The corporate end-user exemption to the Dodd-Frank bill's tough new requirements for trading over-the-counter derivatives has survived a torturous, contentious legislative process. The principle of exempting corporate hedgers from provisions meant to reduce systemic risk caused by dealers and speculators is embedded in the landmark financial reform bill that teeters on the brink of passage. "The exemption is in place," reports Brian Kalish, finance practice lead at the Association for Financial Professionals. "We're comfortable."

While that paper exemption is comforting, it may not protect corporate treasuries from the market fallout as banks, dealers and speculators that are not exempt change their business strategies. "Even if we're exempt," notes Pat Ryder, director of financial risk management at $5 billion Eastman Chemical in Kingsport, Tenn., "we may still get hit with higher costs through the bid-ask spread and maybe have to post margin to the banks through enhanced credit support annexes. Our cost may go up."

"The devil is in the details," observes Jiro Okochi, CEO of Reval, a New York City-based derivative risk management and hedge accounting software firm. "On paper, some things are settled. In practice, we have to wait and see. There will be studies and rule-making, but the intent is to not force nonfinancial corporate end users onto exchanges or into clearing." If players don't like the rules, they will abandon certain markets or derivatives, which will die a quick death, Okochi adds.