Confirmation, Portfolio Reconciliation, and Portfolio Compression Requirements for Swap Dealers and Major Swap Participants 77 FR 55094 (Dec. 28, 20102)

Forms and Documents

Document Name	Status
(2015) Supporting Statement - 0068.docx Supplementary Document	2015-09-22
(2015) Supporting Statement - 0068.docx Supporting Statement A	2015-09-01

IC Document Collections

IC ID	Document Title	Status
195871	Confirmation, Portfolio Reconciliation, and Portfolio Compression Reauirement for Swap Dealers and Major Swap Participants	Modified

ICR Details

OMB Control No: 3038-0068	ICR Reference No: 201508-3038-005
Status: Historical Inactive	Previous ICR Reference No: 201209-3038-002
Agency/Subagency: CFTC	Agency Tracking No:
Title: Confirmation, Portfolio Reconciliation, and Portfolio Compression Requirements for Swap Dealers and Major Swap Participants 77 FR 55094 (Dec. 28, 20102)
Type of Information Collection: Revision of a currently approved collection	Common Form ICR:  No
Type of Review Request: Regular
OIRA Conclusion Action: Comment filed on proposed rule and continue	Conclusion Date: 10/24/2015
	Date Received in OIRA: 09/22/2015
Terms of Clearance: OMB files this comment in accordance with 5 CFR 1320.11( c ). This OMB action is not an approval to conduct or sponsor an information collection under the Paperwork Reduction Act of 1995. This action has no effect on any current approvals. If OMB has assigned this ICR a new OMB Control Number, the OMB Control Number will not appear in the active inventory. For future submissions of this information collection, reference the OMB Control Number provided. OMB files this comment in accordance with 5 CFR 1320.11( c ). This OMB action is not an approval to conduct or sponsor an information collection under the Paperwork Reduction Act of 1995. This action has no effect on any current approvals. If OMB has assigned this ICR a new OMB Control Number, the OMB Control Number will not appear in the active inventory. For future submissions of this information collection, reference the OMB Control Number provided. Pursuant to 5 CFR 1320.11(c), OMB files this comment on this information collection request (ICR. The agency shall examine public comment in response to the NPRM and will describe in the supporting statement of its next collection any public comments received regarding the collection as well as why (or why it did not) incorporate the commenter’s recommendation. The next submission to OMB must include the draft final rule.

	Inventory as of this Action	Requested	Previously Approved
Expiration Date	02/29/2016	36 Months From Approved	04/30/2016
Responses	1,175,250	0	1,175,250
Time Burden (Hours)	160,313	0	160,313
Cost Burden (Dollars)	16,031,250	0	16,031,250

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Abstract: Section 4s(i) to the Commodity Exchange Act (CEA) requires the Commission to prescribe standards for swap dealers (SDs) and major swap participants (MSPs) related to the timely and accurate confirmation, processing, netting, documentation, and valuation of swaps. These regulations set forth requirements for swap confirmation, portfolio reconciliation, portfolio compression for SDs and MSPs. Under § 23.502, SDs and MSPs must reconcile their swap portfolios with one another and provide non-SD and non-MSP counterparties with regular opportunities for portfolio reconciliation. Section 23.500(i) defines the term, "portfolio reconciliation," as "any process by which the two parties to one or more swaps: (1) exchange the terms of all swaps in the swap portfolio between the counterparties; (2) exchange each counterparty's valuation of each swap in the swap portfolio between the counterparties as of the close of business on the immediately preceding business day; and (3) resolve any discrepancy in material terms and valuations." Section 23.500(g) defines "material terms" to mean "all terms of a swap required to be reported in accordance with part 45 of this chapter." Thus, portfolio reconciliation seeks to enable "the swap market to operate efficiently and to reduce systemic risk" by requiring counterparties periodically to (1) exchange the terms of their mutual swaps, and (2) locate and resolve discrepancies in material terms of mutual swaps. In particular, the Commission recognized that "portfolio reconciliation [would] facilitate the identification and resolution of discrepancies between the counterparties with regard to valuations of collateral held as margin." The Commission's proposal would to alleviate the burden of resolving discrepancies in terms of a swap that are not relevant to the ongoing rights and obligations of the parties and the valuation of the swap, or to the Commission's regulatory mission. The proposed amendment to Regulation 23.500(g) would reduce the number of "material terms" that counterparties would need to resolve for discrepancies in portfolio reconciliation exercises, but would not eliminate the portfolio reconciliation requirement itself.

