing organization, if any, to which 
the swap is submitted for clearing, as part of the required swap 
creation data transmitted to the derivatives clearing organization for 
clearing purposes.
    (b) Off-facility swaps with a swap dealer or major swap participant 
reporting counterparty. For each off-facility swap where the reporting 
counterparty is a swap dealer or major swap participant, the reporting 
counterparty shall create and transmit a unique swap identifier as 
provided in paragraphs (b)(1) and (2) of this section.
    (1) Creation. The reporting counterparty shall generate and assign 
a unique swap identifier as soon as technologically practicable after 
execution of the swap and prior to both the reporting of required swap 
creation data and the transmission of data to a derivatives clearing 
organization if the swap is to be cleared. The unique swap identifier 
shall consist of a single data field that contains two components:
    (i) The unique alphanumeric code assigned to the swap dealer or 
major swap participant by the Commission at the time of its 
registration as such, for the purpose of identifying the swap dealer or 
major swap participant with respect to unique swap identifier creation; 
and
    (ii) An alphanumeric code generated and assigned to that swap by 
the automated systems of the swap dealer or major swap participant, 
which shall be unique with respect to all such codes generated and 
assigned by that swap dealer or major swap participant.
    (2) Transmission. The reporting counterparty shall transmit the 
unique swap identifier electronically as follows:
    (i) To the swap data repository to which the reporting counterparty 
reports required swap creation data for the swap, as part of that 
report;
    (ii) To the non-reporting counterparty to the swap, as soon as 
technologically practicable after execution of the swap; and
    (iii) To the derivatives clearing organization, if any, to which 
the swap is submitted for clearing, as part of the required swap 
creation data transmitted to the derivatives clearing organization for 
clearing purposes.
    (c) Off-facility swaps with a non-SD/MSP reporting counterparty. 
For each off-facility swap for which the reporting counterparty is a 
non-SD/MSP counterparty, the swap data repository to which primary 
economic terms data is reported shall create and transmit a unique swap 
identifier as provided in paragraphs (c)(1) and (2) of this section.
    (1) Creation. The swap data repository shall generate and assign a 
unique swap identifier as soon as technologically practicable following 
receipt of the first report of required swap creation data concerning 
the swap. The unique swap identifier shall consist of a single data 
field that contains two components:
    (i) The unique alphanumeric code assigned to the swap data 
repository by the Commission at the time of its registration as such, 
for the purpose of identifying the swap data repository with respect to 
unique swap identifier creation; and
    (ii) An alphanumeric code generated and assigned to that swap by 
the automated systems of the swap data repository, which shall be 
unique with respect to all such codes generated and assigned by that 
swap data repository.
    (2) Transmission. The swap data repository shall transmit the 
unique swap identifier electronically as follows:
    (i) To the counterparties to the swap, as soon as technologically 
practicable following creation of the unique swap identifier; and
    (ii) To the derivatives clearing organization, if any, to which the 
swap is submitted for clearing, as soon as technologically practicable 
following creation of the unique swap identifier.
    (d) Clearing swaps. For each clearing swap, the derivatives 
clearing organization that is a counterparty to such swap shall create 
and transmit a unique swap identifier as provided in paragraphs (d)(1) 
and (2) of this section.
    (1) Creation. The derivatives clearing organization shall generate 
and assign a unique swap identifier upon, or as soon as technologically 
practicable after, acceptance of an original swap by the derivatives 
clearing organization for clearing or execution of a clearing swap that 
does not replace an original swap, and prior to the reporting of 
required swap creation data for the clearing swap. The unique swap 
identifier shall consist of a single data field that contains two 
components:
    (i) The unique alphanumeric code assigned to the derivatives 
clearing organization by the Commission for the purpose of identifying 
the derivatives

[[Page 52576]]

clearing organization with respect to unique swap identifier creation; 
and
    (ii) An alphanumeric code generated and assigned to that clearing 
swap by the automated systems of the derivatives clearing organization, 
which shall be unique with respect to all such codes generated and 
assigned by that derivatives clearing organization.
    (2) Transmission. The derivatives clearing organization shall 
transmit the unique swap identifier electronically as follows:
    (i) To the swap data repository to which the derivatives clearing 
organization reports required swap creation data for the clearing swap, 
as part of that report; and
    (ii) To its counterparty to the clearing swap, as soon as 
technologically practicable after acceptance of a swap by the 
derivatives clearing organization for clearing or execution of a 
clearing swap that does not replace an original swap.
    (e) Allocations. For swaps involving allocation, unique swap 
identifiers shall be created and transmitted as follows.
    (1) Initial swap between reporting counterparty and agent. The 
unique swap identifier for the initial swap transaction between the 
reporting counterparty and the agent shall be created as required by 
paragraphs (a) through (c) of this section, and shall be transmitted as 
follows:
    (i) If the unique swap identifier is created by a swap execution 
facility or designated contract market, the swap execution facility or 
designated contract market must include the unique swap identifier in 
its swap creation data report to the swap data repository, and must 
transmit the unique identifier to the reporting counterparty and to the 
agent.
    (ii) If the unique swap identifier is created by the reporting 
counterparty, the reporting counterparty must include the unique swap 
identifier in its swap creation data report to the swap data 
repository, and must transmit the unique identifier to the agent.
    (2) Post-allocation swaps. The reporting counterparty must create a 
unique swap identifier for each of the individual swaps resulting from 
allocation, as soon as technologically practicable after it is informed 
by the agent of the identities of its actual counterparties, and must 
transmit each such unique swap identifier to:
    (i) The non-reporting counterparty for the swap in question.
    (ii) The agent.
    (iii) The derivatives clearing organization, if any, to which the 
swap is submitted for clearing, as part of the required swap creation 
data transmitted to the derivatives clearing organization for clearing 
purposes.
    (f) Use. Each registered entity or swap counterparty subject to the 
jurisdiction of the Commission shall include the unique swap identifier 
for a swap in all of its records and all of its swap data reporting 
concerning that swap, from the time it creates or receives the unique 
swap identifier as provided in this section, throughout the existence 
of the swap and for as long as any records are required by the CEA or 
Commission regulations to be kept by that registered entity or 
counterparty concerning the swap, regardless of any life cycle events 
or any changes to state data concerning the swap, including, without 
limitation, any changes with respect to the counterparties to or the 
ownership of the swap. This requirement shall not prohibit the use by a 
registered entity or swap counterparty in its own records of any 
additional identifier or identifiers internally generated by the 
automated systems of the registered entity or swap counterparty, or the 
reporting to a swap data repository, the Commission, or another 
regulator of such internally generated identifiers in addition to the 
reporting of the unique swap identifier.
0
6. Revise Sec.  45.8 to read as follows:


Sec.  45.8  Determination of which counterparty must report.

