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Bill114th CongressFiled Mar 4, 2015Finance and Financial Sector
H.R. 1317

To amend the Commodity Exchange Act and the Securities Exchange Act of 1934 to specify how clearing requirements apply to certain affiliate transactions, and for other purposes.

Bill journey · stage 2 of 5

Under committee review

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What it doesSummary passed house amended (Nov 16, 2015)

(This measure has not been amended since it was reported to the House on October 26, 2015. The summary of that version is repeated here.)

(Sec. 1) This bill amends the Commodity Exchange Act and the Securities Exchange Act of 1934 regarding clearing requirements for certain affiliate swap transactions to revise the conditions under which an affiliate of a person that qualifies for an exception from clearing requirements may itself qualify for such exceptions.

The affiliate must be:

  • directly and wholly-owned by another affiliate qualified for the exception or an entity that is not a financial entity;
  • not indirectly majority-owned by a financial entity;
  • not ultimately owned by a parent company that is a financial entity; and
  • an affiliate that does not provide any services, financial or otherwise, to any affiliate that is a nonbank financial company supervised by the Board of Governors of the Federal Reserve System.

The bill disqualifies for the exceptions, however, any affiliate that is:

  • a swap dealer, a security-based swap dealer, a major swap participant, a major security-based swap participant, or a commodity pool (all disqualified under current law);
  • a bank holding company (not, as under current law, only a bank holding company with over $50 billion in consolidated assets);
  • a specified kind of private fund;
  • an employee benefit plan or government plan under the Employee Retirement Income Security Act of 1974 (ERISA);
  • an insured depository institution;
  • a farm credit system institution;
  • a credit union;
  • a nonbank financial company supervised by the Federal Reserve Board; or
  • an entity engaged in the business of insurance and subject to state or foreign government capital requirements.

Unless the Commodity Futures Trading Commission or the Securities and Exchange Commission determines it is in the public interest, however, the exception from clearing requirements shall not apply to an affiliate that is itself affiliated with: (1) a major security-based swap participant; (2) a security-based swap dealer; (3) a major swap participant; or (4) a swap dealer.

An affiliate that does qualify for the exception from clearing requirements may not enter into any swap other than to hedge or mitigate commercial risk.

The bill also prohibits the affiliate, and any person affiliated with the affiliate that is not a financial entity, from:

  • entering into a swap with or on behalf of any affiliate that is a financial entity; or
  • otherwise assuming, netting, combining, or consolidating the risk of swaps entered into by any such financial entity, except an affiliate that qualifies for the exception from clearing requirements.

Any swap entered into by an affiliate that qualifies for the exception from clearing requirements shall be subject to the affiliate's centralized risk management program, provided it is designed both to: (1) monitor and manage swap associated risks, and (2) identify each affiliate upon whose behalf a swap was entered into.

What just happenedNov 17, 2015

Received in the Senate and Read twice and referred to the Committee on Agriculture, Nutrition, and Forestry.

Who’s behind it

Rep. Moore, Gwen [D-WI-4](D-WI)Sponsor
3 cosponsors1 D2 R
Read on Congress.gov
3cosponsors3committees23actions4related bills2subjects
  1. Nov 17, 2015IntroReferral

    Received in the Senate and Read twice and referred to the Committee on Agriculture, Nutrition, and Forestry.

    Agriculture, Nutrition, and Forestry Committee
  2. Nov 16, 2015FloorH38310

    Motion to reconsider laid on the table Agreed to without objection.

  3. Nov 16, 2015FloorH37300

    On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote. (text: CR H8219-8220)

  4. Nov 16, 2015Floor8000

    Passed/agreed to in House: On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote.(text: CR H8219-8220)

  5. Nov 16, 2015FloorH8D000

    DEBATE - The House proceeded with forty minutes of debate on H.R. 1317.

  6. Nov 16, 2015FloorH30000

    Considered under suspension of the rules. (consideration: CR H8219-8221)

  7. Nov 16, 2015FloorH30300

    Mr. Hensarling moved to suspend the rules and pass the bill, as amended.

