CFTC Issues Multiple Swap Related No Action Relief

CFTC’s Division of Market Oversight Extends Time-Limited, No-Action Relief for Swap Dealers and Major Swap Participants From Compliance With Reporting Obligations

Washington, DC – The Commodity Futures Trading Commission’s (“Commission”) Division of Market Oversight (“Division”) today issued a no-action letter extending time-limited relief to Swap Dealers (“SDs”) and Major Swap Participants (“MSPs”) from the obligation to report valuation data for cleared swaps as required by § 45.4(b)(2)(ii) of the Commission’s regulations.

The no-action letter provides that the Division will not recommend that the Commission take enforcement action against an SD or MSP for failure of such SD or MSP to comply with the requirements of regulation 45.4(b)(2)(ii) to report valuation data. The no-action relief applies to: (i) all SDs and MSPs that are reporting counterparties under regulation 45.4(b)(2)(ii), and (ii) all cleared swaps for which the SD or MSP has the obligation to report valuation data under regulation 45.4(b)(2)(ii). The no action relief expires on June 30, 2014

CFTC’s Division of Swap Dealer and Intermediary Oversight Issues No-Action Relief from Certain External Business Conduct Standards and Documentation Standards

Washington, DC — The Commodity Futures Trading Commission’s Division of Swap Dealer and Intermediary Oversight (DSIO) today announced the issuance of a no-action letter relating to certain duties imposed on swap dealers (“SDs”) and major swap participants (“MSPs”) pursuant to the Commission’s Business Conduct Standards with Counterparties (“External BCS”), as well as certain documentation requirements imposed on SDs and MSPs pursuant to Commission regulation § 23.504.

As defined in the letter, an “Intended-To-Be-Cleared Swap” (“ITBC Swap”) is one which is intended to be submitted for clearing contemporaneously with execution of such swap. Subject to certain conditions, in the context of an ITBC Swap where the SD or MSP does not know the identity of the counterparty to the ITBC Swap prior to execution (an “Anonymous ITBC Swap”), the letter provides relief for SDs and MSPs with respect to those External BCS requirements that are specified in Appendix A to the letter and the swap trading relationship documentation requirement under Commission regulation § 23.504. In addition, the letter provides, subject to conditions, relief for SDs and MSPs with respect to the swap trading relationship documentation requirement under Commission regulation § 23.504 in the context of an ITBC Swap where the SD or MSP knows the identity of the counterparty.

The no-action letter is applicable to all SDs and MSPs. Additionally, to rely on the relief provided in the no-action letter, an SD or MSP must first enter into a fallback agreement, as defined in the letter, with the applicable counterparty (or its duly authorized representative) which meets the conditions of the letter.

CFTC’s Division of Swap Dealer and Intermediary Oversight Issues No-Action Relief for Certain Swap Dealers Concerning Annual Reports of Chief Compliance Officers

Washington, DC — The Commodity Futures Trading Commission’s (CFTC) Division of Swap Dealer and Intermediary Oversight (DSIO) issued a no-action letter that provides certain swap dealers (SDs) with limited relief surrounding the requirement that chief compliance officers of such SDs prepare and submit an Annual Report, pursuant to Commission Regulation 3.3.

The relief provided in the no-action letter is applicable to all SDs that: (1) are not registrants of the Securities and Exchange Commission or regulated by a U.S. prudential regulator; and (2) ended their fiscal year on March 31, 2013 (Covered Firms).

The no-action letter enumerates the subjects that must be addressed in the Annual Report of a Covered Firm for the fiscal year that ended on March 31, 2013. The letter also provides relief concerning the certification that a chief compliance officer must execute with respect to the Annual Report.

 

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