Confirmation, Portfolio Reconciliation, Portfolio Compression, and Swap Trading Relationship Documentation Requirements for Swap Dealers and Major Swap Participants

Section 731 of Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act, Pub L. No. 111-203, 124 Stat. 1376 (2010)) amended the Commodity Exchange Act (CEA) by adding sections 4s(f), 4s(g), and 4s(i), among others. Pursuant to this authority, the Commission promulgated regulations 23.500-23.505, which obligate swap dealers (SDs) and major swap participants (MSPs) to develop and retain written swap trading relationship documentation. The regulations also establish requirements for SDs and MSPs regarding swap confirmation, portfolio reconciliation, and portfolio compression. Confirmation, portfolio reconciliation, and portfolio compression are important, post-trade processing mechanisms for reducing risk and improving operational efficiency, ensuring that each SD and MSP maintain the required records of their business activities and an audit trail sufficient to conduct comprehensive and accurate trade reconstruction.

The latest form for Confirmation, Portfolio Reconciliation, Portfolio Compression, and Swap Trading Relationship Documentation Requirements for Swap Dealers and Major Swap Participants expires 2022-09-30 and is listed under ICR 201907-3038-003.