Corporate Governance

Senate-House Conference Agrees on Final Volcker Rule

By Harvard Law School Program on Corporate Governance

Early Friday morning, the House-Senate Conference on the Dodd-Frank Act of 2010 (the ?Act?) agreed on the final legislative text of the Act, including Section 619 (the ?Volcker Rule?). The Volcker Rule is a revised version of an amendment introduced by Senators Merkley (D?OR) and Levin (D?MI) in the final stages of the Senate debate, and takes the form of new Section 13 of the Bank Holding Company Act of 1956 and new Section 27B of the Securities Act of 1933.

Summary

Subject to certain exceptions, the Volcker Rule prohibits any ?banking entity? from engaging in proprietary trading, or sponsoring or investing in a hedge fund or private equity fund. It also requires systemically important nonbank financial companies to carry additional capital and comply with certain other quantitative limits on such activities, although it does not expressly prohibit them.

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Full post as published by The Harvard Law School Corporate Governance Blog on June 27, 2010 (boomark / email).