In a recent letter (the “CTA Letter”),1 the Division of Swap Dealer and Intermediary Oversight (“Division”) of the Commodity Futures Trading Commission (“CFTC”) offered no-action relief to a family office for failure to register with the CFTC as a commodity trading advisor (“CTA”) in connection with commodity trading advisory service provided to a family client. A family office is, generally, a professional organization that is wholly-owned by clients in a family and is exclusively controlled (directly or indirectly) by one or more members of a family and/or entities controlled by a family (a “Family Office”).
The CTA Letter builds on the relief provided by the Division in a 2012 letter (the “CPO Letter”),2 which provided relief from registration as a commodity pool operator (“CPO”) to certain family offices that (i) submit a claim for the relief and (ii) remain in compliance with rule 202(a)(11)(G)-1 under the Investment Advisers Act of 1940 (the “Advisers Act”).3
The CTA Letter states that the no-action relief from registration provided in the CPO Letter should apply equally in the context of CTA registration. Therefore the Division grants no-action relief from CTA registration for Family Offices eligible for relief under the CPO Letter, in connection with their advisory services to Family Clients (as defined in rule 202(a)(11)(G)-1(d)(4) under the Advisers Act), that (i) submit a claim electing the relief, and (ii) remain in compliance with such rule 202(a)(11)(G)-1, as amended.
Although the relief is not self-executing, complete claims by eligible Family Offices to perfect the relief will be effective upon filing. The claim of no-action must:
- State the name, main business address, and main business telephone number of the Family Office claiming the relief;
- State the capacity (i.e., CTA) and, where applicable, the name of the pool(s), for which the claim is being filed;
- Be electronically signed by the Family Office; and
- Be filed with the Division using the email address firstname.lastname@example.org with the subject line "Family Office CTA Relief."