    The determination of which counterparty is the reporting 
counterparty for all swaps, except clearing swaps, shall be made as 
provided in paragraphs (a) through (h) of this section. The 
determination of which counterparty is the reporting counterparty for 
all clearing swaps shall be made as provided in paragraph (i) of this 
section.
    (a) If only one counterparty is a swap dealer, the swap dealer 
shall be the reporting counterparty.
    (b) If neither counterparty is a swap dealer, and only one 
counterparty is a major swap participant, the major swap participant 
shall be the reporting counterparty.
    (c) If both counterparties are non-SD/MSP counterparties, and only 
one counterparty is a financial entity as defined in CEA section 
2(h)(7)(C), the counterparty that is a financial entity shall be the 
reporting counterparty.
    (d) If both counterparties are swap dealers, or both counterparties 
are major swap participants, or both counterparties are non-SD/MSP 
counterparties that are financial entities as defined in CEA section 
2(h)(7)(C), or both counterparties are non-SD/MSP counterparties and 
neither counterparty is a financial entity as defined in CEA section 
2(h)(7)(C):
    (1) For a swap executed on or pursuant to the rules of a swap 
execution facility or designated contract market, the counterparties 
shall agree which counterparty shall be the reporting counterparty.
    (2) For an off-facility swap, the counterparties shall agree as one 
term of their swap which counterparty shall be the reporting 
counterparty.
    (e) Notwithstanding the provisions of paragraphs (a) through (d) of 
this section, if both counterparties to a swap are non-SD/MSP 
counterparties and only one counterparty is a U.S. person, that 
counterparty shall be the reporting counterparty.
    (f) Notwithstanding the provisions of paragraphs (a) through (e) of 
this section, if neither counterparty to a swap is a U.S. person, but 
the swap is executed on or pursuant to the rules of a swap execution 
facility or designated contract market or otherwise executed in the 
United States, or is cleared by a derivatives clearing organization:
    (1) For such a swap executed on or pursuant to the rules of a swap 
execution facility or designated contract market, the counterparties 
shall agree which counterparty shall be the reporting counterparty.
    (2) For an off-facility swap, the counterparties shall agree as one 
term of their swap which counterparty shall be the reporting 
counterparty.
    (g) If a reporting counterparty selected pursuant to paragraphs (a) 
through (f) of this section ceases to be a counterparty to a swap due 
to an assignment or novation, the reporting counterparty for reporting 
of required swap continuation data following the assignment or novation 
shall be selected from the two current counterparties as provided in 
paragraphs (g)(1) through (4) of this section.
    (1) If only one counterparty is a swap dealer, the swap dealer 
shall be the reporting counterparty and shall fulfill all counterparty 
reporting obligations.
    (2) If neither counterparty is a swap dealer, and only one 
counterparty is a major swap participant, the major swap participant 
shall be the reporting counterparty and shall fulfill all counterparty 
reporting obligations.
    (3) If both counterparties are non-SD/MSP counterparties, and only 
one counterparty is a U.S. person, that counterparty shall be the 
reporting counterparty and shall fulfill all counterparty reporting 
obligations.
    (4) In all other cases, the counterparty that replaced the previous 
reporting counterparty by reason of the assignment or novation shall be 
the reporting counterparty, unless otherwise agreed by the 
counterparties.

[[Page 52577]]

    (h) For all swaps executed on or pursuant to the rules of a swap 
execution facility or designated contract market, the rules of the swap 
execution facility or designated contract market must require each swap 
counterparty to provide sufficient information to the swap execution 
facility or designated contract market to enable the swap execution 
facility or designated contract market to report all swap creation data 
as provided in this part.
    (1) To achieve this, the rules of the swap execution facility or 
designated contract market must require each market participant placing 
an order with respect to any swap traded on the swap execution facility 
or designated contract market to include in the order, without 
limitation:
    (i) The legal entity identifier of the market participant placing 
the order.
    (ii) A yes/no indication of whether the market participant is a 
swap dealer with respect to the product with respect to which the order 
is placed.
    (iii) A yes/no indication of whether the market participant is a 
major swap participant with respect to the product with respect to 
which the order is placed.
    (iv) A yes/no indication of whether the market participant is a 
financial entity as defined in CEA section 2(h)(7)(C).
    (v) A yes/no indication of whether the market participant is a U.S. 
person.
    (vi) If applicable, an indication that the market participant will 
elect an exception to, or an exemption from, the clearing requirement 
under part 50 of this chapter for any swap resulting from the order.
    (vii) If the swap will be allocated:
    (A) An indication that the swap will be allocated.
    (B) The legal entity identifier of the agent.
    (C) An indication of whether the swap is a post-allocation swap.
    (D) If the swap is a post-allocation swap, the unique swap 
identifier of the initial swap transaction between the reporting 
counterparty and the agent.
    (2) To achieve this, the swap execution facility or designated 
contract market must use the information obtained pursuant to paragraph 
(h)(1) of this section to identify the counterparty that is the 
reporting counterparty pursuant to the CEA and this section.
    (i) Clearing swaps. Notwithstanding the provisions of paragraphs 
(a) through (h) of this section, if the swap is a clearing swap, the 
derivatives clearing organization that is a counterparty to such swap 
shall be the reporting counterparty and shall fulfill all reporting 
counterparty obligations for such swap.
0
7. Revise Sec.  45.10 to read as follows:


Sec.  45.10  Reporting to a single swap data repository.

    All swap data for a given swap, which shall include all swap data 
required to be reported pursuant to parts 43 and 45 of this chapter, 
must be reported to a single swap data repository, which shall be the 
swap data repository to which the first report of required swap 
creation data is made pursuant to this part.
    (a) Swaps executed on or pursuant to the rules of a swap execution 
facility or designated contract market. To ensure that all swap data, 
including all swap data required to be reported pursuant to parts 43 
and 45 of this chapter, for a swap executed on or pursuant to the rules 
of a swap execution facility or designated contract market is reported 
to a single swap data repository:
    (1) The swap execution facility or designated contract market that 
reports required swap creation data as required by Sec.  45.3 shall 
report all such data to a single swap data repository. As soon as 
technologically practicable after execution, the swap execution 
facility or designated contract market shall transmit to both 
counterparties to the swap, and to the derivatives clearing 
organization, if any, that will clear the swap, both:
    (i) The identity of the swap data repository to which required swap 
creation data is reported by the swap execution facility or designated 
contract market; and
    (ii) The unique swap identifier for the swap, created pursuant to 
Sec.  45.5.
    (2) Thereafter, all required swap creation data and all required 
swap continuation data reported for the swap reported by any registered 
entity or counterparty shall be reported to that same swap data 
repository (or to its successor in the event that it ceases to operate, 
as provided in part 49 of this chapter).
    (b) Off-facility swaps with a swap dealer or major swap participant 
reporting counterparty. To ensure that all swap data, including all 
swap data required to be reported pursuant to parts 43 and 45 of this 
chapter, for off-facility swaps with a swap dealer or major swap 
participant reporting counterparty is reported to a single swap data 
repository:
    (1) If the reporting counterparty reports primary economic terms 
data to a swap data repository as required by Sec.  45.3:
    (i) The reporting counterparty shall report primary economic terms 
data to a single swap data repository.
    (ii) As soon as technologically practicable after execution, but no 
later than as required pursuant to Sec.  45.3, the reporting 
counterparty shall transmit to the other counterparty to the swap both 
the identity of the swap data repository to which primary economic 
terms data is reported by the reporting counterparty, and the unique 
swap identifier for the swap created pursuant to Sec.  45.5.
    (iii) If the swap will be cleared, the reporting counterparty shall 
transmit to the derivatives clearing organization at the time the swap 
is submitted for clearing both the identity of the swap data repository 
to which primary economic terms data is reported by the reporting 
counterparty, and the unique swap identifier for the swap created 
pursuant to Sec.  45.5.
    (2) Thereafter, all required swap creation data and all required 
swap continuation data reported for the swap, by any registered entity 
or counterparty, shall be reported to the swap data repository to which 
swap data has been reported pursuant to paragraph (b)(1) or (2) of this 
section (or to its successor in the event that it ceases to operate, as 
provided in part 49 of this chapter).
    (c) Off-facility swaps with a non-SD/MSP reporting counterparty. To 
ensure that all swap data, including all swap data required to be 
reported pursuant to parts 43 and 45 of this chapter, for such swaps is 
reported to a single swap data repository:
    (1) If the reporting counterparty reports primary economic terms 
data to a swap data repository as required by Sec.  45.3:
    (i) The reporting counterparty shall report primary economic terms 
data to a single swap data repository.
    (ii) As soon as technologically practicable after execution, but no 
later than as required pursuant to Sec.  45.3, the reporting 
counterparty shall transmit to the other counterparty to the swap the 
identity of the swap data repository to which primary economic terms 
data was reported by the reporting counterparty.
    (iii) If the swap will be cleared, the reporting counterparty shall 
transmit to the derivatives clearing organization at the time the swap 
is submitted for clearing the identity of the swap data repository to 
which primary economic terms data was reported by the reporting 
counterparty.
    (2) The swap data repository to which the swap is reported as 
provided in paragraph (c) of this section shall transmit the unique 
swap identifier created pursuant to Sec.  45.5 to both counterparties 
and to the derivatives clearing organization, if any, as soon as

