On May 24th, the House Financial Services Committee agreed to legislation that would delay the implementation of the derivatives and swaps market reform portions of the Dodd-Frank Act for two years. Rulemakings that would be affected by this legislation would likely include rules on capital requirements and governance standards for swaps dealers, and regulations that would create swap execution facilities or exchanges. H.R. 1573 was referred to as a “common-sense bill that gives regulators additional time and information to engage in the proper due diligence…” by Committee Chairman Spencer Bachus (R-AL), and was approved by a party-line vote of 30-24, with some members of the New York delegation who had sent the letter to Gensler urging for delays in his rulemaking, missing the final vote (though two members who signed the letter, Carolyn Maloney and Greg Meeks voted against the proposal). It is worth noting that this legislation does not make any modifications to the actual substance of the Dodd-Frank reforms, and instead only changing the deadlines for certain provisions would be extended, including changing the effective date of the entire derivatives title to September 30, 2012.
As expected, Representative Barney Frank spoke out against the bill, charging that “it's not a bill to give the regulators more time—it is a bill to prevent the regulators from acting.” The Agriculture Committee, which shares jurisdiction over the CFTC with House Financial Services, has already approved the bill to proceed to the House floor. Despite support in the House, if passed, it is unlikely to succeed in the Senate.