Federal Register #RIN 3038AF36

CFTC Final Rule: Amendments to Margin Requirements for Uncleared Swaps

The Commodity Futures Trading Commission (CFTC) has finalized regulatory amendments impacting margin requirements for uncleared swaps involving swap dealers and major swap participants. - Government Buyer: - Commodity Futures Trading Commission (CFTC) - No OEMs or commercial vendors are involved, as this is a regulatory action, not a procurement. - Key Regulatory Changes: - Seeded Funds Amendment: - Exempts certain start-up investment funds (seeded funds) from initial margin (IM) requirements for up to three years, provided they meet independence and operational criteria. - Eligible Collateral Amendment: - Removes restrictions on money market and similar funds engaging in repurchase agreements from qualifying as eligible collateral for margin purposes. - Updates the haircut schedule for eligible collateral assets. - Notable Requirements: - Aligns U.S. margin rules with international standards. - Aims to reduce operational burdens and enhance market liquidity and efficiency. - No products or services are being procured; this is a regulatory change affecting swap dealers and major swap participants.

Description

The Commodity Futures Trading Commission (CFTC) is issuing a final rule amending margin requirements for uncleared swaps applicable to swap dealers and major swap participants not subject to prudential regulator margin rules. The amendments revise the definition of "margin affiliate" to provide relief for certain seeded funds, exempting them from initial margin requirements for up to three years from trading inception. The rule also expands eligible collateral assets by eliminating restrictions on securities issued by certain pooled investment funds and amends the haircut schedule for collateral. The final rule is effective August 17, 2026.

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