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Authorizing Statute(s): US Code: 7 USC 6s Name of Law: Definition of
  

Citations for New Statutory Requirements: PL: Pub.L. 111 - 203 124 Stat 1376 (2010) Name of Law: Dodd-Frank Act

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Associated Rulemaking Information
RIN:	Stage of Rulemaking:	Federal Register Citation:	Date:
3038-AE17	Proposed rulemaking	80 FR 57129	09/22/2015

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Federal Register Notices & Comments

Did the Agency receive public comments on this ICR? No

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Number of Information Collection (IC) in this ICR: 1

IC Title	Form No.	Form Name
Confirmation, Portfolio Reconciliation, and Portfolio Compression Reauirement for Swap Dealers and Major Swap Participants

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Burden increases because of Program Change due to Agency Discretion: No

Burden Increase Due to:

Burden decreases because of Program Change due to Agency Discretion: Yes

Burden Reduction Due to: Miscellaneous Actions

Short Statement: The proposed amendment to Regulation 23.500(g) would reduce the number of "material terms" that counterparties would need to resolve for discrepancies in portfolio reconciliation exercises. The Commission believes that the changes proposed to the regulatory definition of "material terms" described herein would reduce the time burden for portfolio reconciliation by one burden hour for each SD and MSP, which would reduce the annual burden to 1,281.5 hours per SD and MSP. There are currently 106 provisionally registered SDs and MSPs and the Commission believes that the proposed rule would result in one hour of less work for computer programmers for SDs and MSPs because the programmers who have to match the needed data fields from two different databases would have fewer data fields to obtain and resolve for discrepancies.

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Annual Cost to Federal Government: $0

Does this IC contain surveys, censuses, or employ statistical methods? No

Is the Supporting Statement intended to be a Privacy Impact Assessment required by the E-Government Act of 2002? No

Is this ICR related to the Affordable Care Act [Pub. L. 111-148 & 111-152]? No

Is this ICR related to the Dodd-Frank Wall Street Reform and Consumer Protection Act, [Pub. L. 111-203]? Yes

Is this ICR related to the American Recovery and Reinvestment Act of 2009 (ARRA)? No

Is this ICR related to the Pandemic Response? Uncollected

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Common Form ICR:  No

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On behalf of this Federal agency, I certify that the collection of information encompassed by this request complies with 5 CFR 1320.9 and the related provisions of 5 CFR 1320.8(b)(3).

The following is a summary of the topics, regarding the proposed collection of information, that the certification covers:

(a) It is necessary for the proper performance of agency functions;

(b) It avoids unnecessary duplication;

(c) It reduces burden on small entities;

(d) It uses plain, coherent, and unambiguous language that is understandable to respondents;

(e) Its implementation will be consistent and compatible with current reporting and recordkeeping practices;

(f) It indicates the retention periods for recordkeeping requirements;

(g) It informs respondents of the information called for under 5 CFR 1320.8 (b)(3) about:

(i) Why the information is being collected;

(ii) Use of information;

(iii) Burden estimate;

(iv) Nature of response (voluntary, required for a benefit, or mandatory);

(v) Nature and extent of confidentiality; and

(vi) Need to display currently valid OMB control number;

(h) It was developed by an office that has planned and allocated resources for the efficient and effective management and use of the information to be collected.

(i) It uses effective and efficient statistical survey methodology (if applicable); and

(j) It makes appropriate use of information technology.

If you are unable to certify compliance with any of these provisions, identify the item by leaving the box unchecked and explain the reason in the Supporting Statement.

Certification Date: 09/22/2015

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