1) SIFMA Legal Brief & Regulatory Tracker
January 2016
This brief provides a monthly update on pending and recently submitted SIFMA comment letters, listed by
agency.
Upcoming Filings
Department of Labor
Issue
Description
Regulation
SIFMA Committee
Due Date
Savings
Arrangements
Proposed regulation under the
Employee Retirement Income
Security Act of 1974 (ERISA)
setting forth a safe harbor
describing circumstances in which
a payroll deduction savings
program, including one with
automatic enrollment, would not
give rise to an employee pension
benefit plan under ERISA.
Proposed Rule - Savings
Arrangements Established
by States for Non
Governmental Employees
Savings Arrangements 1-19-2016
Working Group
Issue
Description
Regulation
SIFMA Committee
ATS Trade
Reporting
Proposed rule that would give
Proposed Rule Change to
Fixed Income Market
FINRA the authority to exempt
Adopt New FINRA Rule 6732 Structure Regulation
certain transactions by a member
Working Group
ATS that meet specified criteria
from the transaction reporting
obligations under FINRA Rule
6730.
1-13-2016
Disclosure
Proposal
FINRA is proposing to require firms SR-FINRA-2015-057 to deliver an educational
Proposed rule change to
document to retail customers
adopt FINRA Rule 2273
when a registered person changes
firms.
Compliance and
Regulatory Policy
Committee and
Private Client Group
1-20-2016
FINRA
Due Date
Hong Kong Monetary Authority
Issue
Description
Regulation
SIFMA Committee
Due Date
Margin and
Other Risk
Mitigation
Standards
Request for public comment on
Non-centrally Cleared OTC
Derivative Transactions – Margin
and Other Risk Mitigation
Standards
Consultation paper - Noncentrally Cleared OTC
Derivatives Transactions –
Margin and Other Risk
Mitigation Standards
GFXD
1-29-2016
Washington
Stephen Vogt |AVP & Assistant General Counsel, Office of the General Counsel | svogt@sifma.org | 202-962-7393
J.T. Gyorfy |Assistant Vice President, Public Policy & Advocacy | jtgyorfy@sifma.org | 202-962-7448
2) Recently Submitted
Congress
Issue
Description
Regulation
Credit Risk
Transfer
Transactions
SIFMA provides comments to
N/A
congress in strengthening the
Federal Housing Finance Agency’s
(FHFA) efforts to implement
private-sector credit risk transfer
transactions (CRT) involving Fannie
Mae and Freddie Mac. SIFMA and
its member firms strongly support
Congress in their effort to restore
significant levels of private capital
participation in the extension of
mortgage credit. Like many
stakeholders, our industry seeks a
mortgage market that balances
access to credit with systemic
stability and prudent underwriting.
SIFMA Committee
Submitted
Securitization Group
12-7-2015
SIFMA Committee
Submitted
Systemic Risk and
Prudential Standards
Committee
12-18-2015
Federal Reserve, FDIC, and OCC
Issue
Description
Regulation
Capital
Treatment of
Settled to
Market Cleared
OTC Derivative
Contracts
SIFMA provided comments to
N/A
multiple agencies to inform them
of a forthcoming change in market
practice for cleared derivatives.
Specifically, central clearing
counterparties (CCPs) have been
working with other market
participants (including U.S. and
European clearing member firms,
law firms and accounting firms) to
amend or clarify their terms, rules,
and procedures to determine
circumstances under which the
payment of variation margin (VM)
for over-the-counter (OTC)
derivatives that are cleared
through CCPs constitutes
settlement of the exposure, as
opposed to collateralization. While
the status of implementation of
these changes varies across CCPs
and clearing member firms, SIFMA
Washington
Stephen Vogt |AVP & Assistant General Counsel, Office of the General Counsel | svogt@sifma.org | 202-962-7393
J.T. Gyorfy |Assistant Vice President, Public Policy & Advocacy | jtgyorfy@sifma.org | 202-962-7448
3) wanted to make you these
agencies aware of the regulatory
capital consequences – resulting
from the regulatory capital
framework’s recognition of
settlement as exposure-reducing –
about which clearing member firms
may notify their supervisors in
coming months.
Federal Reserve, FDIC, OCC, and SEC
Issue
Description
Incentive-Based SIFMA provides comments to the
Compensation Office of the Comptroller of the
Currency (OCC), the Board of
Governors of the Federal Reserve
System (Federal Reserve), the
Federal Deposit Insurance
Corporation (FDIC) and the
Securities and Exchange
Commission (SEC) on Re-proposal
of Rules on Incentive-Based
Compensation Arrangements.
Regulation
SIFMA Committee
Submitted
Section 956 of the DoddFrank Act
Executive
Compensation
Committee
12-18-2015
Regulation
SIFMA Committee
Submitted
Senior Investors
Working Group
12-1-2015
FINRA
Issue
Description
Senior Investor
Protection
SIFMA provides comments to the FINRA Regulatory Notice
Financial Industry Regulatory
15-37
Authority (FINRA) on Rule 4512 and
new Proposed Rule 2165. Senior
financial exploitation is a problem
that costs senior investors an
estimated $2.9 billion annually.
Through FINRA’s launch of its tollfree securities helpline for seniors
and the release of Regulatory
Notice 15-37, FINRA has made clear
its commitment to bringing its
frontline investor protection
expertise to bear on the unique
challenges facing aging and
vulnerable investors.
