The Federal Deposit Insurance Corporation ("FDIC"), Office of the Comptroller of the Currency ("OCC"), Board of Governors of the Federal Reserve System ("Federal Reserve"), Securities and Exchange Commission ("SEC") and Commodity Futures Trading Commission ("CFTC") (collectively, the "Agencies") have finalized or shortly will finalize revisions to certain sections of the Volcker Rule (the "2019 Revisions").1 The 2019 Revisions implement changes that had been proposed by the Agencies in a May 2018 notice of proposed rulemaking ("2018 Proposal").2
Subject to the statutory constraints, the 2019 Revisions are intended to (i) establish a more risk-based approach, (ii) make the implementation of the regulation more efficient and less burdensome by reducing its complexity, and (iii) update the existing regulations to reflect the experience of the industry and the regulators. The 2019 Revisions address many of the implementation and compliance issues raised by the proprietary trading and compliance program sections of current regulation and some of the issues related to the covered fund section; however, the 2019 Revisions do not address the comments by market participants on the covered fund section. The Agencies have indicated that they intend to issue a notice of proposed rulemaking at a later date to address additional potential changes that the Agencies are considering for the covered fund section. The 2019 Revisions will become effective on January 1, 2020 and compliance with them will be required on January 1, 2021, although there is an option for early adoption at a banking entity's election.
A Mayer Brown Legal Update will be released shortly.
1 FDIC Approves Interagency Final Rule to Simplify and Tailor the "Volcker Rule," (Aug. 20, 2019), available at https://bit.ly/30iYXz6. The Comptroller of the Currency indicated on August 20, 2019 that he had approved the 2019 Revisions on behalf of the OCC. The Federal Reserve, SEC, and CFTC are expected to approve the 2019 Revisions in the coming weeks.
2 83 Fed. Reg. 33,432 (proposed July 17, 2018). See our alert on the 2018 Proposal: https://bit.ly/2ZuX1q4.
Originally published in REVERSEinquiries: Volume 2, Issue
Click here to read the articles in this latest edition.
Visit us at mayerbrown.com
Mayer Brown is a global legal services provider comprising legal practices that are separate entities (the "Mayer Brown Practices"). The Mayer Brown Practices are: Mayer Brown LLP and Mayer Brown Europe – Brussels LLP, both limited liability partnerships established in Illinois USA; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales (authorized and regulated by the Solicitors Regulation Authority and registered in England and Wales number OC 303359); Mayer Brown, a SELAS established in France; Mayer Brown JSM, a Hong Kong partnership and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. "Mayer Brown" and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.
© Copyright 2019. The Mayer Brown Practices. All rights reserved.
This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.