The Dodd-Frank Act's Pushout Rule: Implications for the Derivatives Market | White & Case LLP International Law Firm, Global Law Practice
The Dodd-Frank Act's Pushout Rule: Implications for the Derivatives Market

The Dodd-Frank Act's Pushout Rule: Implications for the Derivatives Market

Section 716 of the Dodd-Frank Act is designed to curb excessive systemic risk. It bars "federal assistance" to "swaps entities."

But Section 716 does enable entities subject to the Pushout Rule to remain eligible for federal assistance if they push certain derivatives activities out to separately capitalized affiliates.

As Ian Cuillerier, a structured-finance and derivatives partner in the New York office of White & Case explains, "Although Section 716 is referred to as the Pushout Rule, it is primarily a ban on federal assistance to certain institutions. The push-out element is therefore the direct consequence of the prohibition."