  8. Nov 16, 2015CalendarsH12410

    Placed on the Union Calendar, Calendar No. 259.

  9. Nov 16, 2015CommitteeH12200

    Reported (Amended) by the Committee on Financial Services. H. Rept. 114-311, Part II.

    Financial Services Committee
  10. Nov 16, 2015Committee5000

    Reported (Amended) by the Committee on Financial Services. H. Rept. 114-311, Part II.

    Financial Services Committee
  11. Oct 26, 2015CommitteeH12200

    Reported (Amended) by the Committee on Agriculture. H. Rept. 114-311, Part I.

    Agriculture Committee
  12. Oct 26, 2015Committee5000

    Reported (Amended) by the Committee on Agriculture. H. Rept. 114-311, Part I.

    Agriculture Committee
  13. Sep 30, 2015Committee

    Ordered to be Reported (Amended).

    Agriculture Committee
  14. Sep 30, 2015Committee

    Committee Consideration and Mark-up Session Held.

    Agriculture Committee
  15. Jul 29, 2015Committee

    Ordered to be Reported (Amended) by the Yeas and Nays: 57 - 0.

    Financial Services Committee
  16. Jul 29, 2015Committee

    Committee Consideration and Mark-up Session Held.

    Financial Services Committee
  17. Apr 29, 2015Committee

    Hearings Held by the Subcommittee on Capital Markets and Government Sponsored Enterprises Prior to Referral.

    Capital Markets Subcommittee
  18. Mar 23, 2015Committee

    Referred to the Subcommittee on Commodity Exchanges, Energy, and Credit.

    Commodity Markets, Digital Assets, and Rural Development Subcommittee
  19. Mar 4, 2015IntroReferralH11100

    Referred to the Committee on Financial Services, and in addition to the Committee on Agriculture, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.

    Agriculture Committee
  20. Mar 4, 2015IntroReferralH11100-A

    Referred to the Committee on Financial Services, and in addition to the Committee on Agriculture, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.

  21. Mar 4, 2015IntroReferralH11100

    Referred to the Committee on Financial Services, and in addition to the Committee on Agriculture, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.

    Financial Services Committee
  22. Mar 4, 2015IntroReferralIntro-H

    Introduced in House

  23. Mar 4, 2015IntroReferral1000

    Introduced in House

Passed House amendedNov 16, 201536

(This measure has not been amended since it was reported to the House on October 26, 2015. The summary of that version is repeated here.)

(Sec. 1) This bill amends the Commodity Exchange Act and the Securities Exchange Act of 1934 regarding clearing requirements for certain affiliate swap transactions to revise the conditions under which an affiliate of a person that qualifies for an exception from clearing requirements may itself qualify for such exceptions.

The affiliate must be:

  • directly and wholly-owned by another affiliate qualified for the exception or an entity that is not a financial entity;
  • not indirectly majority-owned by a financial entity;
  • not ultimately owned by a parent company that is a financial entity; and
  • an affiliate that does not provide any services, financial or otherwise, to any affiliate that is a nonbank financial company supervised by the Board of Governors of the Federal Reserve System.

The bill disqualifies for the exceptions, however, any affiliate that is:

  • a swap dealer, a security-based swap dealer, a major swap participant, a major security-based swap participant, or a commodity pool (all disqualified under current law);
  • a bank holding company (not, as under current law, only a bank holding company with over $50 billion in consolidated assets);
  • a specified kind of private fund;
  • an employee benefit plan or government plan under the Employee Retirement Income Security Act of 1974 (ERISA);
  • an insured depository institution;
  • a farm credit system institution;
  • a credit union;
  • a nonbank financial company supervised by the Federal Reserve Board; or
  • an entity engaged in the business of insurance and subject to state or foreign government capital requirements.

