Solely for purposes of this subpart, the terms listed in this section have the meanings set forth below.

(a) A-ITBC Swap. The term “Anonymous ITBC Swap” or “A-ITBC Swap” means an ITBC Swap (as defined in paragraph (d) of this section) where the swap entity does not know the identity of the counterparty prior to execution of the swap. An A-ITBC Swap may be executed bilaterally between the parties or may be executed on or pursuant to the rules of a designated contract market, swap execution facility, or a trading facility exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act.

(b) Counterparty. The term “counterparty,” as appropriate in this subpart, includes any person who is a prospective party to a swap.

(c) Covered Transaction. The term “Covered Transaction” means a swap, as defined in section 1a(47) of the Act and § 1.3 of this chapter (other than swaps subject to the clearing requirement of section 2(h)(1)(A) of the Act and part 50 of this chapter), and physically-settled foreign exchange forwards and swaps that have been exempted from the definition of swap by the U.S. Department of the Treasury.

(d) ITBC Swap. The term “Intended to be Cleared Swap” or “ITBC Swap” means a swap that meets the following conditions, as applicable:

(1) At least one of the parties to the swap is a swap entity;

(2) The swap is of a type accepted for clearing by a derivatives clearing organization registered with the Commission (“DCO”) or a clearing organization that is currently exempted from registration by the Commission pursuant to section 5b(h) of the Act (“Exempt DCO”);

(3) The swap is intended by the parties to be cleared contemporaneously with execution;

(4) If the swap is intended to be cleared on a DCO, the swap entity and its counterparty are either clearing members of the DCO to which the swap will be submitted, or have entered into an agreement with a clearing member of such DCO for clearing of swaps of the same type as the swap intended to be cleared;

(5) If the swap is intended to be cleared on an Exempt DCO, the swap entity and its counterparty must be eligible to clear the swap on the Exempt DCO pursuant to the terms and conditions of the Order of Exemption from Registration issued by the Commission regarding such Exempt DCO;

(6) The swap entity does not require its counterparty or its clearing member (if any) to enter into a breakage agreement or similar agreement as a condition to executing the swap;

(7) If the swap is not executed on or pursuant to the rules of a designated contract market (“DCM”), swap execution facility (“SEF”), or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act (“Exempt SEF”), the swap entity takes reasonable measures to ensure that both parties submit the swap for clearing to a DCO or Exempt DCO as quickly after execution as would be technologically practicable if fully automated systems were used, and either:

(i) The parties have agreed prior to or at execution that if such swap is rejected from clearing, the swap is deemed to be void ab initio, or

(ii) The parties, prior to execution, have entered into a breakage agreement or similar arrangement that addresses the disposition of such rejected swap and includes arrangements that will permit a Swap Entity to comply with the requirements of subparts H and I of this part with respect to the rejected swap;

(8) If the swap is executed on or pursuant to the rules of a DCM, SEF, or Exempt SEF, the rules of the DCM, SEF, or Exempt SEF provide that if the swap is rejected from clearing, such swap is deemed to be void ab initio; provided that if the swap is executed on or pursuant to the rules of an Exempt SEF and the rules of the Exempt SEF do not provide for a swap rejected from clearing to be deemed void ab initio:

(i) The parties have agreed prior to or at execution that if such swap is rejected from clearing, the swap is deemed to be void ab initio, or

(ii) The parties, prior to execution, have entered into a breakage agreement or similar arrangement that addresses the disposition of such rejected swap and includes arrangements that will permit a Swap Entity to comply with the requirements of subparts H and I of this part with respect to the rejected swap.

(e) Major swap participant. The term “major swap participant” means any person defined in section 1a(33) of the Act and § 1.3 of this chapter and, as appropriate in this subpart, any person acting for or on behalf of a major swap participant, including an associated person defined in section 1a(4) of the Act.

(f) Prime Broker Arrangement. The term “Prime Broker Arrangement” means any arrangement sometimes known in the trade as “swap prime brokerage” or “swap credit intermediation” among at least one swap dealer acting as a prime broker (the “Prime Broker”) and two or more other parties evidenced by a written agreement or agreements pursuant to which the Prime Broker, subject to any applicable conditions, is contractually obligated to enter into (whether pursuant to a “give-up” arrangement, novation, or otherwise):

(1) A Covered Transaction (the “Trigger Transaction”) for which the Prime Broker has not determined the material economic terms and price with a counterparty (the “Trigger CP”); and

(2) One or more additional Covered Transactions with one or more other counterparties that are not the Trigger CP, resulting in the Prime Broker being party to equal but offsetting transactions as a credit intermediary; provided that one or more of the Covered Transactions may include a spread or fee to be paid to the Prime Broker and/or an intermediary that has arranged the transactions (or a portion thereof) as compensation for the Prime Broker's credit intermediation services and/or the services of the intermediary.

(g) Qualified Prime Broker Arrangement. The term “Qualified Prime Broker Arrangement” means a Prime Broker Arrangement that meets the following conditions:

(1) The Prime Broker (as defined under the definition of Prime Broker Arrangement) and a counterparty that is not a swap entity that has entered into a Prime Broker Arrangement with the Prime Broker (the “PB Counterparty”) have agreed in writing on the type, parameters, and limits of each potential Covered Transaction that may be entered into by the PB Counterparty with the Prime Broker pursuant to such Prime Broker Arrangement (each, a “Permitted PB Transaction”); and

(2) The PB Counterparty has received from the Prime Broker all disclosures regarding the Permitted PB Transactions that, to the best of the Prime Broker's knowledge and reasonable belief, would be necessary for the Prime Broker to comply with § 23.431(a), other than the pre-trade disclosure of the material economic terms and the price of the Permitted PB Transaction;

(h) Special Entity. The term “Special Entity” means:

(1) A Federal agency;

(2) A State, State agency, city, county, municipality, other political subdivision of a State, or any instrumentality, department, or a corporation of or established by a State or political subdivision of a State;

(3) Any employee benefit plan subject to Title I of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002);

(4) Any governmental plan, as defined in section 3 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002);

(5) Any endowment, including an endowment that is an organization described in section 501(c)(3) of the Internal Revenue Code of 1986 (26 U.S.C. 501(c)(3)); or

(6) Any employee benefit plan defined in section 3 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002), not otherwise defined as a Special Entity, that elects to be a Special Entity by notifying a swap entity of its election prior to entering into a swap with the particular swap entity.

(i) Swap dealer. The term “swap dealer” means any person defined in section 1a(49) of the Act and § 1.3 of this chapter and, as appropriate in this subpart, any person acting for or on behalf of a swap dealer, including an associated person defined in section 1a(4) of the Act.

(j) Swap entity. The term “swap entity” means a swap dealer or major swap participant.