Washington
Stephen Vogt |AVP & Assistant General Counsel, Office of the General Counsel | svogt@sifma.org | 202-962-7393
J.T. Gyorfy |Assistant Vice President, Public Policy & Advocacy | jtgyorfy@sifma.org | 202-962-7448
4) FINRA and MSRB
Issue
Description
Regulation
SIFMA Committee
Submitted
Bond Market
Price
Transparency
SIFMA provides comments to the
Financial Industry Regulatory
Authority’s (FINRA’s) Regulatory
Notice 15-36 and the Municipal
Securities Rulemaking Board’s
(MSRB’s) Regulatory Notice 201516. SIFMA strongly supports efforts
to enhance bond market price
transparency in a way that provides
retail investors with useful, clear,
and consistent insight into their
transactions, and appreciates the
deep engagement with our
members by both FINRA and the
MSRB over the past several months
concerning this issue.
FINRA Regulatory Notice
15-36
Municipal Securities
Division
12-11-2015
Description
Regulation
SIFMA Committee
Submitted
Request for Comment on
Changes to MSRB Rules to
Facilitate Shortening the
Securities Settlement
Cycle
Municipal Securities
Division, Operations
and Technology
Committee
12-10-2015
Regulation
SIFMA Committee
Submitted
Municipal Securities
Committee
12-1-2015
MSRB Regulatory Notice
2015-16
MSRB
Issue
SIFMA provides comments to the
Shortened
Settlement Cycle Municipal Securities Rulemaking
Board (MSRB) on changes to MSRB
rules to facilitate shortening the
securities settlement cycle. The
draft amendments are in response
to a financial services industry-led
initiative to shorten the regular
way settlement for equities,
corporate bonds, municipal bonds,
and unit investment trusts from
T+3 to T+2.
SEC
Issue
Description
MSRB Rule G-42 SIFMA provides comments to the Proposed changes to
Securities and Exchange
MSRB Rule G-42
Commission (SEC) on amendment
#2 to its proposed changes to
MSRB Rule G-42, on duties of nonsolicitor municipal advisors.
Washington
Stephen Vogt |AVP & Assistant General Counsel, Office of the General Counsel | svogt@sifma.org | 202-962-7393
J.T. Gyorfy |Assistant Vice President, Public Policy & Advocacy | jtgyorfy@sifma.org | 202-962-7448
5) U.S. Bankruptcy Court (S.D.N.Y.)
Issue
Description
Case
Amicus "Friend
of the Court"
Brief
Whether “flip clauses” – which
Lehman Brothers Special
subordinate amounts payable to Financing v. Bank of
Lehman (in favor of collateralized America NA
debt obligation (CDO)
noteholders) on the termination of
credit default swaps backing
synthetic CDOs – are enforceable,
or whether such clauses are
barred by the ipso facto doctrine
of bankruptcy law.
SIFMA Committee
Submitted
Litigation Advisory
Committee
12-21-2015
SIFMA Committee
Submitted
Litigation Advisory
Committee
12-18-2015
U.S. Court of Appeals - Eighth Circuit
Issue
Description
Case
Amicus "Friend
of the Court"
Brief
Whether a meaningful comparison Tussey v. ABB Inc.
may be made between a balanced
fund and a target date fund, and
what factors and facts can and
should be weighed in deciding
whether to replace a balanced
fund with a target date fund in a
company’s 401(k) plan.
U.S. Supreme Court
Issue
Description
Case
SIFMA Committee
Submitted
Amicus "Friend
of the Court"
Brief
Whether national bank
preemption of state usury laws
extends only to an originating
national bank, and not to any
assignee to whom the bank may
sell the debt later in time
(specifically, purchasers of credit
card loans from national banks),
which would likely negatively
impact both national banks and
secondary market participants
who purchase loan products
originated by banks.
Midland Funding, LLC v.
Madden
Litigation Advisory
Committee
12-11-2015
Washington
Stephen Vogt |AVP & Assistant General Counsel, Office of the General Counsel | svogt@sifma.org | 202-962-7393
J.T. Gyorfy |Assistant Vice President, Public Policy & Advocacy | jtgyorfy@sifma.org | 202-962-7448
6) Wisconsin - Committee on Labor and Government Reform (The Honorable Stephen L. Nass)
Issue
Description
Regulation
State Run
Retirement
SIFMA provides comments to the 2015 Senate Bill 45
Honorable Stephen L. Nass in
opposition of SB 45. SB 45 would
create a Wisconsin Retirement
Security Board (RSB) to conduct a
feasibility study on, hold at least
four public hearings across the
state regarding, and finally
establish and manage a private
retirement security plan for state
residents. We agree that there is a
retirement savings challenge in
this country; however, we have
serious concerns with the
legislation focusing on a state run
retirement savings plan for private
sector workers as its exclusive
remedy.
SIFMA Committee
Submitted
State Government
Relations
12-10-2015
Washington
Stephen Vogt |AVP & Assistant General Counsel, Office of the General Counsel | svogt@sifma.org | 202-962-7393
J.T. Gyorfy |Assistant Vice President, Public Policy & Advocacy | jtgyorfy@sifma.org | 202-962-7448