• Department of Labor Paves the Way to Clearing Swaps for ERISA Plans
  • February 22, 2013 | Author: David C. Olstein
  • Law Firm: Skadden, Arps, Slate, Meagher & Flom LLP - New York Office
  • The Department of Labor (DOL) recently issued a long-awaited advisory opinion (the Advisory Opinion) clarifying and confirming the ability of central counterparties (CCPs) and their clearing members (Clearing Members) to clear swaps for pension plans without violating various requirements in the Employee Retirement Income Security Act of 1974 (ERISA). The Advisory Opinion was prompted by the clearing mandate for swaps that is a cornerstone of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank). Recent Commodity Futures Trading Commission (CFTC) rules implemented the mandatory clearing requirement. Under those rules, certain interest-rate swaps and certain credit default swaps will be required to be cleared by September 9, 2013, for pension plans subject to ERISA and by March 11, 2013, for “active funds,” including those that are deemed to hold “plan assets” of pension plans subject to ERISA.