[[Page 52578]]

technologically practicable after creation of the unique swap 
identifier.
    (3) Thereafter, all required swap creation data and all required 
swap continuation data reported for the swap, by any registered entity 
or counterparty, shall be reported to the swap data repository to which 
swap data has been reported pursuant to paragraph (c)(1) of this 
section (or to its successor in the event that it ceases to operate, as 
provided in part 49 of this chapter).
    (d) Clearing swaps. To ensure that all swap data for a given 
clearing swap, and for clearing swaps that replace a particular 
original swap or that are created upon execution of the same 
transaction and that do not replace an original swap, is reported to a 
single swap data repository:
    (1) The derivatives clearing organization that is a counterparty to 
such clearing swap shall report all required swap creation data for 
that clearing swap to a single swap data repository. As soon as 
technologically practicable after acceptance of an original swap by a 
derivatives clearing organization for clearing or execution of a 
clearing swap that does not replace an original swap, the derivatives 
clearing organization shall transmit to the counterparty to each 
clearing swap the legal entity identifier of the swap data repository 
to which the derivatives clearing organization reported the required 
swap creation data for that clearing swap.
    (2) Thereafter, all required swap creation data and all required 
swap continuation data reported for that clearing swap shall be 
reported by the derivatives clearing organization to the swap data 
repository to which swap data has been reported pursuant to paragraph 
(d)(1) of this section (or to its successor in the event that it ceases 
to operate, as provided in part 49 of this chapter).
    (3) For clearing swaps that replace a particular original swap, and 
for equal and opposite clearing swaps that are created upon execution 
of the same transaction and that do not replace an original swap, the 
derivatives clearing organization shall report all required swap 
creation data and all required swap continuation data for such clearing 
swaps to a single swap data repository.
0
8. Revise appendix 1 to part 45 to read as follows:

Appendix 1 to Part 45--Tables of Minimum Primary Economic Terms Data

 Exhibit A--Minimum Primary Economic Terms Data--Credit Swaps and Equity
                                  Swaps
             [Enter N/A for fields that are not applicable]
------------------------------------------------------------------------
   Data categories and fields for all
                 swaps                               Comment
------------------------------------------------------------------------
Asset Class............................  Field values: credit, equity,
                                          FX, rates, other commodity.
The Unique Swap Identifier for the swap  As provided in Sec.   45.5.
The Legal Entity Identifier of the       As provided in Sec.   45.6, or
 reporting counterparty.                  substitute identifier for a
                                          natural person.
An indication of whether the reporting   Yes/No.
 counterparty is a swap dealer with
 respect to the swap.
An indication of whether the reporting   Yes/No.
 counterparty is a major swap
 participant with respect to the swap.
If the reporting counterparty is not a   Yes/No.
 swap dealer or a major swap
 participant with respect to the swap,
 an indication of whether the reporting
 counterparty is a financial entity as
 defined in CEA section 2(h)(7)(C).
An indication of whether the reporting   Yes/No.
 counterparty is a derivatives clearing
 organization with respect to the swap.
An indication of whether the reporting   Yes/No.
 counterparty is a U.S. person.
An indication that the swap will be      Yes/No.
 allocated.
If the swap will be allocated, or is a   As provided in Sec.   45.6, or
 post-allocation swap, the Legal Entity   substitute identifier for a
 Identifier of the agent.                 natural person.
An indication that the swap is a post-   Yes/No.
 allocation swap.
If the swap is a post-allocation swap,   As provided in Sec.   45.5.
 the unique swap identifier of the
 initial swap transaction between the
 reporting counterparty and the agent.
The Legal Entity Identifier of the non-  As provided in Sec.   45.6, or
 reporting party.                         substitute identifier for a
                                          natural person.
An indication of whether the non-        Yes/No.
 reporting counterparty is a swap
 dealer with respect to the swap.
An indication of whether the non-        Yes/No.
 reporting counterparty is a major swap
 participant with respect to the swap.
If the non-reporting counterparty is     Yes/No.
 not a swap dealer or a major swap
 participant with respect to the swap,
 an indication of whether the non-
 reporting counterparty is a financial
 entity as defined in CEA section
 2(h)(7)(C).
An indication of whether the non-        Yes/No.
 reporting counterparty is a U.S.
 person.
The Unique Product Identifier assigned   As provided in Sec.   45.7.
 to the swap.
If no Unique Product Identifier is       ...............................
 available for the swap because the
 swap is not sufficiently standardized,
 the taxonomic description of the swap
 pursuant to the CFTC-approved product
 classification system.
If no CFTC-approved UPI and product      ...............................
 classification system is yet
 available, the internal product
 identifier or product description used
 by the swap data repository.
An indication that the swap is a multi-  Field values: Yes, Not
 asset swap.                              applicable.
For a multi-asset class swap, an         Generally, the asset class
 indication of the primary asset class.   traded by the desk trading the
                                          swap for the reporting
                                          counterparty. Field values:
                                          credit, equity, FX, interest
                                          rate, other commodity.
For a multi-asset class swap, an         Field values: credit, equity,
 indication of the secondary asset        FX, interest rate, other
 class(es).                               commodity.

