Division of Swap Dealer and Intermediary Oversight

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On October 6, the National Futures Association (NFA) issued Notice I-20-37 to announce changes to the no-action relief that had previously been issued relating to fingerprinting requirements for applicants for registration as an associated person (AP) and natural person principals of an applicant or registrant found at NFA Registration Rules 204(a)(2)(A) and 206(a)(1)(A).
Continue Reading NFA Issues Notice on Expiration of Temporary Relief from Fingerprinting Requirements

By a vote of 3-2, on July 23, the Commodity Futures Trading Commission adopted its Final Cross-Border Swaps Rulemaking (Final Cross-Border Rule), which codifies several parts of the CFTC’s existing interpretive guidance and policy statement on the subject. Among other things, the Final Cross-Border Rule establishes key definitions, some of which are revised definitions of existing terms used in the interpretive guidance (e.g., the definition of “U.S. Person”) and others which are new. The rule also addresses which cross-border swaps must be considered for the purposes of the swap dealer registration threshold.
Continue Reading CFTC Adopts Final Cross-Border Swap Rulemaking; Staff Issues No-Action Relief for ANE Transactions

In response to the COVID-19 pandemic, the Commodity Futures Trading Commission’s Division of Swap Dealer and Intermediary Oversight (DSIO) issued no-action relief to commodity pool operators (CPOs) extending the upcoming filing deadlines for required pool quarterly reports on CFTC Form CPO-PQR, as well as annual reports and periodic account statements provided to pool participants. National Futures Association (NFA) also issued similar relief to CPOs for pool quarterly reporting requirements on NFA Form PQR and to commodity trading advisors (CTAs) for quarterly filings on NFA Form PR.
Continue Reading Regulatory Relief Issued for CPOs and CTAs

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’s Division of Swap Dealer and Intermediary Oversight and Division of Clearing and Risk have issued CFTC Staff Advisory 19-17 (the Advisory), providing 1) guidance with respect to CFTC Rule 1.56(b); and 2) time-limited no-action relief with respect to CFTC Rule 39.13(g)(8)(iii), as those rules relate to the treatment of separate accounts of the same customer (i.e., beneficial owner). The Advisory responds to several requests for guidance following the publication of Joint Audit Committee (JAC) Regulatory Alerts #19-02 and #19-03.
Continue Reading CFTC Staff Provide Guidance, No-Action Relief With Respect to the Treatment of Separate Accounts by FCMs

On March 30, the Commodity Futures Trading Commission’s Division of Swap Dealer and Intermediary Oversight (DSIO) issued Letter 18-09, which granted exemptive relief to a commodity pool operator (CPO) of a foreign “Master Fund” and a US “Feeder Fund.” CFTC rules generally require that the financial statements a CPO is required to provide US pool participants, both in periodic reports and the annual report, must be prepared in accordance with US generally accepted accounting principles (US GAAP). However, where the pool is organized under the laws of a foreign jurisdiction, CFTC Rule 4.22(d)(2)(i) authorizes a CPO to compute and present financial statements in accordance with applicable accounting standards in that jurisdiction, including International Financial Reporting Standards (IFRS), subject to the conditions set out in the Rule.
Continue Reading CFTC’s Division of Swap Dealer and Intermediary Oversight Extends Exemptive Relief From CFTC Regulations 4.7 and 4.2 Requirement to Prepare Financial Statements in Accordance With US GAAP

On December 11, at the request of the Futures Industry Association (FIA), the Commodity Futures Trading Commission’s Division of Swap Dealer and Intermediary Oversight (Division) issued an interpretive letter regarding the “solely incidental” exclusion from registration as a commodity trading advisor (CTA). Under the relevant provisions of the Commodity Exchange Act and CFTC rules, a futures commission merchant (FCM), swap dealer (SD) or introducing broker (IB) that provides commodity trading advice is required to be registered separately as a CTA unless such advice is “solely incidental” to the conduct of such registrant’s business as an FCM or SD (or “solely in connection with” such registrant’s business as an IB).
Continue Reading CFTC Staff Issues Interpretive Guidance Clarifying Commodity Trading Advisor Registration Requirements Resulting from the European Union’s MiFID II Research Compensation Provisions for Investment Managers

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

The Commodity Futures Trading Commission’s Division of Swap Dealer and Intermediary Oversight (DSIO) has issued exemptive relief to commodity trading advisors (CTAs) from the requirement to keep records under CFTC Regulations 4.7(c)(2) and 4.33 at the CTA’s main business office. As provided in the exemptive letter, a CTA may use a third-party recordkeeper so long …