| Reminder for Companies Planning to Rely on the “End-User Exception” for Swaps Activities |
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On Monday, September 9, new CFTC rules will take effect for non-financial companies that use swaps to hedge or mitigate commercial risk. These rules will require the clearing of interest rate swaps and credit default index swaps unless an exception is available.
One such exception is the “end-user exception,” and public companies planning to rely on this exception must take certain governance steps. These include obtaining approval from the board of directors or an appropriate committee to enter into swaps exempt from clearing. For more information on these governance steps, please see our June 17, 2013 client alert entitled “Public Companies and the ‘End-User Exception’ for Swaps: Governance Action Items,” which is available here. |
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