[[Page 52579]]

 
An indication that the swap is a mixed   Field values: Yes, Not
 swap.                                    applicable.
For a mixed swap reported to two non-    Field value: LEI of the other
 dually- registered swap data             SDR to which the swap is or
 repositories, the identity of the        will be reported.
 other swap data repository (if any) to
 which the swap is or will be reported.
An indication of the counterparty        Field values: LEI, or
 purchasing protection.                   substitute identifier for a
                                          natural person.
An indication of the counterparty        Field values: LEI, or
 selling protection.                      substitute identifier for a
                                          natural person.
Information identifying the reference    The entity that is the subject
 entity.                                  of the protection being
                                          purchased and sold in the
                                          swap. Field values: LEI, or
                                          substitute identifier for a
                                          natural person.
Contract type..........................  E.g., swap, swaption, forward,
                                          option, basis swap, index
                                          swap, basket swap.
Block trade indicator..................  Indication (Yes/No) of whether
                                          the swap qualifies as a block
                                          trade or large notional swap.
Execution timestamp....................  The date and time of the trade,
                                          expressed using Coordinated
                                          Universal Time (``UTC'').
Execution venue........................  The swap execution facility or
                                          designated contract market on
                                          or pursuant to the rules of
                                          which the swap was executed.
                                          Field values: LEI of the swap
                                          execution facility or
                                          designated contract market, or
                                          ``off-facility'' if not so
                                          executed.
Start date.............................  The date on which the swap
                                          starts or goes into effect.
Maturity, termination or end date......  The date on which the swap
                                          expires.
The price..............................  E.g., strike price, initial
                                          price, spread.
The notional amount, and the currency    ...............................
 in which the notional amount is
 expressed.
The amount and currency (or currencies)  ...............................
 of any up-front payment.
Payment frequency of the reporting       A description of the payment
 counterparty.                            stream of the reporting
                                          counterparty, e.g., coupon.
Payment frequency of the non-reporting   A description of the payment
 counterparty.                            stream of the non-reporting
                                          counterparty, e.g., coupon.
Timestamp for submission to swap data    Time and date of submission to
 repository.                              the swap data repository,
                                          expressed using UTC, as
                                          recorded by an automated
                                          system where available, or as
                                          recorded manually where an
                                          automated system is not
                                          available.
Clearing indicator.....................  Yes/No indication of whether
                                          the swap will be submitted for
                                          clearing to a derivatives
                                          clearing organization.
Clearing venue.........................  LEI of the derivatives clearing
                                          organization.
If the swap will not be cleared, an      Yes/No.
 indication of whether an exception to,
 or an exemption from, the clearing
 requirement has been elected with
 respect to the swap under part 50 of
 this chapter.
The identity of the counterparty         Field values: LEI, or
 electing an exception or exemption to    substitute identifier for
 the clearing requirement under part 50   natural person.
 of this chapter.
Clearing exception or exemption type...  The type of clearing exception
                                          or exemption being claimed.
                                          Field values: End user, Inter-
                                          affiliate or Cooperative.
Indication of collateralization........  Is the swap collateralized, and
                                          if so to what extent? Field
                                          values: Uncollateralized,
                                          partially collateralized, one-
                                          way collateralized, fully
                                          collateralized.
Any other term(s) of the swap matched    Use as many fields as required
 or affirmed by the counterparties in     to report each such term.
 verifying the swap.
------------------------------------------------------------------------


 Exhibit A--Minimum Primary Economic Terms Data--Credit Swaps and Equity
                                  Swaps
             [Enter N/A for fields that are not applicable]
------------------------------------------------------------------------
 Additional data categories and fields
           for clearing swaps                        Comment
------------------------------------------------------------------------
Clearing swap USIs.....................  The USIs of each clearing swap
                                          that replaces the original
                                          swap that was submitted for
                                          clearing to the DCO, other
                                          than the USI for which the PET
                                          data is currently being
                                          reported (as ``USI'' field
                                          above).
Original swap USI......................  The USI of the original swap
                                          submitted for clearing to the
                                          DCO that is replaced by
                                          clearing swaps.
Original swap SDR......................  LEI of SDR to which the
                                          original swap was reported.
Clearing member LEI....................  LEI of Clearing member.
Clearing member client account.........  Clearing member client account
                                          number.
Origin (house or customer).............  An indication whether the
                                          clearing member acted as
                                          principal for a house trade or
                                          agent for a customer trade.
Clearing receipt timestamp.............  The date and time at which the
                                          DCO received the original swap
                                          for clearing, expressed using
                                          UTC.
Clearing acceptance timestamp..........  The date and time at which the
                                          DCO accepted the original swap
                                          for clearing, expressed using
                                          UTC.
------------------------------------------------------------------------


[[Page 52580]]


    Exhibit B--Minimum Primary Economic Terms Data--Foreign Exchange
             Transactions (Other Than Cross-Currency Swaps)
             [Enter N/A for fields that are not applicable]
------------------------------------------------------------------------
       Data fields for all swaps                     Comments
------------------------------------------------------------------------
Asset Class............................  Field values: credit, equity,
                                          FX, rates, other commodity.
The Unique Swap Identifier for the swap  As provided in Sec.   45.5.
The Legal Entity Identifier of the       As provided in Sec.   45.6, or
 reporting counterparty.                  substitute identifier for a
                                          natural person.
An indication of whether the reporting   Yes/No.
 counterparty is a swap dealer with
 respect to the swap.
An indication of whether the reporting   Yes/No.
 counterparty is a major swap
 participant with respect to the swap.
If the reporting counterparty is not a   Yes/No.
 swap dealer or a major swap
 participant with respect to the swap,
 an indication of whether the reporting
 counterparty is a financial entity as
 defined in CEA section 2(h)(7)(C).
An indication of whether the reporting   Yes/No.
 counterparty is a derivatives clearing
 organization with respect to the swap.
An indication of whether the reporting   Yes/No.
 counterparty is a U.S. person.
An indication that the swap will be      Yes/No.
 allocated.
If the swap will be allocated, or is a   As provided in Sec.   45.6, or
 post-allocation swap, the Legal Entity   substitute identifier for a
 Identifier of the agent.                 natural person.
An indication that the swap is a post-   Yes/No.
 allocation swap.
If the swap is a post-allocation swap,   As provided in Sec.   45.5.
 the unique swap identifier of the
 initial swap transaction between the
 reporting counterparty and the agent.
The Legal Entity Identifier of the non-  As provided in Sec.   45.6, or
 reporting party.                         substitute identifier for a
                                          natural person.
An indication of whether the non-        Yes/No.
 reporting counterparty is a swap
 dealer with respect to the swap.
An indication of whether the non-        Yes/No.
 reporting counterparty is a major swap
 participant with respect to the swap.
If the non-reporting counterparty is     Yes/No.
 not a swap dealer or a major swap
 participant with respect to the swap,
 an indication of whether the non-
 reporting counterparty is a financial
 entity as defined in CEA section
 2(h)(7)(C).
An indication of whether the non-        Yes/No.
 reporting counterparty is a U.S.
 person.
The Unique Product Identifier assigned   As provided in Sec.   45.7.
 to the swap.
If no Unique Product Identifier is       ...............................
 available for the swap because the
 swap is not sufficiently standardized,
 the taxonomic description of the swap
 pursuant to the CFTC-approved product
 classification system.
If no CFTC-approved UPI and product      ...............................
 classification system is yet
 available, the internal product
 identifier or product description used
 by the swap data repository.
An indication that the swap is a multi-  Field values: Yes, Not
 asset swap.                              applicable.
For a multi-asset class swap, an         Generally, the asset class
 indication of the primary asset class.   traded by the desk trading the
                                          swap for the reporting
                                          counterparty. Field values:
                                          credit, equity, FX, interest
                                          rate, other commodity.
For a multi-asset class swap, an         Field values: credit, equity,
 indication of the secondary asset        FX, interest rate, other
 class(es).                               commodity.
An indication that the swap is a mixed   Field values: Yes, Not
 swap.                                    applicable.
For a mixed swap reported to two non-    Field value: LEI of the other
 dually- registered swap data             SDR to which the swap is or
 repositories, the identity of the        will be reported.
 other swap data repository (if any) to
 which the swap is or will be reported.
Contract type..........................  E.g., forward, non-deliverable
                                          forward (NDF), non-
                                          deliverable option (NDO),
                                          vanilla option, simple exotic
                                          option, complex exotic option.
Block trade indicator..................  Indication (Yes/No) of whether
                                          the swap qualifies as a block
                                          trade or large notional swap.
Execution timestamp....................  The date and time of the trade,
                                          expressed using Coordinated
                                          Universal Time (``UTC'').
Execution venue........................  The swap execution facility or
                                          designated contract market on
                                          or pursuant to the rules of
                                          which the swap was executed.
                                          Field values: LEI of the swap
                                          execution facility or
                                          designated contract market, or
                                          ``off-facility'' if not so
                                          executed.
Currency 1.............................  ISO code.
Currency 2.............................  ISO code.
Notional amount 1......................  For currency 1.
Notional amount 2......................  For currency 2.
Exchange rate..........................  Contractual rate of exchange of
                                          the currencies.
Delivery type..........................  Physical (deliverable) or cash
                                          (non-deliverable).
Settlement or expiration date..........  Settlement date, or for an
                                          option the contract expiration
                                          date.

