On September 22, Senator Jack Reed, Chairman of the Banking Subcommittee on Securities, Insurance and Investment, introduced the Comprehensive Derivatives Regulation Act of 2009 (CDRA). The CDRA is intended to provide a comprehensive regulatory regime for derivatives products, and includes the following elements:
- Provides jurisdiction to the Securities and Exchange Commission over all securities-related derivatives, which would include credit default swaps and all security futures (including broad-based security index futures contracts), and provides jurisdiction to the Commodity Futures Trading Commission over all other derivatives. The CFTC would retain jurisdiction over Treasury and interest rate derivatives.
- Requires central clearing of standardized over-the-counter derivatives, including credit default swaps.
- Sets capital, margin, registration and recordkeeping requirements for derivatives dealers and other major market participants.
- Expands regulatory authority to set position limits and oversee marketing of derivatives to certain categories of investors.
A press release regarding the CDRA is available here.