On May 30, the Commodity Futures Trading Commission’s (CFTC) Division of Market Oversight and Division of Clearing and Risk (Divisions) issued Staff Letter 17-27, extending previously granted no-action relief to swap execution facilities (SEFs) and designated contract markets (DCMs) from restrictions on using pre-arranged trades to correct clerical or operational errors that (1) caused a swap to be rejected for clearing and thus become void or (2) were discovered after a swap has been cleared. (For a more complete discussion of the previously granted no-action relief, see the June 17, 2016, edition of Corporate and Financial Weekly Digest). The original no-action relief had been set to expire on June 15. To allow the Divisions to consider a permanent solution to regulating the correction of such errors, no-action relief will be extended until the effective date of any revised CFTC regulations regarding methods of execution requirements and pre-arranged trading.
Staff Letter 17-27 is available here.