Published on
June 30, 2026
SEC and CFTC seek comment on derivatives rules
SEC and CFTC request comments to harmonize swap and security-based swap definitions and alternative compliance under Title VII.
The Securities and Exchange Commission and the Commodity Futures Trading Commission have opened a joint review of how U.S. derivatives rules are drawn, asking the public to weigh in on whether key product definitions and compliance frameworks need to be updated.
The request for comment, issued on June 18, 2026, centers on Title VII of the Dodd-Frank Wall Street Reform Act, which split oversight of swaps markets between the two agencies. Comments are due on or before August 24, 2026.
In the agencies’ words, the review covers "potential opportunities to further update, clarify and harmonize certain derivatives product definitions and interpretive issues." The filing is aimed at reducing regulatory gaps and giving regulated entities greater certainty, according to the source article.
Focus on definitions and alternative compliance
The request for comment contains 15 questions in two sections. The first addresses the definitions of "swap" and "security-based swap" (SBS). The second looks at alternative compliance, described in the source as the ability to rely on compliance with one agency’s rules in order to comply with the rules of the other.
Title VII created the basic jurisdictional split: the CFTC generally oversees swaps markets under the Commodity Exchange Act of 1936, while the SEC generally oversees SBS markets under the Securities Exchange Act of 1934. The source article notes that mixed swaps can fall under the concurrent jurisdiction of both agencies.
The agencies said in the text of the request: "The Commissions jointly request public comment on potential ways to draw clearer regulatory lines for agency oversight of innovative products that may implicate the regulatory interests of both Commissions. The Commissions request comment on principled, objective criteria that could be used to provide additional clarity for these products within the Title VII framework. Public input will help the Commissions evaluate potential steps in light of technological developments, accumulated experience, and evolving market practices."
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Event contracts remain a priority
A major theme in the review is event contracts. The source article says commissioners from both agencies have previously called for coordination in this area because event contracts frequently fall within the definition of "swap."
In September 2025, SEC Chair Paul Atkins and then-Acting CFTC Chair Caroline Pham said in a joint statement that "[t]he SEC and CFTC should examine opportunities to collaborate to consider where event contracts may be made available to U.S. market participants regardless of where the jurisdictional lines fall."
The new request for comment says questions are continuing to emerge. As the source article notes, the agencies explain that "market participants are raising questions about whether certain event contracts are swaps, SBS, or mixed swaps, or types of instruments that fall within statutory exclusions from the ‘swap’ definition."
Among the specific questions, the agencies ask whether they should issue new or revised rules or interpretations to address event contracts and other innovative products. They also ask whether more clarity is needed on when an event "directly affects" the financial statements, financial condition or financial obligations of an issuer, which would place it within the SEC’s SBS jurisdiction under the statutory framework described in the source.
Questions also reach perpetual contracts and structured products
The review is not limited to event contracts. The agencies are also seeking input on cash-settled perpetual contracts, including whether a contract referencing an equity security could be treated as a security future rather than an SBS under the Exchange Act.
The text of the request asks: "Is there a need for greater clarity from the Commissions regarding the treatment of futures, including security futures, in the context of innovative markets? For example, is there a need for greater clarity regarding whether a cash-settled "perpetual" contract referencing an equity security could be treated as a security future? What effects could the introduction of such products have on liquidity formation, price discovery, and hedging activity, particularly with regards to the derivatives and underlying cash equity markets?"
The agencies are also examining exclusions from the definitions of swap and SBS, including traditional debt instruments such as notes and bonds. In another question from the request, they ask: "Any note, bond, or evidence of indebtedness that is a security as defined in section 2(a)(1) of the Securities Act is excluded from the "swap" definition. In light of innovative products and product structures, but mindful of the existing structured notes market, is there a need to further clarify whether a particular instrument is a note, bond, or evidence of indebtedness that is a security, and thus excluded from the definition of "swap" pursuant to CEA section 1a(47)(B)(vii), as compared to a swap or SBS? For example, what consideration should be given to whether the financial instrument is issued pursuant to an indenture qualified under the Trust Indenture Act of 1939? What consideration should be given to whether the terms of the instrument reflect a lender-borrower relationship? Are there different or additional criteria relevant to distinguishing notes, bonds, and other evidence of indebtedness that are securities from swaps or SBS?"
Alternative compliance under review
The second half of the request turns to whether compliance with one regulator’s framework could satisfy substantially similar requirements of the other when products are economically related or functionally similar.
The request states: "Where trading in economically related or functionally similar product classes implicates both SEC and CFTC regulatory interests, are there circumstances in which compliance with one Commission's regulatory framework could appropriately satisfy substantially similar requirements of the other Commission (alternative compliance)? In this case, how should "substantially similar" be viewed? Should it contemplate scope, objectives and/or outcomes of requirements? Supervisory compliance programs? Enforcement authority? Other considerations/standards?"
The agencies also point to limits on their exemptive authority under Title VII and ask whether joint or coordinated approaches could help facilitate alternative compliance.
Long-running jurisdiction questions
The source article places the new review in a longer history of SEC-CFTC coordination and conflict. It notes that the agencies adopted rules in 2012 to give guidance on the definitions of swap and SBS, following an advance notice of proposed rulemaking in 2010. Even so, the article says that distinguishing among swaps, SBSs and mixed swaps "remains challenging for market participants, regulators and courts."
It cites the 2023 Archegos Capital Management litigation as an example, where both agencies brought charges over total return swaps tied to exchange-traded funds and custom baskets but advanced different theories of jurisdiction. According to the source article, the US District Court for the Southern District of New York dismissed the CFTC’s claims for lack of jurisdiction.
The source article says the current request reflects continued coordination between the agencies and a push toward greater alignment. It adds that the agencies are seeking to harmonize and streamline their regulations while addressing areas of uncertainty around innovative products and overlapping requirements.
