Division of Market Oversight

On April 22, the Commodity Futures Trading Commission’s Division of Data, Division of Market Oversight and Division of Clearing and Risk (collectively, the Divisions) issued CFTC Letter No. 21-11, which (1) provides no-action relief to KalshiEX LLC (Kalshi), a designated contract market, and LedgerX, LLC (LedgerX), a derivatives clearing organization, from reporting to swap data repositories data for binary option transactions executed on or subject to the rules of Kalshi and cleared by LedgerX; and (2) exempts Kalshi and LedgerX from certain related recordkeeping requirements.
Continue Reading CFTC Issues Conditional Relief From Reporting Fully Collateralized Binary Option Data to Swap Data Repositories

On January 19, the Commodity Futures Trading Commission’s Market Participants Division (MPD) and Division of Market Oversight (DMO) issued CFTC Staff Letter No. 21-04 and Letter No. 21-05 (the Staff Letters) to extend, for a limited time, parts of the temporary no-action relief granted in response to the COVID-19 pandemic, which expired on January 15.
Continue Reading CFTC Staff Provides Limited Continuation of Certain No-Action Relief to Market Participants in Response to COVID-19

On December 17, the Commodity Futures Trading Commission’s Division of Market Oversight issued CFTC Letter No. 20-45, which extends relief from the trade execution requirement for certain inter-affiliate transactions provided under CFTC Letter No. 17-67 (available here) and prior staff letters. CFTC Letter No. 17-67 provides relief from the trade execution requirement under CFTC Regulation 50.52(a) with regard to swaps that are entered into by eligible affiliate counterparties and cleared, regardless of the affiliates’ ability to claim the inter-affiliate clearing exemption under CFTC Regulation 50.52(b). The no-action relief was set to expire on December 31.
Continue Reading CFTC Extends Temporary No-Action Relief From Trade Execution Requirement for Certain Affiliated Counterparties

On November 19, the Commodity Futures Trading Commission’s Division of Market Oversight (DMO) issued a staff letter extending no-action relief to certain CFTC-registered swap dealers (SDs) and major swap participants (MSPs). The no-action relief, which was initially granted in 2013 and subsequently extended several times, was set to expire on December 1.
Continue Reading CFTC Extends Temporary Swap Data Reporting Relief for Certain International Swap Dealers and Major Swap Participants

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 13, the Commodity Futures Trading Commission’s Division of Market Oversight (DMO) issued CFTC Staff Letter No. 20-36, which extends no-action relief to swap execution facilities (SEFs) from the requirement to capture post-execution allocation information in their audit trail data.
Continue Reading CFTC Extends No-Action Relief to SEFs From Certain Audit Trail Requirements Related to Post-Execution Allocation Information

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

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 Division of Swap Dealer and Intermediary Oversight, the Division of Clearing and Risk and the Division of Market Oversight (collectively, the Divisions) of the Commodity Futures Trading Commission have extended relief previously provided in a series of previous no-action letters relating to transaction-level requirements for non-US swap dealers (non-US SDs). Specifically, the Divisions have granted relief to non-US SDs from certain specified “transaction-level requirements” when using personnel or agents located in the United States to arrange, negotiate or execute swaps with non-US persons that are not guaranteed affiliates or conduit affiliates of a US person.
Continue Reading CFTC Extends Relief From Transaction-Level Requirements for Non-US Swap Dealers