At its open meeting on June 4, the Commodity Futures Trading Commission (CFTC) unanimously approved a final rule prohibiting persons from seeking to claim a Commodity Pool Operator registration exemption under CFTC Rule 4.13 who are, or whose principals are, subject to any of the statutory disqualifications listed in Section 8a(2) of the Commodity Exchange Act (CEA).
Continue Reading CFTC Unanimously Approves Final Rule Regarding CPO Registration Exemption

On May 19, the National Futures Association (NFA) submitted to the Commodity Futures Trading Commission proposed amendments to Part 3 of NFA’s Compliance Rules regarding the compliance procedures that control NFA’s disciplinary process. Specifically, the proposed amendments (1) revise NFA Compliance Rule 3-14 to increase the maximum penalty fine amount from $250,000 to $500,000 per violation; (2) modify the rules related to certain Business Conduct Committee’s practices; and (3) make minor technical amendments.
Continue Reading NFA Proposes Amendments to Part 3 of NFA’s Compliance Rules Regarding Disciplinary Process

On December 18, the Division of Swap Dealer and Intermediary Oversight (DSIO), the Division of Market Oversight (DMO) and the Division of Clearing and Risk (DCR) each issued a no-action letter providing relief to market participants in preparation for the transition away from the London Interbank Offered Rate (LIBOR) and other interbank offered rates (collectively with LIBOR, IBORs). The letters identify the terms and conditions pursuant to which counterparties may be eligible for relief in connection with amending swaps to replace provisions referencing discontinued IBORs with alternative benchmarks.
Continue Reading CFTC Grants Market Participants LIBOR-Transition Relief

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 June 25, 2019, the Commodity Futures Trading Commission announced that it had approved the application of LedgerX LLC (LedgerX) for designation as a contract market under Section 5 of the Commodity Exchange Act (CEA) and Part 38 of the CFTC’s regulations. LedgerX has been registered with the CFTC as a swap execution facility and

On March 6, the Commodity Futures Trading Commission’s Division of Enforcement issued an Enforcement Advisory regarding self-reporting and cooperation for violations of the Commodity Exchange Act (CEA) involving foreign corrupt practices. Providing further guidance regarding the Enforcement Division’s cooperation and self-reporting program, the Advisory notes that the Enforcement Division will apply a presumption that it

The Commodity Futures Trading Commission is requesting public comment on a rule amendment certification filing by ICE Futures U.S., Inc. (IFUS). As described in the certification, the proposed amendment to IFUS Rule 4.26 would allow for the implementation of Passive Order Protection (POP) Functionality, which is intended to reduce latency advantages between traders engaged in arbitrage strategies against related markets. The POP Functionality proposed by the certification would be implemented in the daily gold and silver futures markets.
Continue Reading CFTC Requests Public Comment on a Rule Amendment Certification Filing by ICE Futures U.S.

On November 5, the Commodity Futures Trading Commission held an open meeting to consider the following matters relating to swaps and swap execution facilities:

  • Final Rule: Amending the De Minimis Exception to the Swap Dealer Definition
  • Proposed Rule: Amendments to Regulations on Swap Execution Facilities and Trade Execution Requirement
  • Request for Comment Regarding the Practice of “Post-Trade Name Give-Up” on Swap Execution Facilities


Continue Reading CFTC Takes Action on Rules Relating to Swaps and Swap Execution Facilities

On December 8, in response to a request by the European Commission (EC), the Commodity Futures Trading Commission issued an order exempting certain multilateral trading facilities (MTFs) and organized trading facilities (OTFs) authorized within the European Union (EU) from the requirement to register with the CFTC as swap execution facilities (SEFs).
Continue Reading CFTC Approves Exemption From SEF Registration Requirements for Multilateral Trading Facilities and Organized Trading Facilities Authorized Within the EU