Overview

On 29 April 2011, the US Department of the Treasury issued a notice of proposed determination that would exempt both foreign exchange (FX) swaps and forwards from the definition of “swap” under the Commodity Exchange Act (CEA) as amended by the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank).

Dodd-Frank authorised the Secretary of the Treasury to grant such an exemption. The Proposed Determination justifies the exemption based largely on several characteristics of the FX swaps and forwards market.

Shearman & Sterling outlines these characteristics, and also looks at the scope of exemption. To read more, click View Briefing.