Corporate & Financial Weekly Digest

Corporate & Financial Weekly Digest

Category Archives: CFTC

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SEC Cautions Securities Laws May Apply to Interests in Virtual Organizations

Posted in Broker-Dealer, CFTC
On July 25, the Securities and Exchange Commission issued a Report of Investigation cautioning that certain offers and sales of digital assets of virtual organizations (e.g., “coin offerings” or “token sales”) could be deemed securities offerings and therefore subject to the federal securities laws. More details relating to the Report of Investigation are available in… Continue Reading

CFTC Grants DCO Registration to LedgerX

Posted in CFTC, Derivatives
The Commodity Futures Trading Commission has issued an order granting LedgerX LLC registration as a derivatives clearing organization (DCO). As specified in the order, LedgerX is permitted to clear fully collateralized digital currency swaps. A transaction will be fully collateralized if LedgerX holds, at all times, funds in the form of the required payment sufficient… Continue Reading

CFTC Extends Relief From Transaction-Level Requirements for Non-US Swap Dealers

Posted in CFTC, Derivatives
The Division of Swap Dealer and Intermediary Oversight, the Division of Clearing and Risk and the Division of Market Oversight (collectively, the Divisions) of the Commodity Futures Trading Commission have extended relief previously provided in a series of previous no-action letters relating to transaction-level requirements for non-US swap dealers (non-US SDs). Specifically, the Divisions have… Continue Reading

NFA Adopts Interpretive Notice on Swap Valuation Disputes

Posted in CFTC, Derivatives
National Futures Association (NFA) has adopted an interpretive notice that standardizes the process for filing swap valuation disputes with NFA. As set forth in the interpretive notice, swap dealers (SDs) generally are required to file with NFA notices of unresolved swap valuation disputes involving initial margin, variation margin and/or transaction or portfolio valuations if the… Continue Reading

NFA Adopts 4s Attestation Process for Swap Dealers and Major Swap Participants

Posted in CFTC, Derivatives
National Futures Association (NFA) has revised the process by which each swap dealer (SD) and major swap participant (MSP) applicant demonstrates its ability to comply with Commodity Futures Trading Commission regulations implementing Section 4s of the Commodity Exchange Act (4s Regulations), including but not limited to regulations relating to capital and margin requirements, reporting and… Continue Reading

CFTC Announces Review of Swaps Reporting Regulations

Posted in CFTC
On July 10, the Commodity Futures Trading Commission’s Division of Market Oversight (Division) issued Staff Letter 17-33 (Staff Letter), which announced the launch of a comprehensive review of swap data reporting requirements. The review will focus on existing regulations with the goal of (1) ensuring the CFTC receives accurate, complete and high-quality data regarding swap… Continue Reading

CFTC Issues Conditional No-Action Relief From Swap Data Repository Reporting

Posted in CFTC
On June 30, the Commodity Futures Trading Commission’s Division of Market Oversight and Division of Clearing and Risk (Divisions) provided conditional no-action relief to Cantor Futures Exchange, L.P. (CX), Cantor Clearinghouse, L.P. (CC) and the North American Derivatives Exchange, Inc. (Nadex) from reporting certain information to a swap data repository (SDR), subject to certain conditions.… Continue Reading

NFA Publishes Information For CTAs Using Third-Party Recordkeeping

Posted in CFTC
On June 30, the National Futures Association (NFA) published Notice to Members I-17-11, establishing an electronic process for a registered commodity trading advisor (CTA) to notify the NFA where the CTA uses a third-party recordkeeper. This notice is effected through the NFA’s electronic Exemptions System by claiming a “4.7(c)(2)” or “4.33” exemption, as applicable, and… Continue Reading

CFTC Grants SEF Registration to LedgerX

Posted in CFTC
The Commodity Futures Trading Commission has issued an order of registration as a swap execution facility (SEF) to LedgerX LLC. As an SEF, LedgerX intends to list options on Bitcoin and other swaps based on digital currencies. As noted in the order, LedgerX additionally has applied for registration as a derivatives clearing organization. More information… Continue Reading

Market Risk Advisory Committee to Host Public Meeting

Posted in CFTC
On June 20, the Commodity Futures Trading Commission Market Risk Advisory Committee will hold a meeting at the CFTC’s headquarters in Washington, DC. CFTC Commissioner Sharon Bowen is the committee’s sponsor. Items on the meeting agenda include: (1) a presentation by the CFTC’s Division of Clearing and Risk on how it conducts risk surveillance of… Continue Reading

