Clearing Requirement Determination Under Section 2(h) of the Commodity Exchange Act for Interest Rate Swaps To Account for CAD and MXN Interest Rate Benchmark Transitions

This section of the FEDERAL REGISTER contains regulatory documents having general applicability and legal effect, most of which are keyed to and codified in the Code of Federal Regulations, which is published under 50 titles pursuant to 44 U.S.C. 1510. The Code of Federal Regulations is sold by the Superintendent of Documents. Rules and Regulations Federal Register 57063 Vol. 91, No. 172 Tuesday, September 8, 2026 1 Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111–203, 124 Stat. 1376 (2010). 2Section 2(h)(1)(A) of the CEA, 7 U.S.C. 2(h)(1)(A). 3Section 2(h)(2)(A) of the CEA, 7 U.S.C. 2(h)(2)(A). Section 2(h)(2)(A) provides for a Commission-initiated review process whereby the Commission, on an ongoing basis, must review swaps, or a group, category, type, or class of swaps, to determine whether a swap, or a group, category, type, or class of swaps, should be required to be cleared. 4Section 2(h)(2)(B) of the CEA, 7 U.S.C. 2(h)(2)(B). Section 2(h)(2)(B)(i) requires that each DCO submit to the Commission each swap, or group, category, type, or class of swaps, that it plans to accept for clearing. The swaps subject to this determination were submitted by DCOs pursuant to CEA section 2(h)(2)(B)(i) and regulation 39.5(b), 17 CFR 39.5(b). Pursuant to section 2(h)(2)(B)–(C) of the CEA, the Commission must review swap submissions from DCOs to determine whether the swaps should be subject to required clearing. Regulation § 39.5(b) implements the procedural elements of section 2(h)(2)(B)–(C) by establishing the process by which a DCO must submit the swaps it offers for clearing to the Commission for purposes of considering a clearing requirement determination. COMMODITY FUTURES TRADING COMMISSION 17 CFR Part 50 RIN 3038–AF69 Clearing Requirement Determination Under Section 2(h) of the Commodity Exchange Act for Interest Rate Swaps To Account for CAD and MXN Interest Rate Benchmark Transitions AGENCY: Commodity Futures Trading Commission. ACTION: Final rule. SUMMARY: The Commodity Futures Trading Commission (Commission or CFTC) is amending its interest rate swap clearing requirement regulations under applicable provisions of the Commodity Exchange Act (CEA) to address the transition from the Canadian Dollar Offered Rate (CDOR) to the Canadian Overnight Repo Rate Average (CORRA), and the transition from the Mexican Interbank Equilibrium Interest Rate (la Tasa de Intere´s Interbancaria de Equilibrio, or TIIE by its Spanish acronym) to the TIIE Funding Rate (TIIE de Fondeo or F–TIIE), as benchmark reference rates for interest rate swaps denominated, respectively, in Canadian dollars (CAD) and Mexican pesos (MXN). These transitions are part of an ongoing global effort by market participants, benchmark administrators, regulators, and others to shift away from reliance on certain interbank offered rates (IBORs) that have become unavailable as benchmark reference rates and adopt alternative reference rates, which are predominantly
overnight, nearly risk-free reference rates (RFRs). These amendments revise the set of interest rate swaps that are required to be submitted for clearing, pursuant to the CEA and the Commission’s regulations, to a derivatives clearing organization (DCO) that is registered under the CEA (registered DCO) or a DCO that has been exempted from such registration (exempt DCO). The amendments modify the Commission’s interest rate swap clearing requirement to reflect the market transitions from swaps referencing CAD CDOR and MXN TIIE to swaps referencing, respectively, CAD CORRA and MXN F–TIIE. DATES: The amended rules are effective October 8, 2026. FOR FURTHER INFORMATION CONTACT:
Sarah E. Josephson, Deputy Director, at 202–418–5684 or sjosephson@cftc.gov; Daniel O’Connell, Special Counsel, at 202–418–5583 or doconnell@cftc.gov; or Philip Tumminio, Special Counsel, at 202–418–5910 or ptumminio@cftc.gov, Division of Clearing and Risk at the Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st Street NW, Washington, DC
20581.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background
A. Commission’s Swap Clearing Requirement B. Global Progress on Benchmark Reform
C. CAD and MXN Interest Rate Benchmark
Transitions
II. Domestic and International Coordination
Efforts
A. Domestic Coordination Efforts B. International Coordination Efforts
C. Clearing Requirements in Other
Jurisdictions
III. Overview of Comment Letters Received
IV. Final Amendments to Regulation § 50.4(a)
V. Determination Analysis for RFR OIS
A. General Description of Information Considered B. Consistency With DCO Core Principles Under Section 2(h) of the CEA
C. Conclusions Regarding Consideration of
Section 2(h)’s Five Statutory Factors
VI. Implementation Schedule
VII. Cost Benefit Considerations
A. Statutory and Regulatory Background B. Overview of Swap Clearing
C. Consideration of the Costs and Benefits
of the Commission’s Action D. Costs and Benefits of the Amendments as Compared to Alternatives E. Section 15(a) Factors
VIII. Related Matters
A. Regulatory Flexibility Act B. Paperwork Reduction Act
C. Antitrust Laws
D. Executive Orders 12866, 13563, and 14192 E. Congressional Review Act
I. Background
A. Commission’s Swap Clearing Requirement The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd￾Frank Act) established a comprehensive new regulatory framework for swaps.1 Title VII of the Dodd-Frank Act (Title VII) amended the CEA to require, among other things, that a swap be cleared through a registered DCO or an exempt DCO if the Commission has determined that the swap, or group, category, type, or class of swaps, is required to be cleared, unless an exception to the clearing requirement applies.2 The CEA, as amended by Title VII, provides that the Commission may issue a clearing requirement determination based either on a Commission-initiated review of a swap 3 or a swap submission from a DCO.4
Section 2(h)(2)(D)(ii) of the CEA
requires the Commission to consider the following five factors when making a clearing requirement determination: (I) the existence of significant outstanding notional exposures, trading liquidity, and adequate pricing data; (II) the availability of rule framework, capacity, operational expertise and resources, and credit support infrastructure to clear the contract on terms that are consistent with the material terms and trading conventions on which the contract is traded; (III) the effect on the mitigation