The Securities and Exchange Commission, along with several other federal agencies, issued final rules to the Volcker rule Tuesday.
Financial firms, including hedge funds, have until July 21, 2015 to comply with the new rules. The implementation, which helps move forward a key provision of the Dodd-Frank reform since its enactment three years ago, prohibits depositories from engaging in short-term proprietary trading for their own account.
The final rules also impose limits on the types of investment banks have with hedge funds and private equity funds; in order to pursue a hedge, banks would need to provide detailed information for review by on-site bank supervisors.
Several banking giants, including Goldman Sachs and JPMorgan Chase, have eliminated their proprietary trading units in the last year in response to the Volcker Rule.