[[Page 52581]]

 
Timestamp for submission to swap data    Time and date of submission to
 repository.                              the swap data repository,
                                          expressed using Coordinated
                                          Universal Time (``UTC''), as
                                          recorded by an automated
                                          system where available, or as
                                          recorded manually where an
                                          automated system is not
                                          available.
Clearing indicator.....................  Yes/No indication of whether
                                          the swap will be submitted for
                                          clearing to a derivatives
                                          clearing organization.
Clearing venue.........................  LEI of the derivatives clearing
                                          organization.
If the swap will not be cleared, an      Yes/No.
 exception to, or an exemption from,
 the clearing requirement has been
 elected with respect to the swap under
 part 50 of this chapter.
The identity of the counterparty         Field values: LEI, or
 electing an exception or exemption to    substitute identifier, for a
 the clearing requirement under part 50   natural person.
 of this chapter.
Clearing exception or exemption type...  The type of clearing exception
                                          or exemption being claimed.
                                          Field values: End user, Inter-
                                          affiliate or Cooperative.
Indication of collateralization........  Is the trade collateralized,
                                          and if so to what extent?
                                          Field values:
                                          Uncollateralized, partially
                                          collateralized, one-way
                                          collateralized, fully
                                          collateralized.
Any other term(s) of the trade matched   E.g., for options, premium,
 or affirmed by the counterparties in     premium currency, premium
 verifying the trade.                     payment date; for non-
                                          deliverable trades, settlement
                                          currency, valuation (fixing)
                                          date; indication of the
                                          economic obligations of the
                                          counterparties. Use as many
                                          fields as required to report
                                          each such term.
------------------------------------------------------------------------


    Exhibit B--Minimum Primary Economic Terms Data--Foreign Exchange
             Transactions (Other Than Cross-Currency Swaps)
             [Enter N/A for fields that are not applicable]
------------------------------------------------------------------------
 Additional data categories and fields
           for clearing swaps                        Comment
------------------------------------------------------------------------
Clearing swap USIs.....................  The USIs of each clearing swap
                                          that replaces the original
                                          swap that was submitted for
                                          clearing to the DCO, other
                                          than the USI for which the PET
                                          data is currently being
                                          reported (as ``USI'' field
                                          above).
Original swap USI......................  The USI of the original swap
                                          submitted for clearing to the
                                          DCO that is replaced by
                                          clearing swaps.
Original swap SDR......................  LEI of SDR to which the
                                          original swap was reported.
Clearing member LEI....................  LEI of Clearing member.
Clearing member client account.........  Clearing member client account
                                          number.
Origin (house or customer).............  An indication whether the
                                          clearing member acted as
                                          principal for a house trade or
                                          agent for a customer trade.
Clearing receipt timestamp.............  The date and time at which the
                                          DCO received the original swap
                                          for clearing, expressed using
                                          UTC.
Clearing acceptance timestamp..........  The date and time at which the
                                          DCO accepted the original swap
                                          for clearing, expressed using
                                          UTC.
------------------------------------------------------------------------


   Exhibit C--Minimum Primary Economic Terms Data--Interest Rate Swaps
                    (Including Cross-Currency Swaps)
             [Enter N/A for fields that are not applicable]
------------------------------------------------------------------------
       Data fields for all swaps                     Comment
------------------------------------------------------------------------
Asset Class............................  Field values: credit, equity,
                                          FX, rates, other commodity.
The Unique Swap Identifier for the swap  As provided in Sec.   45.5.
The Legal Entity Identifier of the       As provided in Sec.   45.6, or
 reporting counterparty.                  substitute identifier for a
                                          natural person.
An indication of whether the reporting   Yes/No.
 counterparty is a swap dealer with
 respect to the swap.
An indication of whether the reporting   Yes/No.
 counterparty is a major swap
 participant with respect to the swap.
If the reporting counterparty is not a   Yes/No.
 swap dealer or a major swap
 participant with respect to the swap,
 an indication of whether the reporting
 counterparty is a financial entity as
 defined in CEA section 2(h)(7)(C).
An indication of whether the reporting   Yes/No.
 counterparty is a derivatives clearing
 organization with respect to the swap.
An indication of whether the reporting   Yes/No.
 counterparty is a U.S. person.
An indication that the swap will be      Yes/No.
 allocated.

[[Page 52582]]

