On December 18, 2015, the US Commodity Futures Trading Commission approved a final rule to amend CFTC Regulation 1.35(a) regarding recordkeeping requirements applicable to certain market participants. The rule would exclude certain market participants from various written and oral recordkeeping requirements and clarify requirements regarding the manner in which records must be kept.
Existing CFTC Regulation 1.35(a) requires merchants, retail foreign exchange dealers, introducing brokers, and members of a designated contract market or of a swap execution facility, including DCM or SEF members that are not registered with the CFTC, to keep records of their business of dealing in commodity interest transactions and related cash or forward transactions. In addition, these market participants must also keep records of written or oral communications that lead to the execution of a commodity interest transaction and related cash or forward transactions.
Under the amended rule, DCM or SEF members not registered with the CFTC are only required to keep records of their business of dealing in commodity interest transactions and related cash or forward transactions, and not pre-trade communications. Additionally, commodity trading advisers that are members of a DCM or of a SEF are excluded from the requirement to record and keep oral communications that lead to the execution of a commodity transaction.
The CFTC’s final rule is available at: http://www.cftc.gov/idc/groups/public/@newsroom/documents/file/federalregister121815.pdf.