William Stern (pictured), New York based Partner in Goodwin Procter LLP’s Financial Institutions Group, comments on the publication of the new Volcker rule…  

With respect to the covered funds aspect of the Volcker rule, the final implementing regulation includes a number of revisions that should alleviate many of the concerns raised by the banking industry, including a provision that limits the impact of the rule on certain funds that only use derivatives to a limited extent. 

There is also good news for certain funds sponsored and managed by non-US banking organisations outside of the United States in that many of these funds will no longer be treated as covered funds as originally proposed. 

However, there are a number of questions remaining – for example, the manner in which the rule might apply to non-US funds of funds is something that we are looking at closely – and it will take some time to sort out precisely how the regulators will apply the rule in practice.”