AFP Commends House Passage of End-User Exemption on Margin Requirements for OTC Derivatives Trading

Seeks to preserve corporate access to important risk management tools

Mar 29, 2012, 16:25 ET from Association for Financial Professionals

WASHINGTON, March 29, 2012 /PRNewswire/ -- The Association for Financial Professionals (AFP), the professional society representing corporate treasurers, CFOs and their staff, issued the following statement on passage by the U.S. House of Representatives of H.R. 2682, the Business Risk Mitigation and Price Stabilization Act, which would clarify the intent of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Dodd-Frank Act exempts non-financial end-users from imposed-margin requirements on over-the-counter (OTC) derivatives trading.

"Monday's overwhelming passage of the end-user exemption in the House of Representatives signals a broad consensus that regulatory requirements imposed under Dodd-Frank were not meant for companies that use derivatives for the purpose of safe and responsible financial risk management," said Jim Kaitz, AFP's president and CEO.

"AFP members have worked hard to clarify the distinction. We commend the House of Representatives for passing this legislation, and urge the Senate to promptly follow suit."

AFP has been a leading voice for non-financial businesses, which utilize OTC derivatives to minimize their risk exposures and to follow prudent financial management practices. Since regulators solicited comments on the new rules governing the OTC derivatives markets, AFP has advocated strongly in favor of this critical exemption for non-financial end-users.

In its 2011 comment letter to federal agencies overseeing derivatives, AFP warned that imposing margin requirements on non-financial end-users would "inadvertently place additional strain on the capital markets, reduce liquidity and add additional stress to an already troubled job market."

For more information, contact Konstantine Kastens in AFP's government relations department at 301.907.2862 or via

The Association for Financial Professionals (AFP), headquartered outside Washington, D.C., serves a network of more than 16,000, members with news, economic research and data, treasury certification programs, networking events, financial analytical tools, training, and public policy representation to legislators and regulators. AFP is the daily resource for the finance profession ( AFP's global reach extends to over 150,000 treasury and financial professionals worldwide, including AFP of Canada; London-based gtnews, an on-line resource for the treasury and finance community; and bobsguide, a financial IT solutions network.

SOURCE Association for Financial Professionals