On August 1, 2019, the Commodity Futures Trading Commission’s (CFTC) Division of Market Oversight (DMO) issued a letter extending prior no-action relief, which suspended the need for certain persons otherwise required to aggregate positions to proactively file formal written notice for position limits purposes. The prior relief, CFTC No Action Letter 17-37, was set to expire on August 12, 2019. Continue Reading CFTC’s Division of Market Oversight Extends No-Action Relief from Position Aggregation Requirements

CBOE Exchange, Inc. (CBOE) recently filed a proposal to amend its Rule 6.49A to amend provisions related to permissible off-floor position transfers. Generally, CBOE Rule 6.49A(a) specifies limited circumstances in which CBOE Trading Permit Holders (TPHs) may transfer their positions off the floor. CBOE proposes to add four events where an off-floor transfer would be permitted to occur. Continue Reading CBOE Proposes Amendments to Rule 6.49A Concerning Off-Floor Position Transfers Including RWA Transfers

On July 23, the Basel Committee on Banking Supervision (BCBS) and the International Organization of Securities Commissions (IOSCO) published a revised framework for mandatory initial margin applicable to swaps that are not cleared with a central clearing party. The key revision was the insertion of an additional year into the implementation schedule for the margin rules. Continue Reading Delay of Final Implementation of Swap Initial Margin Rules

The Commodity Futures Trading Commission has published for comment two proposals intended to reduce the regulatory obligations that certain non-US clearing organizations would otherwise be subject. In accordance with section 5b(a) of the Commodity Exchange Act (CEA), it is unlawful for any clearing organization to clear swaps on behalf of US persons unless that clearing organization is registered with the CFTC as a derivatives clearing organization (DCO). However, CEA section 5b(h) authorizes the CFTC to exempt from registration any non-US clearing organization that is “subject to comparable, comprehensive supervision and regulation” by its home country regulator. In the exercise of this latter authority, the CFTC has proposed to permit those non-US clearing organizations that the CFTC determines do not pose a substantial risk to the US financial system to elect either 1) registration as a DCO with alternative compliance obligations; or 2) an exemption from registration altogether. Continue Reading CFTC Proposes Amendments to Reduce Regulatory Obligations on Certain Non-US Clearing Organizations

On July 22, the Commodity Futures Trading Commission announced that it is extending the comment period for the proposal to improve data quality and streamline regulations for swap data reporting until October 28. Continue Reading CFTC Extends Public Comment Period for Proposed Amendment to Swap Data Reporting Regulations

On July 22, the Commodity Futures Trading Commission, in conjunction with the Financial Crimes Enforcement Network (FinCEN), issued interpretative guidance to introducing brokers in commodities (IBs) that do not introduce customers to a futures commission merchant (FCM) that carries their customers’ accounts. Continue Reading CFTC Clarifies That the Customer Identification Program and Beneficial Ownership Rules are Not Applicable to Certain Introduction Brokers

On July 24, the European Commission (EC) published a suite of documents assessing the current anti-money laundering (AML) and counter-terrorist financing (CTF) framework in operation in the European Union (EU).

Although each document is addressed to the European Parliament and the Council of the EU, the EC states that it believes that these documents will support the EU and national authorities to better address money laundering and terrorist financing risks. It notes that some improvements can be made quickly at an operational level, and the EC will continue to support EU member states in this, while also reflecting on how to address the remaining structural challenges. Continue Reading European Commission Publishes Assessment of EU AML and CTF

On July 18, the Financial Industry Regulatory Authority (FINRA) published Regulatory Notice 19-24 (Notice), which encourages member firms to continue notifying their Regulatory Coordinators about their digital assets activities. The Notice extends the requested notification period originally set forth in Regulatory Notice 18-20 from July 31, 2019 to July 31, 2020. (For additional information regarding the amendment, please refer to the July 13, 2018 edition of Corporate & Financial Weekly Digest.) Member firms are encouraged to promptly notify their Regulatory Coordinators if its associated persons or affiliates currently engage in, or intend to engage in, any activities related to digital assets. Covered activities include, but are not limited to, purchases, sales and executions of digital assets transactions and the acceptance of cryptocurrencies from customers. FINRA is not requesting this information from firms that have already submitted a continuing membership application addressing their digital asset-related activities or have otherwise provided the covered information, unless a change has occurred.

The Notice is available here.