Administration Proposes Legislation to Regulate OTC Derivatives

The Administration delivered legislative language to Capitol Hill today focusing on the regulatory reform of over-the-counter (OTC) derivatives.  Under the Administration's legislation, the OTC derivative markets will be comprehensively regulated for the first time.  The Administration's announcement states that the legislation will provide for regulation and transparency for all OTC derivative transactions; strong prudential and business conduct regulation of all OTC derivative dealers and other major participants in the OTC derivative markets; and improved regulatory and enforcement tools to prevent manipulation, fraud, and other abuses in these markets.

Putting itself on the back, the Administration states that:

Today's delivery marks an important new milestone, as the Administration has now delivered a comprehensive package of financial regulatory reform legislation to Capitol Hill.  Less than two months since the release of its white paper, "Financial Regulatory Reform: A New Foundation," on June 17, the Administration has successfully translated all of its proposals into detailed legislative text – a remarkable effort in both speed and scope.  The Administration looks forward to working with Congress to pass a comprehensive regulatory reform bill by the end of the year.

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