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House Ag Committee Chair Echoes Dodd-Lincoln Position on End User Exemption

By Jim Hamilton

Echoing the position of Senators Dodd and Lincoln, House Agriculture Committee Chair Colin Peterson said that Congress focused on creating a regulatory approach in the Dodd-Frank Act that permits end users to continue using derivatives to hedge risks associated with their underlying businesses, whether it is energy exploration, manufacturing, or commercial activities. He emphasized that it is ``patently false?? to imply that capital and margin requirements apply to end users of derivatives. The section in question governs the regulation of major swap participants and swap dealers, and its provisions apply only to major swap participants and swap dealers. Regulators are not authorized to impose capital and margin requirements on end users. Cong. Record, June 30, 2010, p. H5425.

Full post as published by Jim Hamilton's World of Securities Regulation on July 02, 2010 (boomark / email).