SIFMA/SIFMA AMG Product Definitions Joint RFC
Summary
SIFMA, SIFMA AMG, and the International Swaps and Derivatives Association, Inc. (ISDA) (together, the “Associations”) 1 provided comments to the Commodity Futures Trading Commission (CFTC) and Securities and Exchange Commission (SEC) in response to their Joint RFC on Further Definition of “Swap” and “Security-Based Swap” and on Alternative Compliance. 2
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Introduction
The Associations and their respective members appreciate the Commissions’ commitment to coordinating in areas of common regulatory interest to enhance regulatory effectiveness and market integrity with the goal of reducing regulatory gaps and providing greater certainty regarding regulatory responsibility 3 in support of efficient markets and lawful innovation. Members welcome the Joint RFC and are delighted to support the Commissions’ efforts by means of this letter and any further clarification or support the Commissions may require.
For ease of reference, this letter is organized into four sections in the following order: (I) Innovative Products, (II) Established Products, (III) Harmonization and Alternative Compliance, and (IV) General Relief and Safe Harbor. Given the breadth of the Joint RFC and its, by definition, information-seeking nature, our responses are generally principles-based, and our recommendations are focused on what we believe are the core considerations the Commissions should weigh in their rulemaking, including the considerations that should be taken into account when determining the appropriate regulatory framework for both innovative and established products. The Associations and their members look forward to continuing to provide feedback on more specific matters and generally supporting the Commissions in their ongoing efforts. While this letter is not directed at each individual question raised in the Joint RFC, we have sought to identify the questions from the Joint RFC that are pertinent to the relevant discussion in this letter.
Executive Summary
At the outset, the Associations wish to emphasize that, with respect to established products, market practice is generally well settled and want to caution the Commissions that disrupting such market practice would have significant adverse effects on the market, and could jeopardize market integrity and certainty and cause market participants to incur significant cost and expense for de minimis gain. In many instances the Commissions have already provided extensive guidance about product classification and regulatory obligations, which the market has applied to the established products they transact in. Certain classification determinations are fact-specific and market participants have developed robust processes to analyze and characterize such products and comply with the applicable regulatory regime. As such, for established products, there are limited and narrow issues where additional guidance would resolve genuine ambiguity in the application of the law, which we have outlined below. In general, however, the Associations submit that the Commissions would best serve their objectives of promoting market integrity by maintaining the status quo.
However, in relation to more innovative products, market practice around how products are currently brought to market, their regulatory classification, and what regulatory obligations
apply is continuing to evolve, and the Commissions’ attention and further review is warranted. As part of that review, the Associations respectfully request that the Commissions ensure that any rulemaking or guidance does not inadvertently disrupt existing market practice or modify guidance in relation to more established products. 4
- See Association Annex attached hereto.
- Joint Request for Comment on Further Definition of “Swap” and “Security-Based Swap” and on Alternative Compliance, 91 Fed. Reg. 37873 (June 24, 2026).
- Joint RFC at 37874.
- Further, as multiple new products, trading models, and market‑access pathways emerge, we encourage the Commissions to evaluate these developments in a coordinated and forward‑looking manner. Many new offerings cross regulatory perimeters and rely on fundamentally different market architectures. This introduces practical questions around liquidity provisioning, margin treatment, leverage limits, and participant readiness across the ecosystem. While supporting innovation, the Commissions should also seek to ensure that new offerings do not negatively impact core markets and maintain investor protections. The Associations note the remarks of Chairman Selig at the Innovation Advisory Committee Conference on August 20, 2026, where he previewed forthcoming proposed amendments to Parts 38 and 40 that would, among other things, establish clear expectations for product governance and consumer protection requirements—developments that further highlight the need for careful consideration of how characterization decisions interact with the broader regulatory framework applicable to these products. CFTC, “Remarks at Innovation Advisory Committee Conference” (Aug. 20, 2026), available at https://www.cftc.gov/PressRoom/SpeechesTestimony/opaselig10.