CFTC Staff Letters Archive

CFTC Staff Letters Archive provides Letters from 2007 and earlier. For Letters published 2008 or later visit the All Letters page.

There are no Advisory Letters or Other Written Communications for 2007 or earlier.

Date	PDF and Description
06/06/1997	97-41 ; Rule 4.7 (a)(1)(ii)(B)(2)(xi);; No-Action The Division of Trading and Markets provided relief under Rule 4.7(a) to registered CPOs which operate Rule 4.7(a) exempt pools in order that they may accept an investment of more than ten percent of the fair market value of the assets of an insurance company separate account which itself qualifies as a QEP but has among its investors several non-QEP irrevocable trusts. Each non-QEP trust: (1) was established primarily for estate planning purposes; and (2) has as its grantor and its investment decision-maker a QEP.
06/03/1997	97-93 ; Sections la, 2(a) (1) (A), 4, 5, and 6 of the Commodity Exchange Act;; No-Action The CFTC's Off-Exchange Task Force has issued a no-action letter recommending that the Commission not take enforcement action against certain individuals for operating, or participating in, a physical delivery electronic natural gas trading system. Trading on the system is limited to qualified commercial participants and transactions executed on the system impose binding physical delivery obligations on the participants. The Task Force has determined that the operation of this physical delivery trading system does not require designation as a contract market, registration under the Commodity Exchange Act (Act), or compliance with the Act or Commission Regulations except such parts thereof that relate to manipulation.
06/02/1997	97-40 ; Section 4(m)(1) - CPO Registration;; No-Action The Division of Trading and Markets took a CPO registration no-action position against a co-general partner and CPO of a pool where the person was the sole shareholder and would be registered as an associated person and listed as a principal of the other general partner and CPO.
05/28/1997	97-42 ; Rule 4.31;; No-Action The Division of Trading and Markets exempted a registered CTA from compliance with Rule 4.31 in that it was not required to provide a disclosure document to an offshore fund for which it had discretionary authority to trade commodity interests. The registered CTA had only one client, which was the offshore fund.
05/28/1997	97-39 ; Rule 4.10(d)(1);; No-Action The Division of Trading and Markets granted "no-action" relief in the case of a limited liability company (the Company) registered as a broker-dealer and as a Chicago Board Options Exchange member. The members of the Company's management committee were not required to register as CPOs and the Company's traders were not required to register as CTAs. The Division's no-action positions were conditioned upon: (1) restriction of membership eligibility in the Company to its traders and its managers having supervisory or financial decision-making authority; (2) commodity interest trading on behalf of the Company is restricted to S&P 500 futures contracts and options on S&P 500 futures; (3) written representations that members' interests do not represent indirect investments by others; (4) submission to special calls by the Division; and (5) floor broker registration for each Company member trading commodity interests and executing commodity interest transactions.
05/16/1997	97-48 ; Section 4m(1) of the Act; Advisory 18-96;; No-Action The Division took a CPO registration no-action position with respect to the foreign operator (Operator) of a foreign fund where, among other things: (1) an affiliate of the Operator is a registered CPO and will serve as the CPO of the fund; (2) the Operator is jointly owned by an affiliate of the CPO and a foreign firm; (3) the fund's Board of Directors will consist of two U.S. persons who are registered as APs and listed principals of the CPO; (4) the CPO will be responsible for hiring and firing the fund's CTA and selecting and changing the fund's FCM; (5) within thirty days the CPO and the Operator provide the Division with signed and dated acknowledgments therein each agrees to be jointly and severally liable with the other for any violations of the Act and the Commission's regulations issued thereunder applicable to CPOs in connection with the operation of the Fund. In addition, the Division confirmed that a notice pursuant to Advisory 18-96 may be filed on behalf of a fund notwithstanding the ownership therein of the fund's CTA, a U.S. person.
05/09/1997	98-45 ; Section 4(b);; No-Action The Division of Trading and Markets (Division) would not recommend enforcement action to the Commission against the Deutsche Terminborse (DTB) if DTB terminals were installed in DTB member firm booths on the floor of the Chicago Mercantile Exchange. The Division's no-action position was subject to, among other things, all of the terms and conditions of the Division's February 29, 1996, no-action letter to the DTB, (CFTC Interpretative Letter No. 96-28, (1994-1996 Transfer Binder] Comm. Fut. L. Rep. (CCH) f26,669), in which the Division agreed not to recommend that the Commission take enforcement action against the DTB if, under certain conditions, DTB terminals were installed in the U.S. offices of DTB members without the DTB becoming designated as a U.S. contract market.
05/08/1997	97-58 ; Rule 4.7(a), 4m(1);; No-Action The Division of Trading and Markets (T&M) permitted an employee limited partnership (EE L.P. II) to be treated as a QEP for the purpose of investing in a pool operated by an affiliate of the employees' employer. T&M also issued CPO and CTA registration "no-action" relief to the operator/advisor of EE L.P. II, based upon, among other things, representations that participants in EE L.P. II would be restricted to senior management officials who were "accredited investors."
05/05/1997	97-45 ; Section 4(b) and 4(d) (2) of the Act; Commission Rules 1.20, 1.41(a)(3), 30.7(c);; No-Action The Division of Trading and Markets provided "no-action" relief with respect to an FCM's failure to obtain and retain an acknowledgment letter from a clearing organization concerning the treatment of customer funds and the secured amount deposited by the FCM with the clearing organization. This relief is subject to the condition that the clearing organization depository of such funds has adopted and submitted for Commission approval rules which provide for the segregation (as customer funds or the secured amount, as appropriate, in accordance with all relevant provisions of the Commodity Exchange Act and the Commission's rules and orders promulgated thereunder) of all funds held on behalf of customers.
04/29/1997	97-37 ; Section 4m(1);; No-Action The Division of Trading and Markets took companion "no-action" positions concerning the acquisition by two bank holding company subsidiaries of, respectively, the general partner interest in a group of investment partnerships (one of which (A) participates in commodity pools), and registered investment adviser affiliated with the outgoing general partner of the investment partnerships. The subsidiary acquiring the general partner interests (a newly-formed corporation) was relieved from registering as a CPO and the subsidiary acquiring the investment adviser (a national bank) was relieved from registering as a CTA. Relief was conditioned upon: (1) compliance by the bank holding company and its subsidiaries with commitments made to the Federal Reserve Board in connection with the acquisition transaction, and with operating restrictions set forth in the relief request; (2) notification of the Division concerning the name of any additional investment partnership(s) when selected; (3) no participation in commodity pools by investment partnerships that do not presently so invest, absent further relief or registration of the general partner subsidiary as a CPO; (4) each pool which "A" participates is operated by a registered CPO and advised by a registered CTA; and (5) the holding company and acquiring subsidiaries submit to special calls.