October 19, 2011, Chicago and New York - National Futures Association (NFA) and Bloomberg L.P. today announced that they have entered into an agreement that could pave the way for NFA to perform regulatory services for Bloomberg's swap execution facility (SEF). Upon the issuance of the CFTC's final SEF rules, NFA and Bloomberg hope to enter into a separate Regulatory Services Agreement.
Under the Dodd-Frank Act, SEFs will have surveillance and self-regulatory responsibilities. The Commodity Futures Trading Commission (CFTC) has proposed allowing SEFs to contract with a registered futures association, such as NFA, or another registered entity for regulatory services.
"This is a significant step forward as we engage in new regulatory activity on behalf of SEFs. For over ten years, NFA has been successfully performing trade practice and market surveillance functions on behalf of futures exchanges," said NFA President Daniel J. Roth. "We look forward to utilizing our experience and expertise as we enhance our surveillance systems to assist SEFs meet their regulatory responsibilities."
Ben Macdonald, Bloomberg's Global Head of Fixed Income, said, "Our agreement with NFA gives us the additional capacity and resources needed to meet the requirements of the Dodd-Frank Act. This is one more step forward in ensuring we are ready to register as a swap execution facility."