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Pursuant to Section 712 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), the Commodity Futures Trading Commission and the Securities and Exchange Commission (collectively, the “Commissions”), in consultation with the Board of Governors of the Federal Reserve System, have issued critical, final rules defining the terms “major swap participant” and “major security-based swap participant” (collectively, “major participants”).   These new regulations establish a comprehensive testing methodology that swap and security-based swap counterparties must employ both to determine whether they will be subject to heightened regulation as a major participant and to establish whether they will be shielded from such requirements by a safe harbor.  To the extent that an entity satisfies any of the three alternative major participant tests, it will generally become subject to additional statutory and regulatory requirements, encompassing margin, capital, business conduct, recordkeeping, and reporting.  Because the CFTC rule and the SEC rule (collectively, the “final rules”) are substantially similar in both substance and approach, this memo discusses the two rules concurrently, highlighting areas in which they differ.