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AFP Press Release

AFP Commends CFTC Approval of End-User Clearinghouse Exemption for OTC Derivatives Trading

Streamlines Key Route for Commercial Hedging Against Risk

WASHINGTON – July 11, 2012 - The Association for Financial Professionals (AFP), the professional society representing corporate treasurers, chief financial officers and their staff, issued the following statement on Tuesday’s approval by the Commodity Futures Trading Commission (CFTC) to exempt over-the-counter (OTC) derivatives end-users from clearinghouse requirements, distinguishing their usage for commercial hedging practices.

“Tuesday’s approval protects a necessary pathway for businesses to practice safe and responsible financial risk management,” said Jim Kaitz, AFP's president and CEO.

“The end-user exemption from the clearing mandate recognizes the importance of preserving this risk management tool and sets the right precedent for rulemaking. A similar rationale should be applied to margin requirements for end-users, which would obstruct the utility of OTC derivatives for business risk mitigation.”

Final approval came with a 4-1 vote defining the end-user clearing exemption, as intended by the Dodd-Frank Wall Street Reform and Consumer Protection Act.

AFP has been a leading voice for non-financial businesses, which utilize OTC derivatives to minimize their risk exposures and to follow prudent financial management practices.

For more information, contact Konstantine Kastens in AFP's government relations department at 301.907.2862 or via kkastens@afponline.org.

ABOUT AFP® (afponline.org)
The Association for Financial Professionals (AFP) is a professional society headquartered outside Washington, DC, that provides members with news, economic research and data on the evolving world of treasury and finance, certification programs, networking events, financial analytical tools, training, and public policy representation to legislators and regulators. AFP's global reach extends to over 150,000 treasury and financial professionals worldwide, including AFP of Canada; London-based gtnews, an on-line resource for the treasury and finance community; and bobsguide, a financial IT solutions network.


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