On June 18, the SEC and CFTC issued a joint request for comment on potential ways to further update, clarify and harmonize certain derivatives product definitions and interpretive issues under Title VII of the Dodd-Frank Act. The agencies said the request is intended to support the agencies’ evaluation of whether current regulatory definitions, interpretations and jurisdictional frameworks appropriately reflect evolving market structures, financial products, and trading practices. The agencies stated that market participants have raised interpretive questions as innovative products are developed and have sought clarity on agency oversight and compliance for products that may implicate both agencies’ interest and oversight authority.

The request seeks input on: (i) definitions relating to swaps and security-based swaps, including the scope of certain exclusions from the swap definition; (ii) treatment of mixed swaps; (iii) treatment of novel or emerging products; (iv) jurisdictional and interpretive questions; (v) potential areas in need of greater clarity regarding regulatory definitional lines; and (vi) potential areas for alternative compliance. The agencies seek specific feedback for each topic. For example, regarding alternative compliance, the agencies ask whether compliance with one agency’s regulatory framework could appropriately satisfy substantially similar requirements of the other in circumstances where trading in economically related or functionally similar product classes implicates both agencies’ regulatory interests. Comments must be submitted by August 24.