Section 252.88 - Exclusion of certain QFCs(a)Exclusion of QFCs with FMUs. Notwithstanding § 252.82 , a covered entity is not required to conform to the requirements of this subpart a covered QFC to which: (2) Each party (other than the covered entity) is an FMU.(b)Exclusion of certain excluded bank QFCs. If a covered QFC is also a covered QFC under parts 47 or 382 of this title that an affiliate of the covered entity is also required to conform pursuant to parts 47 or 382 of this title and the covered entity is: (1) The affiliate credit enhancement provider with respect to the covered QFC, then the covered entity is required to conform the credit enhancement to the requirements of this subpart but is not required to conform the direct QFC to the requirements of this subpart; or(2) The direct party to which the excluded bank is the affiliate credit enhancement provider, then the covered entity is required to conform the direct QFC to the requirements of this subpart but is not required to conform the credit enhancement to the requirements of this subpart.(c)Exclusion of certain contracts. Notwithstanding § 252.82 , a covered entity is not required to conform the following types of contracts or agreements to the requirements of this subpart: (1) An investment advisory contract that: (i) Is with a retail customer or counterparty;(ii) Does not explicitly restrict the transfer of the contract (or any QFC entered pursuant thereto or governed thereby, or any interest or obligation in or under, or any property securing, any such QFC or the contract) from the covered entity except as necessary to comply with section 205(a)(2) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-5(a)(2) ) ; and(iii) Does not explicitly provide a default right with respect to the contract or any QFC entered pursuant thereto or governed thereby.(2) A warrant that:(i) Evidences a right to subscribe to or otherwise acquire a security of the covered entity or an affiliate of the covered entity; and(ii) Was issued prior to November 13, 2017.(d)Exemption by order. The Board may exempt by order one or more covered entities from conforming one or more contracts or types of contracts to one or more of the requirements of this subpart after considering: (1) The potential impact of the exemption on the ability of the covered entity(ies), or affiliates of the covered entity(ies), to be resolved in a rapid and orderly manner in the event of the financial distress or failure of the entity that is required to submit a resolution plan;(2) The burden the exemption would relieve; and(3) Any other factor the Board deems relevant.