Corporate & Financial Weekly Digest

Corporate & Financial Weekly Digest

Tag Archives: swap dealers

CFTC Proposes Improvements to Initial Margin Segregation Rule

Posted in CFTC, Derivatives, Dodd-Frank Developments
The Commodity Futures Trading Commission KISS initiative has finally produced some substantive results for swap dealers in the form of proposed amendments to Subpart L of the CFTC’s regulations (“Segregation of Assets in Uncleared Swap Transactions”) that were issued for comment on July 24. Subpart L (which encompasses CFTC Regulations 23.700-704) has been problematic for… Continue Reading

CFTC Votes on a Final Rule and Two Proposed Rule Amendments

Posted in CFTC
On June 4, the Commodity Futures Trading Commission voted to approve a final rule to amend various portions of Part 49 of CFTC Regulations relating to swap data repository indemnification and related matters. The CFTC also voted to approve two rule proposals, including (1) proposed amendments relating to Volcker Rule restrictions on proprietary trading and… Continue Reading

CFTC Proposes To Maintain Swap Dealer Registration De Minimis Exception at $8 Billion

Posted in CFTC
The Commodity Futures Trading Commission is proposing various amendments to the de minimis exception from registration as a swap dealer. The de minimis exception provides that a person is not deemed to be a swap dealer unless its swap dealing activities exceed an aggregate gross notional amount of $8 billion measured over any 12-month period.… Continue Reading

CFTC Issues Proposed Rule to Amend Margin Requirements

Posted in CFTC, Derivatives
On May 17, the Commodity Futures Trading Commission released a proposed rule to amend the CFTC’s margin requirements for uncleared swaps for swap dealers and major swap participants. The proposed rule amendments are intended to make the same changes to the CFTC margin requirements that federal banking regulators recently proposed for the margin rules for… Continue Reading

CFTC Grants Relief to Certain Non-US Persons in Determining Swap Dealer and Major Swap Participant Status

Posted in CFTC, Derivatives
On May 16, the Commodity Futures Trading Commission’s Division of Swap Dealer and Intermediary Oversight (DSIO) provided no-action relief for certain non-US persons from counting swaps with international financial institutions, such as the International Monetary Fund, that are incorporated or based in the United States in determining swap dealer and major swap participant status as… 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

Posted in CFTC, Derivatives
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… Continue Reading

CFTC Extends Exemptive Relief From Quarterly Account Statements

Posted in CFTC
On February 20, the Commodity Futures Trading Commission’s Division of Swap Dealer and Intermediary Oversight issued Exemptive Relief Letter 18-05, which granted relief to a commodity pool operator (CPO) of a commodity pool operated as a “fund of funds.” The Letter provided the CPO with additional time after the end of each calendar quarter to… Continue Reading

CFTC Extends Time-Limited No-Action Relief for Entities Submitting Swaps for Clearing With Certain DCOs

Posted in CFTC, Derivatives
On February 20, the Commodity Futures Trading Commission’s Division of Market Oversight (DMO) published Staff Letter 18-03, which extends the time-limited no-action relief provided in Staff Letter 16-85 for entities submitting swaps for clearing by derivatives clearing organizations (DCOs) operating under (1) exemptive orders issued by the CFTC; or (2) no-action relief granted by the… Continue Reading

Filing Requirements for Swap Valuation Dispute Notices and Monthly Swap Dealer Risk Data Reporting Requirements are Effective January 2018

Posted in CFTC
On December 19, 2017, the National Futures Association (NFA) issued a reminder notice to its members regarding the upcoming effective dates for the submission of standardized data for swap valuation dispute notices (see Notice I-17-13) and monthly risk data reports (see notice I-17-10, as reported in the June 2, 2017, edition of Corporate and Financial… Continue Reading

CFTC Approves Exemption From SEF Registration Requirements for Multilateral Trading Facilities and Organized Trading Facilities Authorized Within the EU

Posted in CFTC, Derivatives
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 Staff Issues Interpretive Guidance Clarifying Commodity Trading Advisor Registration Requirements Resulting from the European Union’s MiFID II Research Compensation Provisions for Investment Managers

Posted in CFTC, Derivatives
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… Continue Reading

SEC Division of Corporation Finance Issues C&DI Clarifying Exemptions for Non-GAAP Information in Forecasts for M&A Transactions

Posted in SEC/Corporate
On October 17, the staff of the Securities and Exchange Commission’s Division of Corporation Finance issued guidance related to the scope of Regulation G’s exemption for disclosure of non-generally accepted accounting principles (GAAP) information.… Continue Reading

CFTC Extends Swap Dealer De Minimis Threshold Until December 2019

Posted in CFTC, Derivatives
On October 26, the Commodity Futures Trading Commission issued an Order that maintains the swap dealer de minimis threshold at $8 billion until a new de minimis threshold phase-in termination date of December 31, 2019. Prior to the Order, the threshold was set to decrease to $3 billion on December 31, 2018. The CFTC continues… Continue Reading

