ISDA submitted a comment letter to the U.S. Securities and Exchange Commission (SEC) in response to the CME Securities Clearing, Inc.(CMESC)  application for registration as a clearing agency to clear US Treasury Transactions.

ISDA encourages the SEC to facilitate clearing of U.S. Treasuries at additional clearing agencies in light of the SEC’s clearing mandate. Subject to CMESC making the amendments and clarifications discussed in the comment letter with respect to its clearing model, ISDA strongly supports CMESC’s application to register as a clearing agency. The proposed framework for clearing in the CMESC application would create a competitive U.S. Treasury clearing landscape that, in turn, would provide for a more resilient U.S. Treasury market.

Among others things, ISDA’s comments recommend that CMESC amend and clarify certain rules and procedures to ensure favorable regulatory capital treatment for prudentially regulated market participants that clear for other market participants.