On April 18 the Commodity Futures Trading Commission (“CFTC”) and the Securities and Exchange Commission (“SEC”) approved a final rule defining the terms “swap dealers,” “major swap participants,” and “eligible contract participants.” Many market participants were pleased that the regulators appeared to have listened to their concerns and defined the terms “swap dealers” and “major swap participants” in such a way that will not capture the vast majority of derivatives end users. The final rule provided less comfort to small end users, however, who may find that they will no longer be able to enter into over-the-counter derivative transactions because they do not qualify as “eligible contract participants.” – Major Swap Participants (“MSPs”): The final rule appears to be consistent with Congressional intent to focus the MSP definition on entities whose derivatives use is so material that the failure of…

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