124 STAT. 1680 PUBLIC LAW 111–203—JULY 21, 2010 ‘‘(ii) 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. ‘‘(iii) LIMITATION.—Such definition shall not include an entity whose primary business is providing financing, and uses derivatives for the purpose of hedging underlying commercial risks related to interest rate and foreign currency exposures, 90 percent or more of which arise from financing that facilitates the purchase or lease of products, 90 percent or more of which are manufactured by the parent company or another subsidiary of the parent company. ‘‘(D) TREATMENT OF AFFILIATES.— ‘‘(i) IN GENERAL.—An affiliate of a person that qualifies for an exception under subparagraph (A) (including affiliate entities predominantly engaged in providing financing for the purchase of the merchan- dise 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 swap to hedge or mitigate the commercial risk of the person or other affiliate of the person that is not a financial entity. ‘‘(ii) PROHIBITION RELATING TO CERTAIN AFFILI- ATES.—The exception in clause (i) 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 company, as defined in section 3 of the Investment Company 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. ‘‘(iii) TRANSITION RULE FOR AFFILIATES.—An affil- iate, subsidiary, or a wholly owned entity of a person that qualifies for an exception under subparagraph (A) and is predominantly engaged in providing financing for the purchase or lease of merchandise or manufactured goods of the person shall be exempt from the margin requirement described in section 4s(e) and the clearing requirement described in paragraph (1) with regard to 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 clause. ‘‘(E) ELECTION OF COUNTERPARTY.— Exemption. Time period.
