(a)
Authority and purpose. Regulation T (this part)
* is issued
by the Board of Governors of the Federal Reserve System (the Board)
pursuant to the Securities Exchange Act of 1934 (the act) (15 USC
78a et seq.). Its principal purpose is to regulate extensions of credit
by brokers and dealers; it also covers related transactions within
the Board’s authority under the act. It imposes, among other obligations,
initial margin requirements and payment rules on certain securities
transactions.
(b) Scope.
(1) This part provides a margin
account and four special-purpose accounts in which to record all financial
relations between a customer and a creditor. Any transaction not specifically
permitted in a special-purpose account shall be recorded in a margin
account.
(2) This part
does not preclude any exchange, national securities association, or
creditor from imposing additional requirements or taking action for
its own protection.
(3) This part does not apply to—
(i) financial relations
between a customer and a creditor to the extent that they comply with
a portfolio margining system under rules approved or amended by the
SEC;
(ii) credit
extended by a creditor based on a good faith determination that the
borrower is an exempted borrower;
(iii) financial relations between a
customer and a broker or dealer registered only under section 15C
of the act; and
(iv) financial relations between a foreign branch of a creditor and
a foreign person involving foreign securities.
