§ 240.3a71-1 Definition of “security-based swap dealer.”  


Latest version.
  • (a) General. The term security-based swap dealer in general means any person who:

    (1) Holds itself out as a dealer in security-based swaps;

    (2) Makes a market in security-based swaps;

    (3) Regularly enters into security-based swaps with counterparties as an ordinary course of business for its own account; or

    (4) Engages in any activity causing it to be commonly known in the trade as a dealer or market maker in security-based swaps.

    (b) Exception. The term security-based swap dealer does not include a person that enters into security-based swaps for such person's own account, either individually or in a fiduciary capacity, but not as a part of regular business.

    (c) Scope of designation. A person that is a security-based swap dealer in general shall be deemed to be a security-based swap dealer with respect to each security-based swap it enters into, regardless of the type, class, or category of the security-based swap or the person's activities in connection with the security-based swap, unless the Commission limits the person's designation as a security-based swap dealer to specified types, classes, or categories of security-based swaps or specified activities of the person in connection with security-based swaps.

    (d) Inter-affiliate activities—(1) General. In determining whether a person is a security-based swap dealer, that person's security-based swaps with majority-owned affiliates shall not be considered.

    (2) Meaning of majority-owned. For these purposes the counterparties to a security-based swap are majority-owned affiliates if one counterparty directly or indirectly owns a majority interest in the other, or if a third party directly or indirectly owns a majority interest in both counterparties to the security-based swap, where “majority interest” is the right to vote or direct the vote of a majority of a class of voting securities of an entity, the power to sell or direct the sale of a majority of a class of voting securities of an entity, or the right to receive upon dissolution or the contribution of a majority of the capital of a partnership.

    [78 FR 30751, May 23, 2013]

[78 FR 30751, May 23, 2013