Three Developments Concerning EU-US Cross-Border Swaps

Posted in CFTC, Derivatives, Dodd-Frank Developments, EU Developments
On October 13, the Commodity Futures Trading Commission and the European Commission (EC) made three announcements that are significant for cross-border swap activity between the United States and Europe. CFTC Margin Rule Comparability Determination. The CFTC has made a determination that the margin rules for uncleared swaps that apply in the European Union are comparable to… Continue Reading

CFTC Provides No-Action Relief From CPO and CTA Registration to a Private University

Posted in CFTC
On September 13, the Division of Swap Dealer and Intermediary Oversight (DSIO or Division) of the Commodity Futures Trading Commission (CFTC or Commission) granted no-action relief from commodity pool operator (CPO) and commodity trading advisor (CTA) registration to a private university, subject to certain conditions. At issue was (1) the university’s collective management of an… Continue Reading

CFTC Provides No-Action Relief From Commission Regulation 4.7(b)(2) Reporting Requirements

Posted in CFTC
The Division of Swap Dealer and Intermediary Oversight (DSIO or Division) of the Commodity Futures Trading Commission (Commission or CFTC) recently granted no-action relief from the reporting requirements of CFTC Rule 4.7(b)(2) to a commodity pool operator (CPO) of two commodity pools, subject to certain conditions. CFTC Rule 4.7(b)(2) places a reporting requirement on a… Continue Reading

CFTC Grants DCO Registration to LedgerX

Posted in CFTC, Derivatives
The Commodity Futures Trading Commission has issued an order granting LedgerX LLC registration as a derivatives clearing organization (DCO). As specified in the order, LedgerX is permitted to clear fully collateralized digital currency swaps. A transaction will be fully collateralized if LedgerX holds, at all times, funds in the form of the required payment sufficient… Continue Reading

CFTC Extends Relief From Transaction-Level Requirements for Non-US Swap Dealers

Posted in CFTC, Derivatives
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… Continue Reading

NFA Adopts Interpretive Notice on Swap Valuation Disputes

Posted in CFTC, Derivatives
National Futures Association (NFA) has adopted an interpretive notice that standardizes the process for filing swap valuation disputes with NFA. As set forth in the interpretive notice, swap dealers (SDs) generally are required to file with NFA notices of unresolved swap valuation disputes involving initial margin, variation margin and/or transaction or portfolio valuations if the… Continue Reading

NFA Adopts 4s Attestation Process for Swap Dealers and Major Swap Participants

Posted in CFTC, Derivatives
National Futures Association (NFA) has revised the process by which each swap dealer (SD) and major swap participant (MSP) applicant demonstrates its ability to comply with Commodity Futures Trading Commission regulations implementing Section 4s of the Commodity Exchange Act (4s Regulations), including but not limited to regulations relating to capital and margin requirements, reporting and… Continue Reading

CFTC Announces Review of Swaps Reporting Regulations

Posted in CFTC
On July 10, the Commodity Futures Trading Commission’s Division of Market Oversight (Division) issued Staff Letter 17-33 (Staff Letter), which announced the launch of a comprehensive review of swap data reporting requirements. The review will focus on existing regulations with the goal of (1) ensuring the CFTC receives accurate, complete and high-quality data regarding swap… Continue Reading

CFTC Extends No-Action Relief to SEFs and DCMs From Certain Error Correction Regulations

Posted in CFTC
On May 30, the Commodity Futures Trading Commission’s (CFTC) Division of Market Oversight and Division of Clearing and Risk (Divisions) issued Staff Letter 17-27, extending previously granted no-action relief to swap execution facilities (SEFs) and designated contract markets (DCMs) from restrictions on using pre-arranged trades to correct clerical or operational errors that (1) caused a… Continue Reading

NFA Issues Notice Regarding Monthly Risk Data Reporting Requirements for Swap Dealers

Posted in CFTC
On May 30, the National Futures Association (NFA) issued Interpretive Notice I-17-1 (Notice), which sets forth the specific list of risk metrics that swap dealers (SDs) will be required to electronically report to NFA on a monthly basis, beginning with the initial January 31, 2018, reporting deadline. NFA intends to use this information to assess… Continue Reading

CFTC Proposes Amendments to Certain Rules Governing CCO Duties and Annual Reports

Posted in CFTC
On May 3, the Commodity Futures Trading Commission announced proposed rules amending its regulations regarding certain duties of chief compliance officers (CCOs) of swap dealers (SDs), major swap participants (MSPs) and futures commission merchants (FCMs; each, a Registrant). In addition, the proposed rules amend certain requirements for preparing and furnishing CCO annual reports on a… Continue Reading