SEC Final Rules on Registration of Security-Based Swap Entities and Proposed Rules on Statutorily Disqualified Associated Persons

21 September 2015
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Key takeaways

  • The SEC has issued final rules establishing a process for security-based swap dealers and major security-based swap participants (“SBS Entities”) to register with the SEC, as required under the Securities Exchange Act.
  • The final rules address, among other things, the content of the registration application and the appropriate form to be filed by various types of entities, the process for filing such an application and any amendment thereto, the certifications and due diligence required in connection with an application, the process for terminating an SBS Entity’s registration and certain additional requirements applicable to “nonresident” SBS Entities.
  • The final rules also provide a limited exception to SBS Entities from the prohibition against using a “statutorily disqualified” associated person in effecting the SBS Entity’s security-based swap transactions, which exception applies only to APs that are entities.
  • In connection with the final rules, the SEC also issued proposed rules setting forth a process for SBS Entities to file an application with the SEC for permission to have statutorily disqualified APs effect or be involved in effecting security-based swaps on the SBS Entity’s behalf, despite this prohibition.