CFTC Staff Letters

The Division of Clearing and Intermediary Oversight took a CPO registration no-action position with respect to the independent trustees of a commodity pool where the independent trustees had no authority to perform CPO functions, the independent trustees were appointed solely to comply with audit committee requirements under the Sarbanes Oxley Act and exchange listing requirements, and a separate registered CPO was authorized to perform all commodity pool operator functions. The Division further granted exemptive relief from certain of the Part 4 regulations to the registered CPO of a commodity pool, whose shares the CPO intended to publicly offer and to list for trading on a national securities exchange. As is discussed in the letter, this relief was in the nature of substituted compliance with those regulations.

The CPO of a proprietary commodity pool (consisting only of the CPO and the CPO’s mother) requested relief from Commission Regulation 4.22(d), which requires certification of the pool’s annual report. The pool had, as of the close of its fiscal year, only $XXX,XXX in total assets, and the pool’s participants had received monthly account statements prepared by an unassociated third-party accounting firm. The CPO submitted signed waivers from each of the pool’s participants consenting to the exemption from the certified annual relief requirement. DCIO granted relief pursuant to Commission Regulations 140.93 and 4.12(a).

The CPO of commodity pool requested relief to use IFRS in lieu of US GAAP. DCIO granted relief pursuant to Commission Regulations 140.93 and 4.12(a).

The CPO of commodity pool requested relief to use IFRS in lieu of US GAAP. DCIO granted relief pursuant to Commission Regulations 140.93 and 4.12(a).

The CPO of commodity pool requested relief to use IFRS in lieu of US GAAP. DCIO granted relief pursuant to Commission Regulations 140.93 and 4.12(a).

The Division of Clearing and Intermediary Oversight took a CPO registration no-action position with respect to the trustee of a commodity pool where the trustee had no authority to perform CPO functions, and a separate registered CPO was authorized to perform such functions. The Division further granted exemptive relief from certain of the Part 4 regulations to the registered CPO of a commodity pool, whose shares the CPO intended to publicly offer and to list for trading on a national securities exchange. As is discussed in the letter, this relief was in the nature of substituted compliance with those regulations. Finally, the Division granted exemptive relief from certain of the Part 4 regulations to the registered CTA of a commodity pool where the CTA was an affiliate of the pool’s CPO.

The CPO requested relief from the requirement of Regulation 4.7(b) that the Pool file a certified Annual Report within 90 days of the end of the fiscal year on June 30, 2009. The CPO requested permission to file a single, certified Annual Report for the Pool for the 13-month period from July 1, 2008 through July 24, 2009, upon which date the Pool ceased trading and distributed funds to participants. Pursuant to the authority delegated by Regulations 140.93 and 4.12(a), the Division granted relief from the Annual Report requirement of Regulation 4.7(b) for the Pool’s fiscal year ending June 30, 2009.

The CPO of a commodity pool with the majority of its assets embroiled in a bankruptcy requested relief from the ongoing reporting requirements under Part 4. The CPO filed an Annual Report for the Pool for the 2008 fiscal year, which contained information regarding the bankruptcy. DCIO granted relief pursuant to Regulations 140.93 and 4.12(a), but conditioned such relief on the following representations being made to the Commission and participants: the Pool has ceased trading; the pertinent facts regarding the bankruptcy and the frozen assets, including, but not limited to, the value of the assets, the percentage of the Pool’s NAV that the frozen assets represent, and the date upon which the bankruptcy petition was filed; the pertinent facts regarding the value of any assets presently being held by the Pool that have not been distributed to participants and the reasons for their retention; a representation that no additional fees will be deducted from the assets held by the Pool; the pertinent facts regarding the disposition of any income generated by the assets held by the Pool, if any; a representation regarding whether any assets have been distributed to participants; a representation regarding how payouts from the bankruptcy estate will be distributed to participants; i.e., whether distributions will be made as funds are received from the bankruptcy estate or whether payouts will be retained by the Pool until the final payout is received from the estate; a representation regarding any write down of the value of the claim against the bankruptcy estate; a representation regarding the distribution of assets on a pro rata basis to participants; and a representation that the financial information contained in the Pool’s liquidation report remains accurate. Additionally, DCIO required that the CPO make a final disclosure to the Commission and participants upon the final disbursement of the Pool’s assets.

The CPO of a pool in liquidation requested relief from the certification requirement under Commission Regulation 4.22 with respect to the pool’s final annual report for the period from January 1, 2009 through May 31, 2009. The CPO provided waivers from all of the participants in the pool agreeing to an uncertified final annual report. Pursuant to Commission Regulations 140.93 and 4.12(a), the DCIO granted the relief requested.

The CPO of two pools in a master-feeder structure requested stub period relief due to the liquidation of the feeder fund. Rather than file a 12-month annual report, the CPO requested permission to file an 18-month report. Pursuant to Commission Regulations 140.93 and 4.12(a), the Division granted the relief requested.