Acting CFTC chairman targets swaps regulation overhaul

Acting chairman Chris Giancarlo has targeted swaps execution and variation margin rules as part of his regulatory overhaul.

The new acting chairman of the US derivatives watchdog has set his sights on overhauling rules on trading swaps with a new regulatory programme.

Chris Giancarlo, the sole Republican commissioner at the Commodity Futures Trading Commission (CFTC) and favourite to take on the chairman role, has said he will put in place a new regulatory agenda called “Making Market Reform Work for America”.

The acting chairman has specifically highlighted rules over trading swaps on electronic platforms as a key target in his agenda.

“Making market reform work for America means allowing market participants to choose the manner of trade execution best suited to their swaps trading and liquidity needs and not have it chosen for them by the federal government,” he stated.

“Making market reform work for America means addressing the market fragmentation that has arisen as a consequence of the CFTC’s flawed swaps trading regime.”

Giancarlo also addressed the incoming variation margin rules for uncleared OTC derivatives, which is set to come into force in the US and in several other markets on 1 March. However other countries including Australia, Hong Kong and Singapore, have said they will phase-in the requirements over a six-month transition period.

“As acting chairman, I also intend to look at solutions to ease the March 1st transition in a responsible manner. Look for the CFTC to have more to say about this in the weeks to come,” he added.