Page:United States Statutes at Large Volume 124.djvu/1792

124 STAT. 1766 PUBLIC LAW 111–203—JULY 21, 2010 nature, as defined in section 4(k) of the Bank Holding Company Act of 1956. ‘‘(B) EXCLUSION.—The Commission shall consider whether to exempt small banks, savings associations, farm credit system institutions, and credit unions, including— ‘‘(i) depository institutions with total assets of $10,000,000,000 or less; ‘‘(ii) farm credit system institutions with total assets of $10,000,000,000 or less; or ‘‘(iii) credit unions with total assets of $10,000,000,000 or less. ‘‘(4) TREATMENT OF AFFILIATES.— ‘‘(A) IN GENERAL.—An affiliate of a person that qualifies for an exception under this subsection (including affiliate entities predominantly engaged in providing financing for the purchase of the merchandise or manufactured goods of the person) may qualify for the exception only if the affiliate, acting on behalf of the person and as an agent, uses the security-based swap to hedge or mitigate the commercial risk of the person or other affiliate of the person that is not a financial entity. ‘‘(B) PROHIBITION RELATING TO CERTAIN AFFILIATES.— The exception in subparagraph (A) shall not apply if the affiliate is— ‘‘(i) a swap dealer; ‘‘(ii) a security-based swap dealer; ‘‘(iii) a major swap participant; ‘‘(iv) a major security-based swap participant; ‘‘(v) an issuer that would be an investment com- pany, as defined in section 3 of the Investment Com- pany Act of 1940 (15 U.S.C. 80a–3), but for paragraph (1) or (7) of subsection (c) of that Act (15 U.S.C. 80a– 3(c)); ‘‘(vi) a commodity pool; or ‘‘(vii) a bank holding company with over $50,000,000,000 in consolidated assets. ‘‘(C) TRANSITION RULE FOR AFFILIATES.—An affiliate, subsidiary, or a wholly owned entity of a person that quali- fies for an exception under subparagraph (A) and is predominantly engaged in providing financing for the pur- chase or lease of merchandise or manufactured goods of the person shall be exempt from the margin requirement described in section 15F(e) and the clearing requirement described in subsection (a) with regard to security-based swaps entered into to mitigate the risk of the financing activities for not less than a 2-year period beginning on the date of enactment of this subparagraph. ‘‘(5) ELECTION OF COUNTERPARTY.— ‘‘(A) SECURITY-BASED SWAPS REQUIRED TO BE CLEARED.—With respect to any security-based swap that is subject to the mandatory clearing requirement under subsection (a) and entered into by a security-based swap dealer or a major security-based swap participant with a counterparty that is not a swap dealer, major swap participant, security-based swap dealer, or major security- based swap participant, the counterparty shall have the