CFTC Chairman J. Christopher Giancarlo and CFTC Commissioner Dan Berkovitz continued to exchange differing views on the merit of potential expanding execution requirements for swap execution facilities at the International Swaps and Derivatives Association’s DerivCon 2019. Generally, Mr. Giancarlo supported the proposed rule changes, claiming, in particular, that adding flexibility to SEF execution methods would promote innovation “to meet demand and operate trading environments that are more salutatory to the episodic nature of swaps liquidity.” Mr. Giancarlo – joined in his views by CFTC Commissioner Brian Quintenz – warned that the status quo could significantly impede liquidity “when the next crisis comes.” Mr. Berkovitz argued that “if it ain’t broke, don’t fix it", however. He claimed that current rules – including trade execution requirements – have promoted the migration of swaps trading to SEFs. Mr. Giancarlo also argued that the current CFTC interpretation that floor traders lose the ability to be excluded from the definition of swap dealer if they enter into “just one swap that is off-venue or uncleared” is inconsistent with Congressional intent. He indicated that, as a result, the CFTC’s Division of Swap Dealer and Intermediary Oversight would be “inclined to provide appropriate[e] … no-action relief” to a request for relief from this interpretation. (Click here for background on Mr. Giancarlo’s and Mr. Berkovitz’s different view on the proposed SEF rules, and the proposed rules themselves in the article “Different Roads to Travel for Swap Execution Reform Proposed by CFTC Chairman and New Commissioner” in the February 3, 2019 edition of Bridging the Week.)