The Commodity Futures Trading Commission on Thursday voted 3-2 to approve a rule under the Dodd-Frank Act that cedes the CFTC’s regulation of non-U.S. market participants in cross-border derivatives to other countries. The rule will exempt swap dealers (SD) and major swap participants (MSP) already registered with foreign regulators from also having to register with the CFTC under provisions of the Commodity Exchange Act (CEA).
Supporters said the move is an acknowledgement of the vitality of foreign regulation of those activities. Critics like Better Markets, a non-profit that favors tougher regulation of American financial markets, alleged the CFTC was “recklessly outsourcing the protection of American taxpayers to foreign regulators.”
