By letter dated November 5, 2014, the Division of Swap Dealer and Intermediary Oversight (the “Division”) of the Commodity Futures Trading Commission (the “Commission” or “CFTC”) issued a noaction letter granting relief from registration as a commodity trading advisor (“CTA”) to a qualifying family office in connection with advisory services it provides to family clients.1 The relief follows the Division’s prior no-action letter dated November 29, 2012, which grants relief to a qualifying family office from having to register as a commodity pool operator (“CPO”).2
Consistent with the prior no-action letter on CPO registration, the Division’s no-action letter on CTA registration incorporates by reference definitions contained in Rule 202(a)(11)(G)-1 under the Investment Advisers Act of 1940 (the “Advisers Act”). That rule defines the term “family office” and excludes it from the definition of “investment adviser” for purposes of the Advisers Act. In this regard, the Division will not recommend enforcement action for failure to register as a CTA against any “family office” in connection with its advisory services to “family clients,” each as defined in Advisers Act Rule 202(a)(11)(G)-1.
As with the relief on CPO registration, the relief on registration as a CTA is not self-executing. A family office must file a claim with the Division to take advantage of the relief, which is effective upon filing, so long as the claim is accurate and complete. As a condition to this relief, the family office must remain in compliance with Advisers Act Rule 202(a)(11)(G)-1, as amended, regardless of whether it seeks to be excluded from the Advisers Act.