SEC Commissioner Uyeda to Drive Treasuries Settlement Initiatives underthe agency's purview
The Securities and Exchange Commission (SEC) has issued Frequently Asked Questions (FAQs) to help broker-dealers navigate rule amendments related to the clearing of U.S. Treasury securities, as the transition to central clearing approaches. The compliance dates for cash and repo clearing of U.S. Treasury securities are set for December 31, 2026, and June 30, 2027, respectively.
Commissioner Mark T. Uyeda will lead the SEC's efforts related to the transition, coordinating the ongoing work being done across the agency to prepare for the shift. Uyeda emphasised the central importance of the U.S. Treasury market to the country and the world, and the SEC's policies aim to enhance the Treasury market's functioning.
The FAQs address a range of topics, including the application of customer reserve formulas, margin treatment, and the handling of cleared Treasury securities under amended customer protection rules. They provide guidance on how customer reserve requirements should be applied for cleared U.S. Treasury securities, prefunding of customer margin requirements, the use of customers’ securities to meet margin requirements, mark-to-market or variation margin payments, and scenarios where customers may borrow against other customer collateral to meet margin requirements imposed by qualified clearing agencies.
The FAQs also confirm that the SEC has approved the Fixed Income Clearing Corporation (FICC) rule changes addressing relevant financial responsibility rules, and that broker-dealers may include a debit in customer reserve computations when depositing cash, U.S. Treasury securities, or qualified customer securities to meet margin requirements at FICC.
Paul S. Atkins, Chairman of the SEC, stated that it is critical that the transition to clearing U.S. Treasury securities goes smoothly. Atkins is looking forward to engaging with stakeholders, as previously mentioned. The staff of the SEC is making progress on providing clarification for areas where the industry has raised concerns about the transition effort.
The SEC is committed to engaging with market participants, central banks, and fellow regulators, as stated by Commissioner Uyeda. The Division of Trading and Markets, led by Director Jamie Selway, is committed to assisting broker-dealers and other market participants in the transition to central clearing in the U.S. Treasury market. Commissioner Uyeda and Chairman Atkins look forward to engaging with stakeholders to ensure a successful transition to clearing U.S. Treasury securities.
These FAQs serve as authoritative guidance to broker-dealers for applying the amended clearing rules, customer reserve formula requirements, margin treatment, and related operational details under SEC Rule 15c3-3a and approved FICC rules for U.S. Treasury securities. The FAQs were published in August 2025, shortly after the SEC finalized rule implementation deadlines for Treasury cash and repurchase transactions by late 2026 and 2027, respectively, with an extension allowed for compliance purposes.
The SEC's FAQs offer guidance on the application of amended clearing rules and operational details under Rule 15c3-3a, specifically for the finance industry, as they navigate the transition to central clearing of U.S. Treasury securities by broker-dealers. The SEC is committed to working closely with market participants, industry regulators, and central banks to ensure the smooth implementation of these amended regulations in the business sector.
