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Comment for Proposed Rule 75 FR 80638

  • From: Ex Parte Communication
    Organization(s):
    Morgan Stanley

    Comment No: 35491
    Date: 4/5/2011

    Comment Text:

    Meeting with Morgan Stanley

    Tuesday, April 05, 2011

    Memo from
    Kneller, Theodore

    CFTC Staff :
    Phyllis Cela
    Ananda Radhakrishnan
    Peter Sanchez
    Katie Driscoll
    Ted Kneller

    External Attendees :
    Soo-Mi Lee
    Nancy King
    William McCoy
    James Hill
    Rick Ostrander
    Candice Koederitz

    Additional Information :
    The external attendees expressed general concerns about the proposed Business Conduct Standards rules and addressed the following issues:
    1. The proposed Business Conduct Standards rules under the Commission’s discretionary rulemaking authority should be self-regulatory organization rules rather than Commission rules.
    2. The proposed Business Conduct Standards rules may create liability for a swap dealer under a private right of action.
    3. The proposed trading ahead rule should be limited to executable orders.
    4. A swap dealer should only be subject to the proposed rule regarding “swap dealer that acts as an advisor to a Special Entity” if the swap dealer and Special Entity agree that the swap dealer is its advisor.  
    5. Adoption and implementation of the proposed execution standards should be delayed to allow time for swap execution facilities to develop.
    6. Comments on Swap Trading Relationship Documentation Requirements: Agreement on swap valuation methodologies is impractical as counterparties may have legitimately different views on the value of a swap.  Focus should instead be on dispute resolution and ISDA has been working with the industry to develop a uniform dispute resolution methodology.
    7. Comments on Confirmation, Portfolio Reconciliation, and Portfolio Compression Requirements: One business day for swap valuation dispute resolution is not workable.  ISDA has been working with the industry to develop a uniform dispute resolution methodology.

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