Galen Stops looks at how extraterritoriality has exacerbated the schism within the CFTC.
At the end of last week the Commodities Futures Trading
Commission approved proposed interpretive guidance regarding
the cross-border application of the swaps provisions of the
The release went on to say: "The vote was conducted via
seriatim, which was approved by all five commissioners."
However, while the proposed guidance may have been approved
by all five commissioners, this is not to say that all five of
the commissioners approve of the guidance being given. As
reported by FOWintelligence, the proposed guidance has exposed
the divide within the CFTC regarding the level of cross-border
jurisdiction being claimed by the Commission.
On one side of the debate are Commissioners Gary Gensler and
Bart Chilton, who claim that today’s global
financial markets mean that risks taken abroad can directly
impact the US economy and point to a number of examples where
financial failures in non-US countries have done exactly
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