The Commodity Futures Trading Commission approved revisions to its Form 8R – the basic application form used by individuals to register with it as an associated person of a registrant, floor broker or floor trader, or to be identified as a principal of a registrant. Among the changes to the form is the addition of a new category of individuals that could be associated with a floor trader – a s0-called “floor trader order enterer.” This new category accounts for persons who, for a floor trader’s proprietary account, execute swaps trades on a swap execution facility (click here for background in CFTC Rule 3.11(a)(1)). The revised Form 8R also accommodates recent changes to fingerprint requirements for non-US natural persons and certain outside directors of registered firms (click here to access CFTC Rule 3.21(e) and CFTC Rule 3.21(c)), as well as solicits additional disciplinary history information. The changes to Form 8R were requested by the National Futures Association and will be effective as soon as the NFA makes the new form available on its website. (Individuals have filed Form 8R electronically with the NFA since 2002.)

Legal Weeds: Registered floor traders that trade swaps for their own account solely on a swap execution facility do not have to register as a swap dealer regardless of the notional value of the swaps they have executed. (Click here to access CFTC Rule 1.3(ggg)(6)(iv) and here for CFTC Division of Swap Dealer and Intermediary Oversight No-Action Letter 13-80.) In its initially proposed Regulation Automated Trading, the CFTC recommended the mandatory registration of persons as floor traders if they engaged in algorithmic trading for their own accounts through direct electronic access on designated contract markets and they were not registered with the CFTC in any one of certain enumerated capacities (i.e., an FCM, floor broker, swap dealer, major swap participant, commodity pool operator, commodity trading advisor or introducing broker). Under a supplemental proposal made in November 2016, the CFTC recommended that the floor trader registration requirement only apply to an otherwise relevant non-registered person if the person traded 20,000 or more contracts in aggregate on a DEA basis across all DCMs on an average daily basis during the prior six-month counting period (i.e., January 1 through June 30 or July 1 through December 31). (Click here for further details regarding Regulation AT and the CFTC’s supplemental proposal in the article “Proposed Regulation AT Amended by CFTC; Attempts to Reduce Universe of Most Affected to No More Than 120 Persons” in the November 6, 2016 edition of Bridging the Week.)