 
If the swap will be allocated, or is a   As provided in Sec.   45.6, or
 post-allocation swap, the Legal Entity   substitute identifier for a
 Identifier of the agent.                 natural person.
An indication that the swap is a post-   Yes/No.
 allocation swap.
If the swap is a post-allocation swap,   As provided in Sec.   45.5.
 the unique swap identifier of the
 initial swap transaction between the
 reporting counterparty and the agent.
The Legal Entity Identifier of the non-  As provided in Sec.   45.6, or
 reporting counterparty.                  substitute identifier for a
                                          natural person.
An indication of whether the non-        Yes/No.
 reporting counterparty is a swap
 dealer with respect to the swap.
An indication of whether the non-        Yes/No.
 reporting counterparty is a major swap
 participant with respect to the swap.
If the non-reporting counterparty is     Yes/No.
 not a swap dealer or a major swap
 participant with respect to the swap,
 an indication of whether the non-
 reporting counterparty is a financial
 entity as defined in CEA section
 2(h)(7)(C).
An indication of whether the non-        Yes/No.
 reporting counterparty is a U.S.
 person.
The Unique Product Identifier assigned   As provided in Sec.   45.7.
 to the swap.
If no Unique Product Identifier is
 available for the swap because the
 swap is not sufficiently standardized,
 the taxonomic description of the swap
 pursuant to the CFTC-approved product
 classification system.
If no CFTC-approved UPI and product
 classification system is yet
 available, the internal product
 identifier or product description used
 by the swap data repository.
An indication that the swap is a multi-  Field values: Yes, Not
 asset swap.                              applicable.
For a multi-asset class swap, an         Generally, the asset class
 indication of the primary asset class.   traded by the desk trading the
                                          swap for the reporting
                                          counterparty. Field values:
                                          credit, equity, FX, interest
                                          rate, other commodity.
For a multi-asset class swap, an         Field values: credit, equity,
 indication of the secondary asset        FX, interest rate, other
 class(es).                               commodity.
An indication that the swap is a mixed   Field values: Yes, Not
 swap.                                    applicable.
For a mixed swap reported to two non-    Field value: LEI of the other
 dually- registered swap data             SDR to which the swap is or
 repositories, the identity of the        will be reported.
 other swap data repository (if any) to
 which the swap is or will be reported.
Contract type..........................  E.g., swap, swaption, option,
                                          basis swap, index swap.
Block trade indicator..................  Indication (Yes/No) of whether
                                          the swap qualifies as a block
                                          trade or large notional swap.
Execution timestamp....................  The date and time of the trade,
                                          expressed using Coordinated
                                          Universal Time (``UTC'').
Execution venue........................  The swap execution facility or
                                          designated contract market on
                                          or pursuant to the rules of
                                          which the swap was executed.
                                          Field values: LEI of the swap
                                          execution facility or
                                          designated contract market, or
                                          ``off-facility'' if not so
                                          executed.
Start date.............................  The date on which the swap
                                          starts or goes into effect.
Maturity, termination or end date......  The date on which the swap
                                          expires or ends.
Day count convention...................
Notional amount (leg 1)................  The current active notional
                                          amount.
Notional currency (leg 1)..............  ISO code.
Notional amount (leg 2)................  The current active notional
                                          amount.
Notional currency (leg 2)..............  ISO code.
Payer (fixed rate).....................  Is the reporting party a fixed
                                          rate payer? Yes/No/Not
                                          applicable.
Payer (floating rate leg 1)............  If two floating legs, the payer
                                          for leg 1.
Payer (floating rate leg 2)............  If two floating legs, the payer
                                          for leg 2.
Direction..............................  For swaps: whether the
                                          principal is paying or
                                          receiving the fixed rate. For
                                          float-to-float and fixed-to-
                                          fixed swaps: indicate N/A.
                                         For non-swap instruments and
                                          swaptions: indicate the
                                          instrument that was bought or
                                          sold.
Option type............................  E.g., put, call, straddle.
Fixed rate.............................
Fixed rate day count fraction..........  E.g., actual 360.
Floating rate payment frequency........
Floating rate reset frequency..........
Floating rate index name/rate period...  E.g., USD-Libor-BBA.
Timestamp for submission to swap data    Time and date of submission to
 repository.                              the swap data repository,
                                          expressed using UTC, as
                                          recorded by an automated
                                          system where available, or as
                                          recorded manually where an
                                          automated system is not
                                          available.
Clearing indicator.....................  Yes/No indication of whether
                                          the swap will be submitted for
                                          clearing to a derivatives
                                          clearing organization.
Clearing venue.........................  LEI of the derivatives clearing
                                          organization.

[[Page 52583]]

 
If the swap will not be cleared, an      Yes/No.
 indication of whether an exception to,
 or an exemption from, the clearing
 requirement has been elected with
 respect to the swap under part 50 of
 this chapter.
The identity of the counterparty         Field values: LEI, or
 electing an exception or exemption to    substitute identifier, for a
 the clearing requirement under part 50   natural person.
 of this chapter.
Clearing exception or exemption type...  The type of clearing exception
                                          or exemption being claimed.
                                          Field values: End user, Inter-
                                          affiliate or Cooperative.
Indication of collateralization........  Is the swap collateralized, and
                                          if so to what extent? Field
                                          values: Uncollateralized,
                                          partially collateralized, one-
                                          way collateralized, fully
                                          collateralized.
Any other term(s) of the swap matched    E.g., early termination option
 or affirmed by the counterparties in     clause. Use as many fields as
 verifying the swap.                      required to report each such
                                          term.
------------------------------------------------------------------------


   Exhibit C--Minimum Primary Economic Terms Data--Interest Rate Swaps
                    (Including Cross-Currency Swaps)
             [Enter N/A for fields that are not applicable]
------------------------------------------------------------------------
 Additional data categories and fields
           for clearing swaps                        Comment
------------------------------------------------------------------------
Clearing swap USIs.....................  The USIs of each clearing swap
                                          that replaces the original
                                          swap that was submitted for
                                          clearing to the DCO, other
                                          than the USI for which the PET
                                          data is currently being
                                          reported (as ``USI'' field
                                          above).
Original swap USI......................  The USI of the original swap
                                          submitted for clearing to the
                                          DCO that is replaced by
                                          clearing swaps.
Original swap SDR......................  LEI of SDR to which the
                                          original swap was reported.
Clearing member LEI....................  LEI of Clearing member.
Clearing member client acct............  Clearing member client account
                                          number.
Origin (house or customer).............  An indication whether the
                                          clearing member acted as
                                          principal for a house trade or
                                          agent for a customer trade.
Clearing receipt timestamp.............  The date and time at which the
                                          DCO received the original swap
                                          for clearing, expressed using
                                          UTC.
Clearing acceptance timestamp..........  The date and time at which the
                                          DCO accepted the original swap
                                          for clearing, expressed using
                                          UTC.
------------------------------------------------------------------------


  Exhibit D--Minimum Primary Economic Terms Data--Other Commodity Swaps
             [Enter N/A for fields that are not applicable]
------------------------------------------------------------------------
        Data field for all swaps                     Comment
------------------------------------------------------------------------
Asset Class............................  Field values: credit, equity,
                                          FX, rates, other commodity.
The Unique Swap Identifier for the swap  As provided in Sec.   45.5.
The Legal Entity Identifier of the       As provided in Sec.   45.6, or
 reporting counterparty.                  substitute identifier for a
                                          natural person.
An indication of whether the reporting   Yes/No.
 counterparty is a swap dealer with
 respect to the swap.
An indication of whether the reporting   Yes/No.
 counterparty is a major swap
 participant with respect to the swap.
If the reporting counterparty is not a   Yes/No.
 swap dealer or a major swap
 participant with respect to the swap,
 an indication of whether the reporting
 counterparty is a financial entity as
 defined in CEA section 2(h)(7)(C).
An indication of whether the reporting   Yes/No.
 counterparty is a derivatives clearing
 organization with respect to the swap.
An indication of whether the reporting   Yes/No.
 counterparty is a U.S. person.
An indication that the swap will be      Yes/No.
 allocated.
If the swap will be allocated, or is a   As provided in Sec.   45.6, or
 post-allocation swap, the Legal Entity   substitute identifier for a
 Identifier of the agent.                 natural person.
An indication that the swap is a post-   Yes/No.
 allocation swap.
If the swap is a post-allocation swap,   As provided in Sec.   45.5.
 the unique swap identifier of the
 initial swap transaction between the
 reporting counterparty and the agent.
The Legal Entity Identifier of the non-  As provided in Sec.   45.6, or
 reporting party.                         substitute identifier for a
                                          natural person.
An indication of whether the non-        Yes/No.
 reporting counterparty is a swap
 dealer with respect to the swap.
An indication of whether the non-        Yes/No.
 reporting counterparty is a major swap
 participant with respect to the swap.

