On September 10, 2012, the CFTC published a FAQ addressing questions related to determining when an entity is required to register as a swap dealer. The CFTC addressed the following:
- The swap dealer registration regulations go into effect on October 12, 2012 and entities that have more than the de minimis level of dealing must register by no later than two months after the end of the month in which they surpass the de minimis level. Swap dealing will be counted from October 12, 2012 meaning that a person whose swap dealings exceed an applicable gross notional amount threshold on October 13, 2012 will be a “swap dealer” as of October 13, 2012 but has until December 31, 2012 to register (i.e., two months after the end of the month in which the person’s swaps exceeded either of the thresholds).
- The de minimis threshold is set at a gross notional amount of $3 billion, subject to a phase in of $8 billion, or $25 million with regard to swaps with a counterparty that is a “special entity”.
- All swaps connected with a person’s swap dealing activities (or those of any other entity controlling, controlled by or under common control with the person) entered into after October 12, 2012 must be included in calculating whether a person’s dealing activities exceed the de minimis threshold.
- There is nothing that prohibits a person from registering as a swap dealer even if it has not yet come within the definition of swap dealer.