Regulatory Alerts2013-08-22 | 2013-19945Clearing Exemption for Certain Swaps Entered Into by Cooperatives
The Commodity Futures Trading Commission adopted final regulations granting a clearing exemption to certain financial entity cooperatives that meet specified conditions, allowing them to opt out of mandatory swap clearing requirements under the Commodity Exchange Act. The exemption permits these cooperatives to clear swaps only when acting in the mutual interests of their member-owners to hedge commercial risks or fund member loans, effectively extending the statutory end-user exception to cooperatives exceeding the standard $10 billion asset threshold. By recognizing the unique member-owned structure of cooperatives, the rule preserves their ability to provide affordable risk management tools to agricultural, rural, and credit union members while maintaining systemic financial stability.