Testimony before the House Agriculture Subcommittee on General Farm Commodities and Risk Management

Michael Bodson, Chief Operating Officer

The House Agriculture Committee’s leadership is vital as there is a clear need to shine a light on these technical provisions of the DFA – provisions that, if not addressed, risk decreasing the current level of transparency into OTC derivatives markets. Having a bipartisan group of Members in both the House and Senate recognize the unintended consequences of these provisions and commit to working within Congress and with policymakers internationally to develop a mutually agreeable resolution is very promising.

Testimony before the House Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises

Donald F. Donahue, President and Chief Executive Officer

Over the past year, DTCC, among others, has been raising concerns over the impact of the DFA’s broad extraterritorial reach, particularly as it relates to the confidentiality of market data and the indemnification agreement provisions of the law. These concerns have been echoed by regulatory officials and policymakers globally, including by representatives of the European Parliament, European Commission and Council, by Asian governments and by both Republican and Democratic Members of the U.S. Congress.

DTCC Statement for the Record, House Committee on Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises

Larry E. Thompson, Managing Director and General Counsel

DTCC remains concerned about the combined impact of the DFA’s broad extraterritorial reach and the confidentiality and indemnification agreement provisions. These provisions are fundamentally unworkable, as they do not recognize either foreign legal systems, or the inability of the U.S. to accept reciprocal demands from foreign entities. For reasons set forth in this statement, these provisions risk fragmenting the global data for over-the counter (OTC) derivatives and undermining efforts to increase market transparency and to mitigate risk in this market.
February 8, 2012

Testimony Before House Committee on Agriculture, Nutrition, and Forestry Subcommittee on General Farm Commodities and Risk Management

Larry E. Thompson, Managing Director and General Counsel

The underlying legislative intent of the Dodd-Frank Act could therefore be subverted by the indemnification requirements in the data security provisions of the legislation, which could prevent the exchange of information between regulators and frustrate efforts to identify and mitigate international financial risk and fragment regulatory oversight on a jurisdiction-by-jurisdiction basis.
May 25, 2011

Testimony Before U.S. Senate Committee on Agriculture, Nutrition, and Forestry

Larry E. Thompson, Managing Director and General Counsel
Based on our experience in constructing and managing the world’s first and most comprehensive derivatives repository, we are convinced that a properly constructed SDR system will play a fundamental role to promote more transparent markets for global regulatory oversight and systemic risk mitigation, protect the public and help ensure liquid and efficient capital markets.
March 3, 2011

Testimony Before U.S. House Committee on Financial Services

Don Donahue, President and Chief Executive Officer
DTCC shares Congress’ goal of ensuring more transparent markets for global regulatory oversight and systemic risk mitigation, protecting the public and ensuring liquid and efficient capital markets. Finally, it is our strong belief that while many of the regulatory aspects of Dodd-Frank Act remain in development, transparency is a policy option that is most ripe for implementation.
February 15, 2011

Testimony Before U.S. Senate Committee on Agriculture, Nutrition, and Forestry

Peter Axilrod, Managing Director
DTCC supports the broad goals of the Administration’s approach to addressing systemic risk. We also share the assessment that meaningful transparency to regulators and the public at large requires that all OTC derivatives either be cleared through a regulated central counterparty or else registered in a regulated repository. But in the area of trade reporting, we believe further refinement is needed to assure that potentially serious unintended consequences are avoided.
December 2, 2009

Testimony Before U.S. House Committee on Financial Services

Larry E. Thompson, Managing Director and General Counsel
Our testimony will focus principally on one aspect that we strongly believe undermines the goals of re-regulation and represents a step backward by reducing the level of transparency that now exists. As you will note, we believe strongly that regulators and the public need a consolidated source of market information. However, the various proposals under consideration will result in fragmentation of that information. We present a specific proposal to remedy that situation.
October 7, 2009

Testimony Before U.S. House Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises

Larry E. Thompson, Managing Director and General Counsel
Fragmentation of data in the financial industry can impede the ability of regulators to protect investors and the integrity of the financial services system as a whole. These core policy goals are advanced when information on trades are held on a centralized basis. We believe maintaining a single trade repository for OTC derivatives contracts is an essential element of safety and soundness for two primary reasons.
June 9, 2009