Sweeping regulatory changes are taking place in the global over-the-counter markets. MarketAxess has been working closely with the industry and with our clients to help prepare for the new CDS landscape. We hope you will use these resources to help you stay ahead of the CDS e-trading curve.

Latest Regulatory Updates

Thursday May 8, 2014 | CFTC Further Implements Trade Execution Mandate

CFTC Implements Trade Execution Mandate Related to Package Trades

On May 1, the CFTC addressed a critical issue in the implementation of the trade execution mandate for swaps: how to handle "package trades" that involve more than one type of contract but are priced and traded as one transaction.

The CFTC staff issued a no-action letter establishing a "phased compliance timeline" for these transactions, which make up a significant portion of the trading activity in the credit default swaps markets. The timeline consists of four dates by which certain types of package trades must be executed on swap execution facilities (SEFs) or designated contract markets (DCMs):

  • May 15: trades in which all components are swaps that have been "made available to trade" and therefore are subject to the trade execution requirement;
  • June 1: trades in which at least one MAT swap component and all other components are swaps subject to the clearing requirement;
  • June 15: trades in which the swap components are MAT and all other components are U.S. Treasury securities (U.S. Dollar Swap Spreads); and
  • Nov. 15: trades with at least one MAT swap component and at least one component that is either 1) a futures contract (invoice spread) or some other type of instrument that is not a swap, 2) a swap not subject to the clearing requirement, or 3) an equity swap or other type of swap not solely regulated by the CFTC.

The no-action letter also provides further time-limited relief for the clearing of package trades, under which SEFs and DCMs will be able to permit new trades to replace earlier trades that have been rejected for clearing without violating the CFTC's prohibition on pre-arranged trading.

The CFTC said this clearing-related relief effectively means that the SEFs can implement a "new trade, old terms" procedure. This relief is subject to certain conditions and will expire on Sept. 30.

Read the full press release on the CFTC Website.

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Reppas FIA

Grigorios Reppas, CDS Product Manager, discusses our SEF.

Public Comments

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MarketAxess as a SEF

MarketAxess provides a comprehensive suite of CDS trading capabilities. We offer institutional market participants a single trading platform with easy access to multi-dealer competitive CDS pricing.

The streamlined request-for-quote (RFQ) trading protocol gives investors live, executable levels in both index and single-name CDS. Our 'streaming markets' protocol allows investors to initiate trades with a single click.

Investors can also trade baskets of CDS single-names using our patented list trading protocol, which is a proven efficiency tool.

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MarketAxess as a MTF

MarketAxess provides a comprehensive suite of CDS trading capabilities. We offer institutional investors a single trading platform with easy access to multi-dealer competitive CDS pricing.

The streamlined request-for-quote (RFQ) trading protocol gives investors live, executable levels in both index and single-name CDS. Our 'click-to-trade' (CTT) protocol allows investors to view streaming market prices and initiate trades with a single click.

Investors can also trade baskets of CDS single-names using our patented list trading protocol, which is a proven efficiency tool.

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Comment Letters

  • Sep132013

    MarketAxess SEF Received Temporary Registration Approval From The CFTC Read MarketAxess Press Release Read CFTC Press Release

  • Jul122013

    MarketAxess filed its application to become a Swap Execution Facility (SEF) under the Commodity Futures Trading Commission’s (CFTC) Dodd-Frank Act. Review MarketAxess SEF application

  • Mar82013

    MarketAxess last week submitted a letter to the CFTC requesting conditional exemption from Swap Execution Facility (SEF) registration. Download the PDF

  • Sep62012

    CFTC Comment Letter on the Clearing Requirement Determination under Section 2(h) of the Commodity Exchange Act, as amended by Dodd-Frank Download the PDF

  • Feb132012

    CFTC Comment Letter on the Process for a Designated Contract Market or Swap Execution Facility to Make a Swap Available to Trade Download the PDF

  • Jun292011

    CFTC Comment Letter on Effective Date for Swap Regulation Download the PDF

  • Jun32011

    CFTC Comment Letter on Proposed Rules Implementing Core Principles and Other Requirements for Swap Execution Facilities Download the PDF

  • Apr42011

    SEC Comment Letter on the Registration and Regulation of Security-Based Swap Execution Facilities Download the PDF

  • Mar212011

    CFTC Comment Letter on Proposed Rule 75 FR 3690, "Risk Management Requirements for DCOs" Download the PDF

  • Mar82011

    CFTC Comment Letter on Proposed Rule 76 FR 1214, "Core Principles for SEFs" Download the PDF

  • Nov162010

    CFTC Comment Letter on Proposed Rule 75 FR 63732, "Mitigation of Conflicts of Interest" Download the PDF

Additional Resources

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