Commodity Futures Trading Commission (CFTC)

CFTC Further Extends Certain No-Action Relief to Market Participants in Response to COVID-19

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On September 11, the Commodity Futures Trading Commission (CFTC) announced the Division of Swap Dealer Intermediary Oversight (DSIO) and the Division of Market Oversight (DMO) are further extending certain elements of the temporary no-action relief issued in response to the COVID-19 pandemic that are set to expire on September 30. The extended relief expires January 15. Such relief includes relief for affected firms from CFTC regulations related to voice trading and other telephonic communications, as well as time-stamping requirements when located in remote, socially-distanced locations. No-action relief will also be extended for SEFs and DCMs from certain CFTC regulations regarding audit trails, recording of oral communications, and related requirements as a result of the displacement of trading personnel from their normal business sites. Release.

CFTC Approves Proposed Amendments to Margin Requirements for Swap Dealers and Major Swap Participants

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On August 14, the Commodity Futures Trading Commission (CFTC) approved two proposed amendments to margin requirements for Swap Dealers and Major Swap Participants (the “CFTC Margin Rule”). The first proposal would, among other changes, revise the method for determining whether an entity comes within the scope of the initial margin requirements under the CFTC Margin Rule and the timing for compliance. The second proposal would permit the application of separate minimum transfer amounts for initial and variation margin, as well as a minimum transfer amount of up to $50,000 for separately managed accounts. Each proposal will be subject to a 30-day comment period following publication in the Federal Register. Release.

CFTC Approves Amendments to Rules on Intermediary Registration and Review of Adverse Actions

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On January 9, 2018, the U.S. Commodity Futures Trading Commission (the “CFTC“) approved final rules that update Parts 3 and 9 to integrate existing advisory guidance, incorporate swap execution facilities (“SEFs“) and update provisions currently applicable to designated contract markets (“DCMs“). Part 3 governs registration of intermediaries and Part 9 relates to CFTC review of exchange disciplinary, access denial, or other adverse actions. Press Release. Rules.

 

CFTC Comparability Determination on EU Margin Requirements and a Common Approach on Trading Venues

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On October 13, 2017, the U.S. Commodity Futures Trading Commission (“CFTC“) announced determinations by the CFTC and the European Commission (“EC“) on comparability and equivalence of margin requirements for uncleared swaps. CFTC Commissioners unanimously approved a comparability determination finding the margin requirements for uncleared swaps under the laws and regulations of the European Union (“EU“) comparable in outcome to those under the Commodity Exchange Act (CEA) and CFTC regulations. This determination is effective immediately. This announcement coincides with the EC’s announcement of an equivalence decision which similarly finds that the CFTC’s uncleared swap margin rules are comparable in outcome to the EU’s corresponding margin requirements for uncleared OTC derivatives. Additionally, the CFTC and EC announced a common approach regarding certain CFTC and EU authorized derivatives trading venues. Press Release. Rule. Common Approach.

CFTC Proposes to Amend Rules Governing Chief Compliance Officer Duties and Annual Reports for Certain Registrants

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On May 3, 2017, the U.S. Commodity Futures Trading Commission (CFTC) announced that it will publish in the Federal Register proposed amendments to Part 3 of its regulations. The proposed amendments would (1) define “senior officer” in Regulation 3.1; (2) clarify the duties of a Chief Compliance Officer (“CCO“) of a futures commission merchant, swap dealer, or major swap participant; and (3) modify the CCO annual report’s content and submission requirements. The comment period ends 60 days after the proposal’s publication in the Federal Register. Press Release. Proposal.

CFTC Unanimously Approves Final Rule Amendments to Its Regulations Regarding CPO Financial Reports

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On November 21, 2016, the U.S. Commodity Futures Trading Commission (“CFTC“) announced that it had approved amendments to its regulations applicable to commodity pool operators and the financial reports they are required to provide on their pools’ operations. The amendments are meant to incorporate into CFTC regulations certain exemptive relief previously provided through no-action or exemptive letters. Release.

CFTC Division of Market Oversight Reminds Market Participants of the Upcoming Expiration of Certain No Action Relief From the Ownership and Control Final Rule

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On November 16, 2016, the U.S. Commodity Futures Trading Commission (the “CFTC“) issued a reminder that previously specified no‑action relief will shortly be expiring. On November 18, 2016, at 12:00 a.m. Eastern time, revised electronic submission requirements for Forms 40/40S and 71 were put in effect. Release.

CFTC Approves Final Rule Amending the Timing for Filing Chief Compliance Officer Annual Reports by Certain Registrants

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On November 10, 2016, the U.S. Commodity Futures Trading Commission (the “CFTC“) issued a final rule modifying and clarifying previous guidance regarding compliance reports for futures commission merchants, swap dealers and major swap participants. Release.

U.S. Commodity Futures Trading Commission Divisions Issue Time-Limited No-Action Letter Extending Relief from Certain Recordkeeping Requirements Under Commission Regulations

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On December 8, 2015, the U.S. Commodity Futures Trading Commission’s (the “CFTC”) Division of Swap Dealer and Intermediary Oversight and Division of Market Oversight issued a time-limited no-action letter extending the relief provided in CFTC Letter No. 14-147. The relief would otherwise expire on December 31, 2015 and applies to commodity trading advisors (“CTAs”) that are registered with the CFTC and are members of designated contract markets (“DCMs”) or swap execution facilities (“SEFs”). The extension grants no-action relief to these entities from the requirement to record oral communications, and also to covered market participants from the requirement to link records of oral and written communication that lead to the execution of a transaction in a commodity interest and related cash or forward transactions. Such relief will expire on the effective date of any final CFTC action with respect to the CFTC’s proposal to amend Regulation 1.35(a). Press Release. No-Action Letter.

CFTC’s Division of Market Oversight Provides Additional Time to Comply with Electronic Reporting Requirements in the OCR Final Rule

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On September 28, the U.S. Commodity Futures Trading Commission’s (the “Commission”) Division of Market Oversight issued a no-action letter that provides reporting parties additional time to comply with certain reporting requirements of the ownership and control final rule.  The rule requires reporting parties to electronically submit trader identification and market participant data on new and updated forms.  These forms allow for better identification of participants in futures and swaps markets.  Providing reporting parties with additional time is aimed at improving the reliability and consistency of data provided to the Commission.  The no-action letter extends relief to dates ranging from April 27, 2016 to February 13, 2017.  Press Release.