US - CFTC issues final cross-border margin rules for uncleared swaps
On 24 May 2016, the Commodity Futures Trading Commission (CFTC) released final rules and accompanying interpretative guidance setting forth the application of the CFTC's initial and variation margin requirements to cross-border swap transactions.
The Final Rule builds upon the final initial and variation margin obligations published in January 2016 for swaps entered by swap dealers and major swap participants not covered by rules from the US prudential regulators (Covered Swap Entities) and provides specific clarity on the cross-border application of the latter CFTC margin rules. The Final Rule in general does not apply to non-US persons, in particular not capturing commodity pools and collective investment vehicles majority owned by U.S persons, although it does capture any non-US entities whose swap activities are guaranteed by a US person or its financial statements are consolidated with a US ultimate parent entity. The Final Rules became effective on 1 August 2016.