Securities Regulation Daily Wrap Up, CLEARING AND SETTLEMENT—SEC issues Treasury clearing relief for certain repo transactions, (Nov 2, 2026)
The SEC eased Treasury clearing requirements by excluding certain non-U.S and inter-affiliate repo transactions.
The SEC issued exemptive relief from required central clearing of U.S. Treasury securities for certain non-U.S and inter-affiliate repo transactions. The order excludes specified transactions from the definition of eligible secondary market transactions, subject to conditions (Order Granting Exemptive Relief, Pursuant to Sections 17A and 36(a) of the Securities Exchange Act of 1934, from the Definition of an “Eligible Secondary Market Transaction” in Rule 17ad-22(a), Release No. 34-106789 (Oct. 30, 2026)).
Commissioner Mark Uyeda said the Commission had “listened carefully to market participants” about challenges of implementing 2023 Treasury clearing rules.
“Today’s targeted relief addresses practical concerns while preserving the important benefits of central clearing,” said Uyeda.
Treasury clearing requirements. The SEC adopted rule amendments on December 13, 2023, that required covered clearing agencies in the U.S. Treasury market to adopt policies and procedures designed to require their members to submit for clearing certain specified secondary market transactions.
According to then-SEC Chair Gary Gensler, the clearing requirements addressed system-wide risk arising from a significant portion of the Treasury markets being uncleared—70 to 80 percent of the Treasury funding market and at least 80 percent of the cash markets.
In February 2025, the SEC extended compliance dates and said it stood ready to engage with market participants on implementation issues.
Non-U.S. counterparties. The October 30 order excludes certain non-U.S. repurchase transactions from the definition of eligible secondary market transactions.
The exemption excludes a certain amount of a firm’s qualifying non-U.S. transactions, as defined, from the definition of eligible secondary market transactions, provided that either a percentage cap or maximum dollar amount is met.
Inter-affiliate repo transactions. The order also excludes certain repo transactions between a direct participant of a U.S. Treasury securities clearing agency and any affiliated entity that is not an “investment company” as defined in Section 3 of the Investment Company Act of 1940, provided that affiliate otherwise meets the definition of an affiliated counterparty in Rule 17ad-22(a).
The SEC said that market participants can contact SEC staff in the Division of Trading and Markets directly with questions.
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