Guidance on the Effective Date of Section 716 of Dodd-Frank
/1/ Section 716 of Public Law 111-203, 124
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SUPPLEMENTARY INFORMATION: Section 716 prohibits the provision of Federal assistance to any entity defined under that section to be a swaps entity with respect to any swap, security-based swap, or other activity of the swaps entity. /2/ "Federal assistance" is defined for purposes of section 716 as "the use of any advances from any Federal Reserve credit facility or discount window that is not part of a program with broad-based eligibility under section 13(3)(A) of the Federal Reserve Act," and "[
FOOTNOTE 2 See, section 716(a) of the Dodd-Frank Act; 15 U.S.C. 8305(a). END FOOTNOTE
FOOTNOTE 3 See, section 716(b)(1) of the Dodd-Frank Act; 15 U.S.C. 8305(b)(1). END FOOTNOTE
The prudential regulator (as defined in the Commodity Exchange Act) /4/ of a swaps entity is authorized to prescribe rules implementing section 716 with respect to that swaps entity. /5/ The Board is the prudential regulator for state member banks, bank holding companies, savings and loan holding companies, state branches and agencies of foreign banks, and certain other swaps entities. /6/ In addition, the Board is charged with responsibility for establishing and overseeing the provision of credit through any Federal Reserve credit facility and the discount window. The
FOOTNOTE 4 Pursuant to section 711 of the Dodd-Frank Act, the term "prudential regulator" as used in section 716 has the same meaning as in the Commodity Exchange Act. 15 U.S.C. 8301. END FOOTNOTE
FOOTNOTE 5 Section 716(k) of the Dodd-Frank Act; 15 U.S.C. 8305(k). END FOOTNOTE
FOOTNOTE 6 See 7 U.S.C. 1a(39)(A). END FOOTNOTE
FOOTNOTE 7 See id. at section 1a(39)(C). END FOOTNOTE
FOOTNOTE 8 See id. at section 1a(39)(B). END FOOTNOTE
Section 716(h) provides that its general prohibition on Federal assistance is "effective 2 years following the date on which this Act is effective." /9/ Section 716 is contained in Title VII of the Dodd-Frank Act. Section 701 in Title VII provides that Title VII may be cited as the "Wall Street Transparency and Accountability Act of 2010." /10/ Thus, while enacted within the Dodd-Frank Act, Title VII is itself "an Act," and references within Title VII to "this Act" should be, in context, interpreted as references to the Wall Street Transparency and Accountability Act of 2010, not to the broader Dodd-Frank Act. This interpretation is supported by the fact that section 716(m) refers specifically to the Dodd-Frank Act by name--a reference that would not be necessary if the reference to "this Act" in section 716(h) and other provisions of the Wall Street Transparency and Accountability Act were intended to refer to the Dodd-Frank Act. Nothing in the context of subsection (m) or other provisions of section 716 suggest a different reading was intended. /11/
FOOTNOTE 9 See section 716(h) of the Dodd-Frank Act; 15 U.S.C. 8305(h). END FOOTNOTE
FOOTNOTE 10 See section 701 of the Dodd-Frank Act; 15 U.S.C. 8301 note. END FOOTNOTE
FOOTNOTE 11 Section 716(m) of the Dodd-Frank Act; 15 U.S.C. 8305(m). END FOOTNOTE
In general, the Wall Street Transparency and Accountability Act became effective on
FOOTNOTE 12 Section 754 sets forth the effective date of subtitle A of Title VII, and section 774 sets forth the effective date of subtitle B of Title VII. See 7 U.S.C. 7a note and 15 U.S.C. 77b note. END FOOTNOTE
FOOTNOTE 13 The agencies intend to invite comment on a separate proposal that would establish the appropriate transition period for insured depository institutions pursuant to section 716(f). END FOOTNOTE
Comptroller of the Currency.
By order of the
Secretary of the Board.
Notice of joint guidance.
Citation: "77 FR 27456"
Federal Register Page Number: "27456"
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