Chairman Conaway and Ranking Member Boswell,
Thank you for scheduling today’s hearing on Representatives Rick Crawford (R-AR) and Terry Sewell’s (D-AL) bipartisan legislation, introduced with Representatives Robert Dold (R-IL) and Gwen Moore (D-MI), to address the indemnification provisions and modify the confidentiality requirements in the Dodd-Frank Wall Street Reform and Consumer Protection Act (DFA). I appreciate the opportunity to testify and bring greater attention to the unintended consequences of these provisions, which have the potential to fragment the current global data set for over-the-counter (OTC) derivatives and derail efforts to increase transparency and help regulators mitigate risk in this marketplace.
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.
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.
Download the Congressional Testimony: Testimony before the House Agriculture Subcommittee on General Farm Commodities and Risk Management