CFTC and SEC will determine which contracts must be cleared, Gensler confirms

Gary Gensler, chairman of the Commodity Futures Trading Commission, has said the futures regulator and the Securities and Exchange Commission will decide which contracts will be required by law to be cleared by a central counterparty. Gensler had previously said that the decision as to which contracts that what would be required to be traded on exchanges and cleared by central counterparties would be left to clearing houses.

Gensler delivered his commitment on November 5 in a letter of response to Barney Frank’s, a Democrat Congressman from Massachusetts and chairman of the committee on financial services, letter to the CFTC chairman. Frank wrote to Gensler on November 3 to detail his intention to attach two amendments to the proposed reform legislation of the over-the-counter (OTC) derivatives market.

The committee...