On December 21, 2013, the U.S. Commodity Futures Trading Commission (the “CFTC”) issued no-action relief deferring through May 1, 2014 the effectiveness of certain CFTC oral recordkeeping requirements. Prior to the relief, recent amendments to Regulation 1.35(a), which imposes recordkeeping rules on a variety of CFTC registrants, would have required fund managers who are both registered as commodity trading advisors and members of swap execution facilities to preserve oral communications, including telephone calls, that lead to the execution of commodity interest transactions (which include futures and swaps) and related cash or forward transactions. Note that revised Regulation 1.35(a) includes a separate exclusion from the oral recordkeeping requirements for commodity pool operators.
No relief was granted with respect to the written recordkeeping requirements under Regulation 1.35(a), under which all members of swap execution facilities are required to maintain full, complete, and systematic records of all transactions relating to their business of dealing in commodity interests and related cash or forward transactions (including any written communications provided or received that lead to the execution of such transactions). Under CFTC regulations, any entity with trading privileges on a swap execution facility is a “member” of that swap execution facility and is therefore subject to these requirements.
The time-limited no-action relief with respect to the oral recordkeeping requirements can be found here.