On October 13, the Division of Market Oversight (DMO) of the Commodity Futures Trading Commission issued two no-action letters that provide limited relief from swap transaction and pricing data reporting requirements for specific derivatives clearing organizations (DCOs) and market participants that take part in upcoming DCO auctions intended to assist in transitioning certain cleared swaps away from discounting using the Effective Federal Funds Rate and instead using the Secured Overnight Financing Rate (such auctions, Transition Auctions). This transition in discounting methods is an important step in the broader initiative to transition swaps that reference interbank offered rates, like the London Interbank Offered Rate (LIBOR), to swaps that reference alternative benchmark rates. In effect, the relief delays reporting requirements, until November 19, for swap transaction and pricing data under CFTC Regulation 43.3 with respect to swaps executed as part of either (1) LCH Limited’s Transition Auction on October 16; or (2) CME Inc.’s Transition Auction on October 19.

The CFTC press release, which includes links to both no-action letters, is available here.