CFTC’s MRAC announces agenda for June 27th public meeting. The CFTC announced the agenda for the Market Risk Advisory Committee (MRAC) public meeting to be held on June 27, 2016 at CFTC’s headquarters in Washington, DC. The MRAC will discuss the CCP Risk Management Subcommittee’s draft recommendations on how Central Counterparties (CCPs) can better coordinate their efforts in preparing for the default of a significant clearing member, and the role of the FDIC and CFTC in the resolution of both banks and CCPs. (6/16/2016)
Comment period for certain features of Regulation AT is reopened. The CFTC announced that it has reopened the comment period for its notice of proposed rulemaking on Regulation AT from June 10, 2016 through June 24, 2016 to accept comments on items in the Roundtable and Comment Period Discussion Points, the roundtable agenda, and issues that arose during the public roundtable that it held on June 10th regarding Regulation Automated Trading. (6/16/2016)
Federal Register publishes CFTC’s proposed clearing requirement rule. The CFTC’s proposal to establish a new clearing requirement under the CEA was published in the Federal Register. The amended regulation would require that interest rate swaps denominated in certain currencies or having certain termination dates be submitted for clearing by those required to do so under the pertinent section of the CEA to a derivatives clearing organization (DCO) that is registered under the CEA or a DCO that has been exempted from registration under the CEA. Comments must be received by July 18, 2016. (6/16/2016)
CFTC seeks public comment on rule amendment certification filing by ICE Futures US. The CFTC requested public comment on a rule amendment certification filing by ICE Futures US, which would clarify that parties to a block trade can participate in pre-hedging or anticipatory hedging of the position that they believe in good faith will result from the consummation of the block trade, except for an intermediary that takes the opposite side of its own customer order. Comments must be submitted on or before July 14, 2016. (6/14/2016)
CFTC approves final rule amending swap data recordkeeping, reporting requirements for cleared swaps. The CFTC announced its approval of a final rule that amends existing swaps reporting regulations in order to provide additional clarity to swap counterparties and registered entities regarding their reporting obligations for cleared swap transactions, and to improve the efficiency of data collection and maintenance associated with the reporting of the swaps involved in a cleared swap transaction. The final rule will become effective 180 days following publication in the Federal Register. (6/14/2016) Chairman Massad statement.
Certain exemptions, guidance on position limits for derivatives proposed. The CFTC proposed new alternative processes for designated contract markets (DCMs) and swap execution facilities (SEFs) to recognize certain positions in commodity derivative contracts as nonenumerated bona fide hedges or enumerated anticipatory bona fide hedges, as well as to exempt from federal position limits certain spread positions. The CFTC also proposed to further amend certain relevant definitions, including to clearly define the general definition of bona fide hedging for physical commodities under the standards in CEA section 4a(c). The CFTC separately proposed to delay for DCMs and SEFs that lack access to sufficient swap position information the requirement to establish and monitor position limits on swaps. Comments must be received on or before July 13, 2016. (6/13/2016)
DMO extends relief to SEFs and DCMs from certain regulations for correction of errors. The Division of Market Oversight and Division of Clearing and Risk announced a no-action letter extending relief from certain CFTC regulations to allow SEFs and DCMs to correct clerical or operational errors that caused a swap to be rejected for clearing and therefore become void. The no-action letter also allows SEFs and DCMs to correct clerical or operational errors discovered after a swap has been cleared. (6/10/2016)
Additional interest rate swaps for clearing requirement proposed. The CFTC announced its proposal to amend CFTC regulation 50.4(a) in order to require certain additional interest rate swaps to be cleared by market participants via a registered DCO or a DCO that has been exempted from registration under the CEA. The scope of proposed expanded regulation would make the CFTC’s clearing requirement consistent with those proposed or finalized in 2015 or 2016 by the CFTC’s equivalents in Australia, Canada, the EU, Hong Kong, Mexico, and Singapore. The proposed rule will be open for public comment for 30 days after publication in the Federal Register. (6/9/2016)