On December 11 2009, the US House of Representatives passed the Derivatives Markets Transparency and Accountability Act (DMA) as part of the Wall Street Reform and Consumer Protection Act (RCPA). The DMA is a modified form of legislation drafted by the Obama Administration earlier in 2009, which was the first comprehensive legislative effort to increase regulation of over-the-counter (OTC) derivatives and bring them under federal supervision in light of the financial crisis.
Now, during the first quarter of 2010, attention will shift to the US Senate, where Senate Banking Committee Chairman Christopher Dodd's discussion draft on financial regulatory reform, released on November 10 2009, remains outstanding. Title VII of the Dodd bill focuses on regulation of OTC derivatives. It came under substantial scrutiny almost immediately following its release, particularly with respect to Dodd's proposal to create a single federal bank regulatory agency that would replace three existing agencies and take...