Unless the Commodity Futures Trading Commission or the Securities and Exchange Commission determines it is in the public interest, however, the exception from clearing requirements shall not apply to an affiliate that is itself affiliated with: (1) a major security-based swap participant; (2) a security-based swap dealer; (3) a major swap participant; or (4) a swap dealer.

An affiliate that does qualify for the exception from clearing requirements may not enter into any swap other than to hedge or mitigate commercial risk.

The bill also prohibits the affiliate, and any person affiliated with the affiliate that is not a financial entity, from:

  • entering into a swap with or on behalf of any affiliate that is a financial entity; or
  • otherwise assuming, netting, combining, or consolidating the risk of swaps entered into by any such financial entity, except an affiliate that qualifies for the exception from clearing requirements.

Any swap entered into by an affiliate that qualifies for the exception from clearing requirements shall be subject to the affiliate's centralized risk management program, provided it is designed both to: (1) monitor and manage swap associated risks, and (2) identify each affiliate upon whose behalf a swap was entered into.

Reported to House amended, Part IOct 26, 201518

(Sec. 1) This bill amends the Commodity Exchange Act and the Securities Exchange Act of 1934 regarding clearing requirements for certain affiliate swap transactions to revise the conditions under which an affiliate of a person that qualifies for an exception from clearing requirements may itself qualify for such exceptions.

The affiliate must be:

  • directly and wholly-owned by another affiliate qualified for the exception or an entity that is not a financial entity;
  • not indirectly majority-owned by a financial entity;
  • not ultimately owned by a parent company that is a financial entity; and
  • an affiliate that does not provide any services, financial or otherwise, to any affiliate that is a nonbank financial company supervised by the Board of Governors of the Federal Reserve System.

The bill disqualifies for the exceptions, however, any affiliate that is:

  • a swap dealer, a security-based swap dealer, a major swap participant, a major security-based swap participant, or a commodity pool (all disqualified under current law);
  • a bank holding company (not, as under current law, only a bank holding company with over $50 billion in consolidated assets);
  • a specified kind of private fund;
  • an employee benefit plan or government plan under the Employee Retirement Income Security Act of 1974 (ERISA);
  • an insured depository institution;
  • a farm credit system institution;
  • a credit union;
  • a nonbank financial company supervised by the Federal Reserve Board; or
  • an entity engaged in the business of insurance and subject to state or foreign government capital requirements.

Unless the Commodity Futures Trading Commission or the Securities and Exchange Commission determines it is in the public interest, however, the exception from clearing requirements shall not apply to an affiliate that is itself affiliated with: (1) a major security-based swap participant; (2) a security-based swap dealer; (3) a major swap participant; or (4) a swap dealer.

An affiliate that does qualify for the exception from clearing requirements may not enter into any swap other than to hedge or mitigate commercial risk.

The bill also prohibits the affiliate, and any person affiliated with the affiliate that is not a financial entity, from:

  • entering into a swap with or on behalf of any affiliate that is a financial entity; or
  • otherwise assuming, netting, combining, or consolidating the risk of swaps entered into by any such financial entity, except an affiliate that qualifies for the exception from clearing requirements.

Any swap entered into by an affiliate that qualifies for the exception from clearing requirements shall be subject to the affiliate's centralized risk management program, provided it is designed both to: (1) monitor and manage swap associated risks, and (2) identify each affiliate upon whose behalf a swap was entered into.

Introduced in HouseMar 4, 2015

Amends the Commodity Exchange Act and the Securities Exchange Act of 1934 to revise the treatment of affiliate transactions that may be exempt from clearing requirements to authorize such an exemption only if the affiliate enters into the swap to hedge or mitigate the commercial risk of the person that is not a financial entity (as under current law), provided that an appropriate credit support measure or other mechanism must be used if the hedge or mitigation of commercial risk is addressed by entering into a swap with either: (1) a swap dealer or major swap participant, or (2) a security-based swap with a security-based swap dealer or major security-based swap participant.

To amend the Commodity Exchange Act and the Securities Exchange Act of 1934 to specify how… — Informed