The Commodity Futures Trading Commission has amended Regulation 1.35(a) to ease recordkeeping obligations for certain entities with respect to commodity interest transactions and related cash or forward transactions. Specifically, members of a designated contract market (DCM) or a swap execution facility (SEF) that are not registered with the CFTC in any capacity are no longer required to keep written pre-trade communications or text messages that lead to the execution of commodity interest transactions and related cash or forward transactions. Similarly, such unregistered entities are not required to keep their written records in any particular form and manner. Further, registered commodity trading advisors that are members of a DCM or a SEF are not required to record and keep oral pre-trade communications.
The CFTC also revised its rule to confirm that all required records must be kept in a form and manner that (1) permits prompt, accurate and reliable location, access, and retrieval; and (2) allows for identification of a particular transaction. In doing so, the CFTC clarified that the rule does not require market participants to convert records to searchable electronic databases.
The amendments to Rule 1.35(a) will be effective upon publication in the Federal Register.
The CFTC’s final rules are available here.