SEC Publishes Notice of German Substituted Compliance Application and Proposed Order

The Securities and Exchange Commission today voted to publish a notice of a substituted compliance application by Germany’s Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin) as well as a proposed order that would conditionally provide substituted compliance for German firms that are registered with the Commission as security-based swap dealers and security-based swap participants. These are the latest of a series of actions that the Commission has taken to stand up Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act, including cross-border regulation. Substituted compliance is an alternative method by which the Commission can allow non-U.S. dealers and major participants to satisfy certain requirements under the Securities Exchange Act of 1934 by complying with comparable foreign requirements. The Commission retains the authority to inspect, examine and supervise non-U.S.