CFTC Staff Letters

No-action relief from the swap clearing requirement for a bank holding company or savings and loan holding company with consolidated assets of $10 billion or less.

Extension of Time-Limited No-Action Relief with Respect to Certain Commodity Exchange Act Provisions That May Apply to Southwest Power Pool, Inc. and/or Its Participants

The Division will grant the above time-limited no-action relief from the requirements for SEFs to capture post-trade allocation information in their audit trail data and to conduct associated audit trail reviews of post trade allocations, and will not recommend that the Division take enforcement action against any SEF that does not capture post-trade allocations in its audit trail data or conduct associated audit trail reviews of post trade allocations, as required by Commission regulations 37.205(a) and (b)(2).

As the Commission continues to consider the issues in the Proposed Amendment, the Divisions believe an extension of the no-action relief in CFTC Staff Letter No. 14-147 is warranted. Accordingly, with respect to Regulation 1.35(a), the Divisions will not recommend an enforcement action against a CTA that is a member of a DCM or of a SEF for failure to maintain records of oral communications and will not recommend an enforcement action against a market participant subject to Regulation 1.35(a) on the grounds that its records of oral and written communications that lead to the execution of a transaction are not linked to or otherwise identified with a particular transaction.

Wells Fargo requests no-action relief permitting the London Branch and its counterparties to comply with the relevant requirements applicable to its Foreign Clients in lieu of the Commissions Transaction-Level Requirements. Wells Fargo requests the no-action relief only with respect to swaps between the London Branch and its Foreign Clients. Based on the foregoing and the representations made by Wells Fargo, the Divisions believe that granting no-action relief is warranted.

The purpose of this letter is to extend no-action relief previously granted by the Division of Clearing and Risk (Division) of the Commodity Futures Trading Commission (Commission) under No-Action Letter 14-135 that addressed certain challenges faced by market participants arising from the fact that other jurisdictions are still in the process of implementing mandatory clearing regimes.

On November 7, 2014, in response to a request from ISDA similar to that previously received,6 the Division issued CFTC Letter No. 14-136 extending the relief granted in CFTC Letter No. 14-26 until December 31, 2015. The Division explained that the rationale for relief was unchanged and it needed additional time to assess whether the relief should be permanent. On August 31, 2015, ISDA again requested that the Commission exercise its authority pursuant to CEA section 4(c) to establish a permanent exemption for inter-affiliate swaps from the trade execution requirement under CEA section 2(h)(8). To allow time for the Commission to consider the request, ISDA requested that the Commission further extend the relief granted in CFTC Letter No. 14-26. The Division has determined to extend the no-action relief granted by CFTC Letter No. 14-26 until 11:59 p.m. (Eastern Time) December 16, 2016.

As noted in the Request Letter, the Commission has not yet issued comparability determinations as to whether the regulatory requirements of any foreign jurisdiction are comparable to and as comprehensive as the applicable requirements under the Commodity Exchange Act and Commission regulations with respect to the SDR Reporting Rules.5 While review of those requests for comparability determinations that have been received by the Commission continues, the Division believes that it would be appropriate to provide an extension of the time-limited no-action relief provided in CFTC Letter No. 14-141.

The Division agrees that SEFs can facilitate the pre-trade credit checks that are required for FCMs and SEFs to comply with §§1.73 and 37.702(b), respectively. The Division has determined to extend the no-action relief provided in No-Action Letter 14-118.

Extension of conditional time-limited no-action relief for Yieldbroker Pty Limited with regard to Section 5h(a)(1) of the Commodity Exchange Act and Commission Regulation 37.3(a)(1) until May 15, 2016.