[[Page 52584]]

 
If the non-reporting counterparty is     Yes/No.
 not a swap dealer or a major swap
 participant with respect to the swap,
 an indication of whether the non-
 reporting counterparty is a financial
 entity as defined in CEA section
 2(h)(7)(C).
An indication of whether the non-        Yes/No.
 reporting counterparty is a U.S.
 person.
The Unique Product Identifier assigned   As provided in Sec.   45.7.
 to the swap.
If no Unique Product Identifier is
 available for the swap because the
 swap is not sufficiently standardized,
 the taxonomic description of the swap
 pursuant to the CFTC-approved product
 classification system.
If no CFTC-approved UPI and product
 classification system is yet
 available, the internal product
 identifier or product description used
 by the swap data repository.
An indication that the swap is a multi-  Field values: Yes, Not
 asset swap.                              applicable.
For a multi-asset class swap, an         Generally, the asset class
 indication of the primary asset class.   traded by the desk trading the
                                          swap for the reporting
                                          counterparty. Field values:
                                          credit, equity, FX, interest
                                          rate, other commodity.
For a multi-asset class swap, an         Field values: credit, equity,
 indication of the secondary asset        FX, interest rate, other
 class(es).                               commodity.
An indication that the swap is a mixed   Field values: Yes, Not
 swap.                                    applicable.
For a mixed swap reported to two non-    Field value: LEI of the other
 dually- registered swap data             SDR to which the swap is or
 repositories, the identity of the        will be reported.
 other swap data repository (if any) to
 which the swap is or will be reported.
Contract type..........................  E.g., swap, swaption, option,
                                          basis swap, index swap.
Block trade indicator..................  Indication (Yes/No) of whether
                                          the swap qualifies as a
                                          ``block trade'' or ``large
                                          notional off-facility swap''
                                          as defined in part 43 of the
                                          CFTC's regulations.
Execution timestamp....................  The date and time of the trade,
                                          expressed using Coordinated
                                          Universal Time (``UTC''), as
                                          recorded by an automated
                                          system where available, or as
                                          recorded manually where an
                                          automated system is not
                                          available.
Execution venue........................  The swap execution facility or
                                          designated contract market on
                                          or pursuant to the rules of
                                          which the swap was executed.
                                          Field values: LEI of the swap
                                          execution facility or
                                          designated contract market, or
                                          ``off-facility'' if not so
                                          executed.
Timestamp for submission to swap data    Time and date of submission to
 repository.                              the swap data repository,
                                          expressed using UTC, as
                                          recorded by an automated
                                          system where available, or as
                                          recorded manually where an
                                          automated system is not
                                          available.
Start date.............................  The date on which the swap
                                          commences or goes into effect
                                          (e.g., in physical oil, the
                                          pricing start date).
Maturity, termination, or end date.....  The date on which the swap
                                          expires or ends (e.g., in
                                          physical oil, the pricing end
                                          date).
Buyer..................................  The counterparty purchasing the
                                          product: (E.g., the payer of
                                          the fixed price (for a swap),
                                          or the payer of the floating
                                          price on the underlying swap
                                          (for a put swaption), or the
                                          payer of the fixed price on
                                          the underlying swap (for a
                                          call swaption). Field values:
                                          LEI, if available, or
                                          substitute identifier, for a
                                          natural person.
Seller.................................  The counterparty offering the
                                          product: (E.g., the payer of
                                          the floating price (for a
                                          swap), the payer of the fixed
                                          price on the underlying swap
                                          (for a put swaption), or the
                                          payer of the floating price on
                                          the underlying swap (for a
                                          call swaption). Field values:
                                          LEI, or substitute identifier,
                                          for a natural person.
Quantity unit..........................  The unit of measure applicable
                                          for the quantity on the swap.
                                          E.g., barrels, bushels,
                                          gallons, pounds, tons.
Quantity...............................  The amount of the commodity
                                          (the number of quantity units)
                                          quoted on the swap.
Quantity frequency.....................  The rate at which the quantity
                                          is quoted on the swap. E.g.,
                                          hourly, daily, weekly,
                                          monthly.
Total quantity.........................  The quantity of the commodity
                                          for the entire term of the
                                          swap.
Settlement method......................  Physical delivery or cash.
Price..................................  The price of the swap. For
                                          options, the strike price.
Price unit.............................  The unit of measure applicable
                                          for the price of the swap.
Price currency.........................  ISO code.
Buyer pay index........................  The published price as paid by
                                          the buyer (if applicable). For
                                          swaptions, applies to the
                                          underlying swap.
Buyer pay averaging method.............  The averaging method used to
                                          calculate the index of the
                                          buyer pay index. For
                                          swaptions, applies to the
                                          underlying swap.
Seller pay index.......................  The published price as paid by
                                          the seller (if applicable).
                                          For swaptions, applies to the
                                          underlying swap.

[[Page 52585]]

 
Seller pay averaging method............  The averaging method used to
                                          calculate the index of the
                                          seller pay index. For
                                          swaptions, applies to the
                                          underlying swap.
Grade..................................  If applicable, the grade of the
                                          commodity to be delivered,
                                          e.g., the grade of oil or
                                          refined product.
Option type............................  Descriptor for the type of
                                          option transaction. E.g., put,
                                          call, straddle.
Option style...........................  E.g., American, European,
                                          European Daily, European
                                          Monthly, Asian.
Option premium.........................  The total amount paid by the
                                          option buyer.
Hours from through.....................  For electric power, the hours
                                          of the day for which the swap
                                          is effective.
Hours from through time zone...........  For electric power, the time
                                          zone prevailing for the hours
                                          during which electricity is
                                          transmitted.
Days of week...........................  For electric power, the profile
                                          applicable for the delivery of
                                          power.
Load type..............................  For electric power, the load
                                          profile for the delivery of
                                          power.
Clearing indicator.....................  Yes/No indication of whether
                                          the swap will be submitted for
                                          clearing to a derivatives
                                          clearing organization.
Clearing venue.........................  LEI of the derivatives clearing
                                          organization.
If the swap will not be cleared, an      Yes/No.
 indication of whether an exception to,
 or an exemption from, the clearing
 requirement has been elected with
 respect to the swap under part 50 of
 this chapter.
The identity of the counterparty         Field values: LEI, or
 electing an exception or exemption to    substitute identifier, for a
 the clearing requirement under part 50   natural person.
 of this chapter.
Clearing exception or exemption type...  The type of clearing exception
                                          or exemption being claimed.
                                          Field values: End user, Inter-
                                          affiliate or Cooperative.
Indication of collateralization........  Is the swap collateralized, and
                                          if so to what extent? Field
                                          values: Uncollateralized,
                                          partially collateralized, one-
                                          way collateralized, fully
                                          collateralized.
Any other term(s) of the swap matched    Use as many fields as required
 or affirmed by the counterparties in     to report each such term.
 verifying the swap.
------------------------------------------------------------------------


  Exhibit D--Minimum Primary Economic Terms Data--Other Commodity Swaps
             [Enter N/A for fields that are not applicable]
------------------------------------------------------------------------
 Additional data categories and fields
           for clearing swaps                        Comment
------------------------------------------------------------------------
Clearing swap USIs.....................  The USIs of each clearing swap
                                          that replaces the original
                                          swap that was submitted for
                                          clearing to the DCO, other
                                          than the USI for which the PET
                                          data is currently being
                                          reported (as ``USI'' field
                                          above).
Original swap USI......................  The USI of the original swap
                                          submitted for clearing to the
                                          DCO that is replaced by
                                          clearing swaps.
Original swap SDR......................  LEI of SDR to which the
                                          original swap was reported.
Clearing member LEI....................  LEI of Clearing member.
Clearing member client acct............  Clearing member client account
                                          number.
Origin (house or customer).............  An indication whether the
                                          clearing member acted as
                                          principal for a house trade or
                                          agent for a customer trade.
Clearing receipt timestamp.............  The date and time at which the
                                          DCO received the original swap
                                          for clearing, expressed using
                                          UTC.
Clearing acceptance timestamp..........  The date and time at which the
                                          DCO accepted the original swap
                                          for clearing, expressed using
                                          UTC.
------------------------------------------------------------------------


    Issued in Washington, DC, on August 20, 2015, by the Commission.
Christopher J. Kirkpatrick,
Secretary of the Commission.

