CFTC Staff Letters

Extension of Time-Limited No-Action Relief for Swap Dealers and Major Swap Participants from Compliance with Reporting Obligations Under 17 CFR 45.4(b)(2)(ii).

No-Action Relief: Swaps Intended to be Cleared - Request for relief from certain disclosure and notice requirements and other duties imposed on swap dealers (SDs) and major swap participants (MSPs) pursuant to Commission regulations 23.402, 23.430, 23.431, 23.432, 23.434, 23.440, 23.450, and 23.451, as well as certain documentation requirements imposed on SDs and MSPs pursuant to Commission regulation 23.504.

Request for Time-Limited No-Action Relief for Certain Swap Dealers from Compliance with Requirements of Commission Regulation 3.3 Relating to Annual Reports by Chief Compliance Officers.

The Division of Swap Dealer and Intermediary Oversight (DSIO) issued a no-action letter stating that it will not recommend an enforcement action against an SD or MSP that omits certain "Excluded Data Fields" from the portfolio reconciliation process required under Regulation 23.502.

Extension of Time-Limited No-Action Relief from the Clearing Requirement for Swaps Entered into by Cooperatives. The Division is extending the relief provided in the June 7 No-Action Relief until July 19, 2013. Accordingly, the Division will not recommend that the Commission commence an enforcement action against a person for failure to comply with the requirement under section 2(h)(1)(A) of the CEA and part 50 of the Commissions regulation to clear a CDS or interest rate swap subject to required clearing in 50.4 of the Commissions regulations.

No-Action Relief: Alternative to Fingerprinting to Establish Fitness of Associated Persons Residing Outside the United States.

Staff No-Action Relief: Extension of the Regulatory Status Quo Established with Respect to Certain Transactions by the Commission’s Second Amendment to the July 14, 2011 Order for Swap Regulation.

Interpretation of Commission Regulation 1.73(a)(2)(iv).
Regulation 1.73 addresses risk management by clearing FCMs. Section (a)(2)(iv) provides that when a firm executes an order on behalf of a customer but gives it up to another firm for clearing, the clearing FCM shall establish risk-based limits and enter into an agreement in advance with the executing firm that requires the executing firm to screen orders for compliance with those limits.
Under the fact pattern you have described, ICAP would be the executing firm and the clearing firms selected by the customers would be the clearing FCMs within the meaning of Regulation 1.73(a)(2)(iv). The sponsoring FCM would be the clearing FCM for purposes of this provision only for those customers who had chosen that firm as their clearing FCM. Accordingly, the Division of Clearing and Risk (Division) can confirm that:
1. The term executing firm in Regulation 1.73(a)(2)(iv) refers to IBs or FCMs that execute orders for customers; and
2. An FCM that provides to an executing firm sponsored access to a market is not obligated under Regulation 1.73(a)(2)(iv), by virtue of the provision of such access, to conduct order screening of the executing firms customers.

Time-Limited No-Action Relief for Certain Banks Having Assets of Less than $10 billion from the Board Approval Requirement of Section 2(j) of the CEA and the End-User Exception to the Clearing Requirement (§ 50.50(b)(1)(iii)(D)(2)).

No-Action Relief for Corporación Andina de Fomento from the Swap Clearing Requirement in Section 2(h)(1) of the Commodity Exchange Act and Commission Regulations 50.2 and 50.4.