CFTC Issues Order of Registration Permitting Eurex Zurich AG to Engage in Direct Access Trading From the United States

Posted in CFTC
On May 30, the Commodity Futures Trading Commission (CFTC) issued an Order of Registration (Order) permitting Eurex Zurich AG (Eurex Zurich), a foreign derivatives exchange authorized by and subject to regulation by Switzerland’s Financial Market Supervisory Authority (FINMA), to provide identified members and other US-based participants with direct access to its electronic order entry and… Continue Reading

CFTC Extends No-Action Relief to SEFs and DCMs From Certain Error Correction Regulations

Posted in CFTC
On May 30, the Commodity Futures Trading Commission’s (CFTC) Division of Market Oversight and Division of Clearing and Risk (Divisions) issued Staff Letter 17-27, extending previously granted no-action relief to swap execution facilities (SEFs) and designated contract markets (DCMs) from restrictions on using pre-arranged trades to correct clerical or operational errors that (1) caused a… Continue Reading

NFA Issues Notice Regarding Monthly Risk Data Reporting Requirements for Swap Dealers

Posted in CFTC
On May 30, the National Futures Association (NFA) issued Interpretive Notice I-17-1 (Notice), which sets forth the specific list of risk metrics that swap dealers (SDs) will be required to electronically report to NFA on a monthly basis, beginning with the initial January 31, 2018, reporting deadline. NFA intends to use this information to assess… Continue Reading

CFTC Approves Amendments to Recordkeeping Requirements

Posted in CFTC
On May 23, the Commodity Futures Trading Commission approved amendments to Regulation 1.31, which contains the recordkeeping requirements under the Commodity Exchange Act and CFTC regulations. The final rule adopts the amendments as proposed with a few exceptions. The proposed amendments are discussed in the January 13 edition of the Corporate & Financial Weekly Digest.… Continue Reading

CFTC Launches LabCFTC as Major FinTech Initiative

Posted in CFTC
On May 17, the Commodity Futures Trading Commission announced the creation of LabCFTC, a new initiative aimed at promoting responsible FinTech innovation to improve the quality, resiliency, and competitiveness of the markets the CFTC oversees. The core components of LabCFTC are: (1) GuidePoint, which will serve as a dedicated point of contact for FinTech innovators… Continue Reading

CFTC Issues Guidance on the Calculation of Projected Operating Costs by DCMs and SEFs

Posted in CFTC
On April 28, the Commodity Futures Trading Commission issued guidance on the calculation by designated contract markets (DCMs) and swap execution facilities (SEFs) of projected operating costs for purposes of complying with DCM Core Principle 21 and CFTC Regulation 38.1101(c), and SEF Core Principle 13 and CFTC Regulation 37.1303.… Continue Reading

CFTC Proposes Amendments to Certain Rules Governing CCO Duties and Annual Reports

Posted in CFTC
On May 3, the Commodity Futures Trading Commission announced proposed rules amending its regulations regarding certain duties of chief compliance officers (CCOs) of swap dealers (SDs), major swap participants (MSPs) and futures commission merchants (FCMs; each, a Registrant). In addition, the proposed rules amend certain requirements for preparing and furnishing CCO annual reports on a… Continue Reading

CFTC Requests Public Input on Simplifying Rules

Posted in CFTC
On May 3, the Commodity Futures Trading Commission voted to seek comment from interested parties on applying CFTC’s regulations in simpler and less burdensome ways. The request for comment relates to the CFTC’s Project KISS, which stands for “Keep It Simple, Stupid.” In announcing the project, CFTC Acting Chairman J. Christopher Giancarlo noted that the… Continue Reading

CFTC Extends Relief to CTAs With Third-Party Recordkeepers

Posted in CFTC, Derivatives
The Commodity Futures Trading Commission’s Division of Swap Dealer and Intermediary Oversight (DSIO) has issued exemptive relief to commodity trading advisors (CTAs) from the requirement to keep records under CFTC Regulations 4.7(c)(2) and 4.33 at the CTA’s main business office. As provided in the exemptive letter, a CTA may use a third-party recordkeeper so long… Continue Reading