Regulators Adopt Margin Rules For Non-Cleared Swaps

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd- Frank) mandates the margining of bilateral swaps and security-based swaps that are not cleared by a registered derivatives clearing organization or a registered clearing agency (collectively, Non-Cleared Swaps). Dodd-Frank requires U.S. federal financial regulators to adopt implementing rules for collecting and posting mandated initial and variation margin by the following registered entities (Swap Entities): swap dealers and major swap participants registered with the U.S. Commodity Futures Trading Commission (the CFTC) and security-based swap dealers and major security-based swap participants registered with the U.S. Securities and Exchange Commission (the SEC).