15 U.S.C. § 78j–2 — Position limits and position accountability for security-based swaps and large trader reporting

(a) Position limits — To help prevent fraud and manipulation, the SEC must set limits (including exemptions for hedging) on how big a position in a security-based swap someone can hold, using rules necessary or appropriate to protect the public or investors. In setting these limits, the SEC can require someone to combine (aggregate) their positions in: (1) a security-based swap and the security, loan, or group of securities or loans it's based on, references, or relates to, plus any other related instrument; or (2) a security-based swap and (A) a security or group or index of securities whose price, yield, value, or volatility is a key term of the swap, and (B) any other instrument tied to that same security or group. (b) Exemptions — The SEC can exempt, conditionally or unconditionally, any person, class of persons, swap, class of swaps, or transaction from any position-limit requirement it sets under this section. (c) SRO rules — (1) To help prevent fraud or manipulation, the SEC can direct a self-regulatory organization (SRO) to: (A) adopt rules on position size in security-based swaps held by its members, or by people for whom a member trades such swaps; and (B) adopt rules ensuring compliance with what the SEC requires under this subsection. (2) In setting these limits, the SRO can require combining positions in: (A) a swap and the security, loan, or narrow-based index it's tied to, plus related instruments; or (B) a swap and any other instrument tied to the same security or narrow-based index. (d) Large trader reporting — The SEC can require anyone who trades security-based swaps or uncleared security-based swaps — for themselves or others — along with related securities, loans, or indexes described in subsection (a), to report whatever information the SEC specifies about their positions in those swaps and related instruments.