Additional Verification Required

CFTC Proposes Enhanced Swap Data Verification Requirements

May 16, 2019

On April 25, 2019, the Commodity Futures Trading Commission proposed amendments to its regulations governing swap data repositories, including regulations affecting the data reported to and maintained by SDRs.

This proposed rulemaking is the first of the three rulemakings the CFTC is expected to release related to its 2017 Roadmap to Achieve High Quality Swaps Data and the associated comprehensive review of, and solicitation of comments regarding, the CFTC swap data reporting rules and swap reporting requirements. This Proposal is generally focused on amendments to regulations affecting SDRs, but would also impose significant new obligations upon the party to a swap transaction responsible for reporting specified information regarding the transaction to an SDR. Such obligations include regular reconciliation and verification of the completeness and accuracy of Swap Data (including all data fields) for the RCP’s open swaps and prompt correction of errors and omissions, including for swaps that have expired or been terminated.

The following Memorandum provides a brief overview of the applicable regulations to SDRs and RCPs, with particular focus on how the Proposal, if finalized, would alter an RCP’s obligations.