On March 24, the Commodity Futures Trading Commission’s Division of Market Oversight extended no-action relief relating to the recordkeeping and confirmation requirements in CFTC Regulations 37.6(b), 37.1000, 37.1001, 45.2, and 45.3(a). This relief applies only to uncleared swap transactions executed on or pursuant to the rules of a Swap Execution Facility (SEF) and is subject to several conditions.
Under the no-action letter, a SEF is permitted to incorporate by reference terms from previously negotiated agreements between counterparties, even if the SEF has not received copies of such agreements. Further, SEFs are relieved from the requirement to maintain a copy of the agreements incorporated by reference in a SEF’s confirmation, as required under CFTC regulations. However, a SEF must continue to report all swap data that the SEF is currently reporting, even if the data appears in the documents the SEF confirmations incorporate by reference.
The relief extends until the effective date of any amendments to CFTC regulations establishing a permanent SEF confirmation solution for uncleared swap transactions.
CFTC Letter 17-17 is available here.