With regulatory reform already finalized, Senate leaders sent a letter to their House counterparts this week attempting to clarify the intent of a derivatives provision without reopening the legislation.

The House approved the bill Wednesday and the Senate is expected to take up the legislation when it returns from a week-long Fourth of July recess.

The letter says the legislation is intended to continue to allow end-users to use derivatives to hedge risks. It specifically emphasizes that the measure does not authorize regulators to impose margin, capital or clearing requirements on commercial end-users of derivatives.

"Whether swaps are used by an airline hedging its fuel costs or a global manufacturing company hedging interest rate risk, derivatives are an important tool businesses use to manage costs and market volatility. This legislation will preserve that tool," wrote Senate Banking Committee Chairman Chris Dodd and Senate Agriculture Committee Chairman Blanche Lincoln in a letter dated Wednesday to House Financial Services Committee Chairman Barney Frank and House Agriculture Committee Chairman Collin Peterson.

"Regulators must carefully follow congressional intent in implementing this bill," they said.

The four-page letter addresses an issue raised by Sen. Saxby Chambliss earlier this week, who argued the legislation could be read to stop end-users from hedging risk.

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