    Note:  The following appendices will not appear in the Code of 
Federal Regulations.

Appendices to Amendments to Swap Data Recordkeeping and Reporting 
Requirements for Cleared Swaps--Commission Voting Summary, Chairman's 
Statement, and Commissioners' Statements

Appendix 1--Commission Voting Summary

    On this matter, Chairman Massad and Commissioners Bowen and 
Giancarlo voted in the affirmative. No Commissioner voted in the 
negative. Commissioner Wetjen did not participate in this matter.

Appendix 2--Statement of Chairman Timothy G. Massad

    One of the most important requirements of the Dodd-Frank Wall 
Street Reform and Consumer Protection Act is the reporting of data 
on the swaps market. In 2008 during the global financial crisis, 
regulators had little information about this market or the exposures 
of major institutions, but difficult policy choices still had to be 
made. Today, that has changed. Today, all swap transactions, whether 
cleared or uncleared, must be reported to swap data repositories 
(SDRs). The availability of accurate data is allowing the CFTC to 
move forward with the important work of monitoring the market and 
understanding its potential risks.
    While we have made great progress in this area, there is still 
more we need to do to make sure that we obtain useful and timely 
data as efficiently as possible. Today's proposal is one big step 
toward that end. If adopted, it will improve data quality and reduce 
compliance costs, by clarifying and simplifying some requirements 
and eliminating unnecessary reporting obligations.
    This proposal would ensure there is a simple, consistent process 
surrounding the reporting workflows for cleared swaps. For example, 
the proposal would clarify the reporting obligations of the 
clearinghouse where the swap is cleared. It would help ensure that 
there are not multiple records of

[[Page 52586]]

a swap that can lead to erroneous double counting, and that accurate 
valuations of swaps are provided on an ongoing basis. It would 
eliminate unnecessary reporting requirements for swap dealers and 
major swap participants. And it will improve the Commission's 
ability to trace swaps from execution through clearing.
    This proposal reflects a careful consideration of the feedback 
received from the CFTC's request for comment on this regulation in 
2014. It combines the best elements of those suggested by various 
stakeholders concerning the reporting of cleared swaps.
    I believe the proposal will help simplify compliance obligations 
for market participants while improving the accuracy, quality and 
usefulness of the data that is reported. This is an important part 
of the ongoing process of simplifying, fine-tuning and harmonizing 
our rules, and we will continue to look for ways to improve our 
recordkeeping, reporting, and data quality rules and practices.
    I look forward to reviewing comments to this proposal, and I 
encourage all market participants to provide feedback on this 
proposal.

Appendix 3--Statement of Commissioner Sharon Y. Bowen

    I strongly support this proposed rulemaking because reporting is 
one of the key pillars of the financial reform mandated by the Dodd-
Frank Wall Street Reform and Consumer Protection Act. The Dodd-Frank 
Act was intended to stabilize our financial system after the 2008 
crisis by reducing systemic risk, increasing transparency, and 
promoting market integrity within the financial system. Having 
accurate, comprehensive data is essential to meeting all of these 
goals. Without useful data about our markets, the Commission is 
unable to fully assess systemic risk and monitor market integrity. 
Accurate data does not only support financial reform, accurate data 
is itself a critical part of financial reform.
    This proposed rulemaking represents a major step toward making 
our data more accurate. With this rulemaking, we intend to provide 
clarity to swap counterparties, exchanges, clearing organizations, 
and swap data repositories about the part 45 reporting obligations 
with respect to cleared swaps. This rulemaking is also intended to 
improve the efficiency of data collection and maintenance associated 
with the reporting of cleared swaps.
    I have a keen interest in systemic risk and market structure 
issues. I believe regulators have an obligation to do everything in 
our power to gird our financial system to prevent a future financial 
crisis. Nearly seven years after the 2008 financial crisis, our 
economy has improved but the effects of the crisis linger. Many are 
still battling long-term unemployment, underemployment, and hobbled 
careers.
    The Commission cannot get a perfect picture of what is happening 
in our markets without accurate data. So while data collection may 
not seem like the most exciting topic, in fact it is crucial. If the 
devil is in the details in life, in financial regulation, the devil 
is in the data.
    But while I welcome this step, I realize that much more needs to 
be done. Our current part 45 rules outline the broad categories of 
data that the Commission needs, but market participants need much 
greater clarity on, among other things, what data needs to be 
submitted, how it needs to be submitted, and how data discrepancies 
need to be remediated. And our swap data repositories similarly need 
clarity on how to collect the data that the Commission needs to meet 
its mandate. While I am heartened by the international efforts to 
meet these aims, time is not on our side. The markets are active and 
real-time, and we need to get the best picture of what is happening 
in those markets as soon as possible.
    Our amazing staff has been able to use the data that we are 
currently receiving to engage in excellent market surveillance. Yet, 
our staff would be able to do even more if this data was improved; 
that is why I wholeheartedly support this proposal. I also hope that 
the Commission makes further efforts to improve our data and 
reporting regimes in the near future.

Appendix 4--Statement of Commissioner J. Christopher Giancarlo

    I support the issuance of the proposed rules to amend the 
cleared swaps data reporting provisions. I have been a consistent 
supporter of the swap data reporting reforms in the Dodd-Frank Act 
to provide regulators with increased transparency into the swaps 
market. Getting the reporting rules right is critical to provide 
regulators with the information they need to better understand and 
oversee these highly dynamic markets.
    Today's proposal demonstrates that the Commission can revisit 
Dodd-Frank rulesets and make needed adjustments based on its 
implementation experience over the past few years. I urge the 
Commission to take this same approach with other rulesets, including 
several of its swaps trading rules, to optimize the CFTC's swaps 
regulatory framework in light of the challenges of liquidity 
formation and market fragmentation that have grown since initial 
implementation.
    Although today's proposal only addresses a small subset of the 
issues raised in the 2014 request for comment on the Review of Swap 
Data Recordkeeping and Reporting Requirements,\1\ it is an important 
first step. I hope that the Commission tackles the other swap data 
reporting issues raised in the 2014 request for comment in the near 
future.
---------------------------------------------------------------------------

    \1\ Review of Swap Data Recordkeeping and Reporting 
Requirements, 79 FR 16689 (Mar. 26, 2014).
---------------------------------------------------------------------------

    I commend CFTC staff, especially the Division of Market 
Oversight staff, for their efforts on this proposal. I look forward 
to reviewing well-considered, responsive and informative comments 
from the public.

[FR Doc. 2015-21030 Filed 8-28-15; 8:45 am]
BILLING CODE 6351-01-P