§ 23.432 Clearing disclosures.

(a) For swaps required to be cleared—right to select derivatives clearing organization. A swap entity shall notify any counterparty (other than a swap entity, securities-based swap dealer, or major securities-based swap participant) prior to entering into a swap that is subject to mandatory clearing under section 2(h) of the Act, that the counterparty has the sole right to select the derivatives clearing organization at which the swap will be cleared. (b) For swaps not required to be cleared—right to clearing. A swap entity shall notify any counterparty (other than a swap entity, securities-based swap dealer, or major securities-based swap participant) prior to entering into a swap that is not subject to the mandatory clearing requirements under section 2(h) of the Act that the counterparty: (1) May elect to require clearing of the swap; and (2) Shall have the sole right to select the derivatives clearing organization at which the swap will be cleared. (c) Exceptions. This section shall not apply with respect to a transaction that is: (1) An ITBC Swap that is initiated on a designated contract market, a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act; or (2) An A-ITBC Swap.