The National Futures Association (NFA) reminded fund advisers claiming an exemption from registering as a commodity pool operator (CPO) that they must confirm by March 3, 2014 that will continue to rely on the exemption.
The December 5, 2013 notice reminded advisers that if they fail to affirm an active Rule 4.5 exemption from CPO registration within 60 days of year end, the exemption will be withdrawn. The NFA cautioned registered CPOs that withdrawal of the exemption would result in the firm being subject to Part 4 of the CFTC regulations regardless of whether the firm otherwise remains eligible for the exemption. “For non-registrants, the withdrawal of the exemption may subject you to enforcement action by the CFTC.”
Notices of new exclusions filed during the affirmation period (December 3, 2013 through March 3, 2014) do not need to be affirmed until after the calendar year ending December 31, 2014.
Fund advisers that are registered as CPOs are also reminded that NFA Compliance Rule 2-46 requires quarterly reporting by all CPOs, including all fund CPOs, on Form CPO-PQR. Fund CPOs are required to file their first Form CPO-PQR with respect to the period ending December 31, 2013.
The information required on Form CPO-PQR is similar to that included on Form PF filed with the SEC by advisers to private equity and hedge funds. Fund CPOs that file Form PF with the SEC have the option of including information about funds that do not comply with Rule 4.5 on Form PF rather than filing Schedule B and/or Schedule C of Form CPO-PQR. All fund CPOs, however, must file Schedule A of Form CPO-PQR.