AFIA supports delay of reform act swap-related provision

Extension will 'enable completion of the implementation process in an orderly way'

The Commodity Futures Trading Commission‘s proposed order to grant temporary relief of implementation dates for two categories of Title VII of the Dodd-Frank Wall Street Reform & Consumer Protection Act has gained the support of the American Feed Industry Association.

The extension specifically relates to rulemaking that includes the definition of a swap, swap dealer and other swap related terms, which are in process. This proposed action will delay the swap-related provisions of the law, which are scheduled to go into effect on July 16, until Dec. 31 or earlier. “We feel this is a prudent move on the part of the CFTC to enable completion of the implementation process in an orderly way and to ensure current practices for bona fide hedgers and end-users of agricultural commodities are not unduly disrupted during the transition,” said AFIA’s president and CEO Joel G. Newman. 

Agriculture commodity markets were established to provide an efficient price discovery mechanism and a hedging/risk management tool for producers and end users, said AFIA. It is critical in this rulemaking and implementation process that bona fide end users and hedgers of agricultural commodities do not lose the efficient use of this important tool and that they are not subject to additional costs or burdensome regulations.