On December 8, the Commodity Futures Trading Commission (CFTC) approved a final rule amending Part 37 of the CFTC Regulations addressing operational issues facing swap execution facilities (SEF) and their market participants in connection with the CFTC’s regulatory requirements for a SEF’s audit trail data, financial resources, and chief compliance officer (CCO). Specifically, the Final Rule (1) eliminates the requirement for a SEF to capture and retain post-execution allocation information in its audit trail data, (2) applies the existing Core Principle 13 financial resources requirements to SEF operations in a less burdensome manner, and (3) streamlines requirements for the CCO position and allows SEF management to exercise greater discretion in CCO oversight.
Continue Reading CFTC Unanimously Approves Final Rules Related to SEFs and Withdraws Comprehensive Proposals

On December 8, the Commodity Futures Trading Commission (CFTC) unanimously approved two final rules related to margin requirements for uncleared swaps for swap dealers (SD) and major swap participants (MSP).
Continue Reading CFTC Unanimously Approves Final Rules Related to Margin Requirements for Uncleared Swaps for Swap Dealers and Major Swap Participants

On December 8, the National Futures Association (NFA) issued Notice I-20-45 to remind member firms that the compliance date for NFA’s Swaps Proficiency Requirements (Requirements) is January 31, 2021 (Compliance Date). As more fully discussed in the July 10, 2020 edition of the Corporate & Financial Weekly Digest,
Continue Reading NFA Issues Notice to Members Regarding Compliance Date Swaps Proficiency Requirements

On November 23, the Commodity Futures Trading Commission (CFTC) published an interim report regarding the circumstances leading up to the negative settlement price on April 20 of the West Texas Intermediate Light Sweet Crude Oil futures contract (WTI Contract) traded on the New York Mercantile Exchange.
Continue Reading CFTC Staff Publishes Interim Report on NYMEX WTI Crude Contract

On November 13, the Commodity Futures Trading Commission’s Division of Market Oversight (DMO) issued CFTC Staff Letter No. 20-35, which extends temporary no-action relief to swap execution facilities (SEFs) and other market participants originally provided by CFTC Staff Letter No. 17-60. (For additional information regarding CFTC Staff Letter No. 17-60, please refer to the November 17, 2017 edition of Corporate & Financial Weekly Digest.) Staff Letter No. 17-60 provided that DMO would not recommend enforcement action against a SEF that has rules and/or procedures that use the SEF’s non-order book trading systems or platforms to facilitate the execution of block trades for swaps that are intended-to-be-cleared, and thus are not compliant with CFTC Regulation 43.2, subject to certain conditions being met.
Continue Reading CFTC Extends Relief for SEFs From Certain Block Trade Requirements

On November 18, the Commodity Futures Trading Commission (CFTC) unanimously approved a final rule (Final Rule) amending CFTC regulations relating to the execution of “package transactions” on swap execution facilities (SEFs) and the resolution of error trades on SEFs.
Continue Reading CFTC Unanimously Approves Final Rule Amending SEF Requirements

On October 20, the Commodity Futures Trading Commission and the Bank of England (BoE) announced that they had signed an updated Memorandum of Understanding (MOU) regarding the cooperation and exchange of information to preserve the benefits of cross-border clearing activity. The MOU emphasizes the importance of supervision of central counterparties (CCPs) and clarifies that the

On October 6, the Commodity Futures Trading Commission (CFTC) announced a Memorandum of Understanding (MOU) with the Office of Financial Research (OFR) that permits the CFTC to share with OFR information and data reported on Form CPO-PQR. OFR intends to use this data to carry out its statutory responsibilities and functions, which include conducting financial stability-related research and collecting data on behalf of the Financial Stability Oversight Council.
Continue Reading CFTC and the Office of Financial Research Sign Memorandum of Understanding to Allow Information Sharing