* SEC defines terms like swap, security-based swap
* CFTC set to vote on joint rule on Tuesday
* SEC does not detail how rule is crafted
* Rule will set in motion compliance dates for banks,
traders
(Adds background, byline)
By Sarah N. Lynch
WASHINGTON, July 9 (Reuters) – U.S. securities regulators on
Monday finalized rules that define what kinds of derivatives
products will be regulated under the new regime created by the
2010 Dodd-Frank Wall Street reform law.
The Securities and Exchange Commission voted unanimously
behind closed doors to approve definitions for terms such as
“swap” and “security-based swap,” according to a statement.
The rules still must be jointly approved by the Commodity
Futures Trading Commission, which is slated to vote on Tuesday
morning at a public meeting.
The rules are a critical part of the Dodd-Frank reforms
because they trigger a countdown for compliance dates that big
swap players like banks will have to follow.
Once the CFTC signs off on the rules and they are published
in the Federal Register, swap dealers will have two months to
sign up with the regulator.
Other regulatory requirements, such as record-keeping and
reporting, will also kick in after the two-month window.
The SEC did not provide any details on the final rules.
But regulators are expected to closely follow the swap
definition that is laid out in the text of the Dodd-Frank law.
Critics have accused the SEC and CFTC of tackling the
various Dodd-Frank derivatives rules out of order, saying they
should have focused on defining a swap before moving on to craft
other regulations.
(Additional reporting by Alexandra Alper; Editing by Gerald E.
McCormick and Leslie Gevirtz)
